Media coverage
Sawa News Agency · 2021-11-11
PalThink for Strategic Studies held a Zoom discussion on digital currencies and their implications for the global economy, featuring economist Saifedean Ammous and attended by economists, civil society representatives, and youth from inside and outside Palestine. Ammous outlined Bitcoin’s features as a limited-supply form of money that can be transferred across borders without intermediaries, argued that it may be especially significant for Palestinians, and discussed its potential role as an alternative to gold and a savings tool, along with issues of network resilience, institutional adoption, and participants’ questions about state control, taxes, and other digital currencies.
PalThink for Strategic Studies held a Zoom discussion on digital currencies and their implications for the global economy, featuring economist Saifedean Ammous and attended by economists, civil society representatives, and youth from inside and outside Palestine. Ammous outlined Bitcoin’s features…
PalThink for Strategic Studies organized a discussion session titled "Digital Currencies and Their Repercussions on the Global Economy, Government Control, and the Global Monetary System" via Zoom.
This took place with the participation of Saifedean Ammous, Professor of Economics at the Lebanese American University and author of *The Bitcoin Standard*, the world’s foremost reference on Bitcoin, which has been translated into thirty languages, in the presence of a select group of economists, civil society representatives, and youth from inside and outside Palestine.
The session was opened by the Foundation’s Director, Mr. Omar Shaban, who welcomed the attendees and said: "At PalThink, we always keep pace with global developments that are particularly related to the Palestinian issue, and as you all know, PalThink is an independent institution concerned with political, economic, and social issues, not only in the Gaza Strip, but also in the Palestinian territories and the world at large." He added: "We are an independent institution open to scientific and objective dialogue for all segments of the Palestinian people, and we have full independence in addressing any issue in the way we see as serving a scientific and national interest for us all." He noted that the guest of the meeting is a distinguished economic figure and a pioneer in economic research, and among the first Arab academics in the field of digital currencies. He added that the international media has repeatedly highlighted him, but he has not received his due share of attention in Arab media and the Arab world.
For his part, the economic expert Dr. Saifedean Ammous thanked PalThink for the invitation and said: "I am very happy to speak with the Palestinian people everywhere, and I am very happy to speak with our people in Gaza. By the way, my lifelong dream is to swim in the sea of Gaza, but unfortunately I have not been able to achieve that." He added: "The subject of Bitcoin is very important for the whole world, but perhaps it may be even more important for the Palestinian people. I am very pleased that the Palestinian people have begun to take an interest in the subject of Bitcoin, because it may be the ideal technology created to overcome the difficulties faced by the Palestinian people."
What is Bitcoin?
Dr. Ammous pointed out that Bitcoin is the most advanced monetary technology for two reasons: the first is that the monetary supply of Bitcoin is strictly limited and cannot be changed, and no person can increase the quantity of Bitcoin in circulation; the second is the ability to conduct any financial transaction across borders within hours without the need for a political, judicial, or banking authority. He stressed that Bitcoin is the hardest currency and the hardest money in history because it is not possible to produce more Bitcoin than the amount programmed into it. This is a program put in place in 2008, noting that Bitcoin has now been growing for 13 years and has never deviated from this program. The economics academic continued: "The quantity of Bitcoin around the world has not exceeded 21 million units, and currently it is around 19 million units. Its growth was rapid at first and then slowed, but the growth rate remained relatively high. Now the supply rate of Bitcoin increases by 2% annually, and every four years this rate is cut in half, and its production rate is also cut in half. This is what makes Bitcoin the hardest money in history. It is like gold, but better than it in other respects. For example, gold is distinguished by its scarcity and cannot be increased very quickly, like Bitcoin, as it increases annually at a rate of 2%, but its growth rate will decline over time."
He confirmed that there is no authority capable of increasing the quantity of Bitcoin, unlike all other types of money, noting that the value of its available supply is not affected by the amount of demand, unlike all currencies whose value declines over time because their quantity increases. Dr. Saifedean said: "The value of Bitcoin increases at a rate of 200% annually, which is an extraordinary rate, as it triples every year. Now, after ten years, the market capitalization of the entire Bitcoin supply exceeds $1.3 trillion, making it larger than any currency in the world except the dollar, the euro, the yen, and the Chinese yuan, all within 10 years and without any authority overseeing it." He pointed out that there is no way to increase the quantity of Bitcoin in circulation in response to increased demand, explaining that its price in 2011 was 29 cents, reaching $5 at the end of 2012, then rising to $13 in 2013, then jumping to 732, and now to $66,000, in a way never seen in any financial asset in human history. There has never been any currency, bond, or stock whose value could increase at such a tremendous speed, and that is a natural result of there being no means to increase the quantity of Bitcoin."
