After thinking long and hard about what Bitcoin really is and why it is the most important technology ever invented in human history, I have come up with the following. I am curious if anyone out there agrees with me, so here it goes (sorry for the wall of text, but couldnt be avoided here
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The Resource Based Economy Through Blockchain TechnologyThe value of a Bitcoin is NOT simply its value in fiat money. In this, Bitcoin is NOT a bubble as pinned on pure asset classes like metals, stocks, derivatives, etc that see wild speculation with no fundamental basis for it.
Remember that the fiat exchange rate is only a measure of what 1 Bitcoin will buy in that fiat economy. If you spend a Bitcoin within Bitcoin's economy, it is only worth the goods and services that 1 Bitcoin will buy. Therefore, a Bitcoin's value is derived from the utility and service it provides to its users, not what Bitcoin can purchase in a broken, corrupt fiat money system. Remember that fiat money is worthless paper and nothing more.
It is backed by nothing but faith. Bitcoin is backed on being a useful innovation. I will explain this in detail below.
A Traditional Company, using Google as an example.
Google was once a two man operation working out of a small office comprised of Larry Page and Sergey Brin, with the great idea to improve search function on the Internet, which at the time was terrible at best (remember Webcrawler anyone?).
They created a working model of their idea in the form of a vastly improved search algorithm created with computer software, and pitched the idea to investors to fund more development.
Investors that saw the utility and usefulness of Google's improved search algorithm to users bought Google stocks at IPO to fund further development of these products. As an early investor, they bore the risk that Google may fail as so many .coms did in that era and their investment may vanish, but an equal reward should Google's products see a demand from a user base giving Google value as a company through the innovations it provides.
In effect, buying a Google stock for $85 back then was a purchase of Google's potential value to its users. A simple bet that Google has a good idea and it will be huge someday. Obviously, Google became a very successful company, based on fixing the long standing problem of terrible web search options. It provided something useful and desired by Internet users of the day, giving Google Search VALUE to users.
So,
company stock = a share of the current and future value of goods and services to end users provided by that company. In this example, the exchange rate for Google stock is $1,053.26 per stock. Keep this in the back of your mind.
Fundemental Flaws of Closed EconomicsThere are some problems with this business model as used by Google and every business ever created, namely in the centralized nature of business, banking, and government leading to inevitable corruption:
Closed code and closed operations. This renders any centralized business and government ultimately untrustworthy as it cannot be fully audited by the public. Is Google sending your every move to the NSA? Who knows, and that is a problem.
Services bought from closed companies are purchased with fiat currency that is issued by closed governments. This starts giving lots of power to the few at the top controlling both ends of the chain, and an incentive to start rigging the system in their favor and not in favor of the users. It should be obvious by now that the corporate world today is already deeply corrupted at every level.
Users have no say in the development or adoption of products or services. A new version of software is forced upon you whether you want to accept it or not. Facebook's constant screwing with its TOS is evidence of this behavior.
Closed business structure is hostile toward true innovation as solving real human problems forever is not profitable for them. Solving the energy needs of the Human race puts Big Oil out of business. Cures to disease puts Big Medicine out of business. The Internet itself is killing institutional education (that would charge you $40,000 a year to learn what you can on the Internet for free). Clearly, innovation is not the friend of Big For-Profit Business. Killing innovation is much easier than having to change as a business. Those in power like to stay in power.
A New Economic Paradigm Let's investigate how a digital coin is formed compared to the usual business model described above-
1.
A whitepaper is introduced describing a new digital coin and the overall blockchain technology that would underpin it.
This is the idea or innovation, in Bitcoin's case a worldwide distributed accounting system, currency system, and payment network that is publicly open at every level. This is what makes Bitcoin more than just money. It is a complete economic system rolled into one that is freed from central Human governance that always leads to a corrupted economy and society as history shows again and again. The open nature of blockchain accounting creates public trust.
2. Developers create computer software taking the innovation to a functional technology that is completely open source and open to all, free to propagate based on the innovation filling a particular need. In the case of Bitcoin, it provides a self-regulating open payment network and currency that is seen as a needed technology in our globally connected Internet-based world today. An open money system built just for the Internet is a good idea, and this idea begins to catch on based on these merits.
The idea has VALUE the same way Google Search did in the beginning to its users.
3. Early miners begin generating new coins into its economy. Instead of simply buying "stock" in Bitcoin with fiat currency (though this is done too, for now) as a traditional closed business, miners earn "stock" in the form of new coins by using their own computing resources to support and maintain a global network that makes transmission and trade of these "stocks" incredibly easy and accessible to every Internet user on Earth because access to this technology is 100% free.
The first miners in a blockchain have absolutely no incentive to be a part of that network beyond the possibility that the innovation it represents takes off in the public space, becoming a valuable
resource to end users. A few coins already died (ChinaCoin[CHN] isone) because users saw no real value in the blockchain or the services built on it.
People mined Bitcoin in the early days because it was a great innovation with amazing potential. Those that had early faith were rewarded by their "stocks" appreciating in value greatly today.
So, if a normal company stock really represents a stake in the potential value of products or services to the end user, a Bitcoin represents the same thing. Each coin is a share of the global Bitcoin economy that provides end users value in the form of products and services.
