We are in special times

Old paradigms dissolve. New ones enter the scene so fast that disruption of society becomes an everyday thing without giving enough time to sufficiently process all the changes both on an individual and a collective level. At the forefront is digitally stored value on the blockchain and knowledge gathered via AI.

Fears of losing control

We are 15 years into the Bitcoin project and many things that bothered OGs have been fixed e.g. liquidity, accessibility and self-custody. Spending cryptocurrency in everyday life situations is still a major issue though, partially because governments around the world didn't embrace these developments with open arms, but rather tried and still try to kill and control what they fear could erase some of their power.

Habits change slowly

But also peoples habits are slow to change and people learned to sit on their gains ("hodl") rather than using cryptos as currencies. Back in the day only few people had cryptos in their wallets and many merchants that accepted Bitcoin in 2013 stopped because demand was too low. Nowadays much more people in the ball park of x1000 have cryptos in their wallets, but merchants are hesitant to accept crypto for many different reasons including regulatory risks. People also learned that compliance in this society is valued higher than integrity.

The privacy mess we created

Where Bitcoin and most other projects failed utterly is to protect the data and privacy of its users. Resulting in a fungibility problem that discourages the use of crypto as currency endangering the human right to privacy.

Coin-joins and other obfuscation techniques on transparent ledgers are accessible only by the very few technically skilled and still failure prone. Do we want to live in a world where 99% of the people lose all privacy in their financial lives? Where only a handful of people will be able to stay private or anonymous, but still are easily detectable because their patterns of usage stick out of the masses.

The case for a private store of wealth

Let's enter world-renowned Swiss banking or off-shore banking. Trillions worth of USD stored far away from the grip of powerful governments. This is the old way of doing private "custody" still in a centralized but hideous way. Then there is transparent "self-custody", which is what Bitcoin and the crypto revolution so far is all about.

The synthesis of both worlds is "private self-custody"

By looking at Bitcoin (but really all transparent ledgers) vs. Monero market cap one can easily conclude that this market has not yet tapped into the topic of longer term private wealth storage.

What is more important?

• That something can not be touched by anyone without your consent.
• Or that something can not be seen by anyone else.

Arguably the latter as anything that can be seen, can also be used to extort and overrule the consent of an individual or a group.

The inflation hedge

While Bitcoin akin to gold is a transparent store of value that protects you from inflation, Monero is a private store of wealth, that will guarantee the integrity and the stability of your wealth as a whole. It is crypto's, off-shore bank today and even more so in the future.

Imagine what will happen in year 2034, when Bitcoin reached its full capitalization around $1M at today's USD purchasing power equivalent. The market is saturated. No more gains, just further inflation protection against daily devaluing CBDCs.

The era of private wealth management vs KYC AI

In today's world, gold and fiat co-exist quite nicely. One as a pure store of value and the other as mainly a medium of exchange and when it comes to USD, CHF, EUR also with some store of value qualities. All this despite fiat's inferior properties as a store of value compared to gold. Which means for practical reasons fiat works "good enough" as a store of value. In a fully capitalized market other monetary properties like access and acceptance seem to become more important than inflation protection which is inherent in fiat currencies.

What will be new thanks to AI and ubiquitous KYC is the almost perfect traceability of anything centralized (bank accounts) or *transparent * (blockchains like BTC or ETH). Is this scenario substantially different from a CBDC? The only thing that will be out of control is money supply management. But taxation and expansion of the money supply through fractional reserved crypto banks will be as easily possible as today.

Two things to realize:

1. Without a fully encrypted blockchain all financial privacy will be gone within a decade from now.

2. Those who use Swiss banking or off-shore banking for private wealth storage do not care for their vaults to be in gold, they care for it being private despite being nominated in devaluing USD.

Conclusions

Monero is a sleeping giant that is to some degree massively misunderstood by the current investors or speculators/gamblers. Monero will reach its full potential only once the decentralized ecosystem (DEX, atomic swaps) that is currently being built around it proves to be safe, independent and uncontrollable in a fully adversarial environment.

This will lead to money flowing from both private custody (off-shore banking) and transparent self-custody (digital gold/ store of value) into the private self-custody solution that is Monero.

Monero was briefly a top 3 coin in 2018 and that is where it belongs again.