Dr. Ammous explained that Bitcoin has not been hacked at all over 13 years despite the many attempts to do so, and this proves that only increased demand raises its price.
He continued: "Bitcoin enables us to dispense with central banks because anyone in the world can send and receive Bitcoin without any need for a bank or a financial institution. It only requires software available on the internet that can be downloaded onto a phone, and this is very important for Palestinians because they do not have a central bank or a national currency."
He said that Bitcoin is a network whose computational power is approximately equal to 10 trillion personal computers, and what is important is that Bitcoin does not require the internet, as it can be used through devices that operate by radio and devices that operate by satellite. Even if the internet is shut down, one can continue to use Bitcoin."
Regarding the network, Dr. Ammous added: "It has become clear that there is no real danger to the network and no doubt about its continuity. Today there are laws and legislation concerning the legitimacy of the currency and the permissibility of dealing in it by central banks, the world’s largest companies, the U.S. Federal Reserve, and the major central banks in Europe. Even major companies have started using Bitcoin as a financial asset placed on their balance sheets, such as Tesla, which is one of the 10 largest companies in the world. It keeps part of its payments in Bitcoin, and there are large and small companies that do the same, and all the companies that do so benefit from it."
The economic expert denied that the value of Bitcoin would decline in the near term, as it has never happened in Bitcoin’s history that its value declined after four years of rising prices; on the contrary, its value has always multiplied.
Bitcoin as an alternative to gold and savings accounts
He said: "Bitcoin represents a successful alternative to gold because the latter does not keep pace with inflation and cannot be spent internationally. If we look at the price of gold over the past ten years, we find monetary inflation and rising apartment prices and the prices of all human necessities, while gold prices remain constant. Not to mention an individual’s ability to spend it internationally.
As for Bitcoin, it keeps pace with inflation and its value increases greatly. Inflation may be 2% or 10%, but Bitcoin may double to 100%."
The economic researcher believes that savings accounts give only 0.5 to 2%, and this means that the savings account robs the citizen, because the value of cash declines. Bitcoin, by contrast, is the best means of saving. For example, if a person had saved $10 every week over the past five years, the amount would be $2,600, but its value now would be $62,000. The rate of increase is more than 2000%, stressing that tens of millions of people save in Bitcoin for the long term.
Dr. Sayf al-Din added: "The continued adoption of Bitcoin by companies gives them an advantage over others, and this is what we as Arabs and Palestinians must pay attention to, and it will come at a very high cost, because Bitcoin is in continuous ascent, and adopting it differs from adopting a particular technology, because its price will be many tens of times higher in the coming years, so delay has an ordinary cost. Unfortunately, in the Arab world we have a conviction that anything new does not last, and we adopt conspiracy theory and that governments will not allow such a thing."
According to the economic expert, Bitcoin is a digital wallet that has a private key and an address, as in email, and the key must be kept safe, as it is the only way to control Bitcoin, and if any person is able to steal the private key, they can steal the Bitcoin you own.
He said: "China banned Bitcoin this year, and most of the computing power and mining was in China, and it banned mining and trading, causing the price to fall, and now it has risen again. These operations slow the network but do not end it, and I believe it is a historic mistake for China to fight Bitcoin, and countries that have a measure of economic freedom like America and Europe will not fight it. They realize that keeping pace with development is far better than fighting it because they cannot stop Bitcoin. What they can do is stop benefiting from Bitcoin and make their enemies benefit more."
Participants’ questions revolved around whether, if Bitcoin fights the centralization of control over money, what prevents major and dictatorial states from fighting it given that it reduces their powers; taxes on profits and long-term investment in other digital currencies; the source of Bitcoin’s strength; and the impact of governments adopting digital currencies.
Text © Sawa News Agency — archived here with attribution to the source. — Machine translation for archival reference. — Original source