Now here is the really important part of this:Unlike a traditional company stock, you can purchase goods and services directly with digital coins. In the Google example, it would be no different than taking my stock to Subway and buying a sandwich with it directly without cashing it out to fiat currency first. I would be literally buying a sandwich with the present and future innovative potential of Google.
The middlemen (crooked banks and governments run by a criminal elite) have been eliminated, enabling the direct purchase of other goods and services with a living asset backed entirely by the true value of useful innovations and ideas to real people.
Basically, we can spend Bitcoin stock like cash as easily as sending an email.
That's right, if you own Bitcoin in any amount, you are a pseudo anonymous shareholder in a decentralized, fully autonomous, fully open, global crypto-corporation that runs in cyberspace, maintained by its voluntary "employees" comprised of any person or business operating in the Bitcoin space as either a service built upon it or directly as a miner supporting the core transaction network. Bitcoin is the first example of what can be called a Digital Autonomous Corporation, or a DAC.
In a sense, a Bitcoin accepting business or person is only a department in Bitcoin Incorporated, much the same way Search or gMail are pieces of Google's global enterprise. However, unlike a normal corporation, each "department" of Bitcoin is itself fully free to come or go at any time. If a crypto-based business finds a coin economy that suits it better, they can sell their Bitcoins for something else and start using that instead. Or both.
The Blockchain Economy effectively separates government and business by breaking the binding of centrally created government currency and privately owned business. In its place, a truly free and democratic marketspace. ____________________________________________________________________
The implications of this are astounding.____________________________________________________________________
A Resource EconomyAs seen, this technology is not simply a replacement for the Dollar. It is something much more. It rewrites how the world will do business in the future, free of government medding and profit whore CEOs.
There is no limit on how these independent digital economies can be applied.
An example of how a blockchain could be applied to green energy production-I decide to move off the centralized electrical grid and buy solar panels and deploy other green energy generators on my own house to provide 100% of its energy needs. I sell off whatever extra energy there is to the power company in the form of Renewable Energy Credits. My home state and local power company has an REC program so a business or person can purchase 1 Megawatt-hour of verified green energy at a time from grid-tied solar farms without knowing which farm produced it. RECs are needed because it is not possible to track the source of any given electron.
We could turn the REC into a blockchain with specialized open-source miners that essentially turn the power you generate into a unit of electrical resource through some kind of production based mining algorithm, generating a certain amount of coin depending on your power output to the grid. This EnergyCoin can then be sold to anyone who needs more power from the distributed grid without knowing who generated it, just like RECs already are, but without an ominous cloud of government bureaucracy that differs from place to place.
However, the REC as they are today cannot be traded for much else. Energycoin however can be bought or sold over the Energycoin network by whoever needs more power than they can produce on their own in a peer to peer fashion cutting out centralized power companies completely, and exchanged for any other type of resource. This means that electrical power can be purchased from your neighbor with the big Solar farm directly, face to face. No power company required. Those that produce the most energy benefit the most by generating more coins, a valuable economic resource. This would incentivize green power deployments, and to the victors go the spoils of generating the most and the cleanest energy possible for sale to people or businesses that need lots of it.
Lets say my house generates more power than I can utilize and as such I'm generating lots of Energycoins, a needed resource by all of humanity.
I want to host a website that would require a lot of bandwidth and data storage using the Meshcoin and Datacoin blockchain networks. I don't have a large enough wireless Meshnet node for the bandwidth needed to support 1000s of users at the same time. I also don't have enough or any Datacoin nodes to support these users either.
But, my neighbor Bill sure does. He houses a large Meshnet wireless array and Datacoin storage nodes that meet my needs. But Bill feels the hurt of running such big equipment, and needs more power to run them.
I can go to Bill, and sell him Energycoins he can redeem at my solar farm for Meshcoins and Datacoins I can use to access his Meshnet gateway and storage pool. He gets more power, I get Internet resources in a mutual exchange. Service to Service. Person to Person.
Or the exchange can happen over a simple global exchange anonymously if I think Bill is a jerk and I dont want to talk to him, but I can still use the resources he is providing to the Internet by selling my energy that I dont need for things I do need.
With Bitcoin itself functioning as the world reserve currency, or a universally accepted currency under all other blockchains, each of these industry coins can be redeemed in the reserve currency too
ConclusionThis is all very much a thought exercise and not meant to be a whitepaper, it would take people smarter than I to implement such things, but an idea of what a resource economy can look like with Blockchain tech at its heart. Fully distributed everything, where anyone can participate freely. Whatever skillset you have can be converted into a useful resource to other people with this kind of exchange.
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If you are still here reading this, thank you for sticking through. I know that was looong
But I am trying to think forward a bit, and quantify what Bitcoin really is in terms that a new Bitcoin user can understand in relation to how the world works right now.
There is a very long way to go, but I do think Bitcoin is just the first example of how pervasive this technology will become over the next years, totally rewriting not only how we do business, but getting a fair return for our productivity in interest of our own species.
What do you see the revelation of Bitcoin to be? 
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Even those old GPU rigs still have life there.
Not cool
