Bitcoin's (BTC) primary function is as a safeguard against the potential collapse of a superpower

Anatoly Yakovenko, the creator of Solana (SOL), posits that Bitcoin's (BTC) primary function is as a safeguard against the potential collapse of a superpower.

Anatoly Yakovenko, the creator of Solana (SOL), has put forth an interesting perspective on Bitcoin (BTC). He sees its primary function as safeguarding against the potential collapse of a superpower.

In a recent thread on X, Yakovenko suggests that Bitcoin should be viewed as an expense rather than an investment. It serves to protect against the risk of a nation with significant economic and military power collapsing.

"BTC has no inherent value. At best, it functions as insurance. There's a 1% chance a superpower may fall in any given year. Investing 1% of my wealth in an asset that could potentially retain value in such a scenario seems worthwhile to me. It's not an investment; it's a cost, and there's no assurance it will succeed. Whether priced at $100,000 or $10,000, it serves the same purpose. If it succeeds, it's largely unrelated to technology beyond the original breakthroughs from 15 years ago."

Many figures in the crypto space support the idea of BTC as a hedge against currency devaluation. Yakovenko acknowledges this stance, as it aligns with his viewpoint. However, he believes that investors should not commit all their resources to BTC.

"Currency debasement is akin to superpower collapse; they share a common purpose- insurance. If it succeeds, it's because safety and property rights possess inherent value. They are fundamental human needs according to Maslow's hierarchy. However, the correlation isn't direct. The absolute worst scenario is holding 100% BTC."

Yakovenko asserts that Bitcoin lacks intrinsic value, which aligns with his stance on cryptocurrencies in general. He stands in stark contrast to those who see Bitcoin as a valuable investment due to its scarcity and the perceived incompetence of the U.S. Federal Reserve.

When asked about the significance of coins requiring gas for transaction processing, Yakovenko replied, "It represents the share of all future capturable fees."

This statement ties into the concept of PoS (Proof of Stake), which Solana utilizes. It's a method of validating transactions and adding new blocks to the blockchain that consumes less energy than PoW (Proof of Work), the technology employed by Bitcoin. PoS also generates revenue for the network participants, which is then distributed among them.

As of the last 24-hour period, Bitcoin is trading at around $86,236. A modest increase of over 2% has been observed within this timeframe.

On the other hand, Solana is currently showing a decrease of 1.6%, bringing its price down to approximately $86.69.

The post Solana Creator Explains Bitcoin’s True Purpose- ‘It’s Not an Investment’ appeared first on best crypto news.

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This article is part of Benzinga's broader coverage of the metaverse and Web3.