Not many of you know about Hal Finney but he has a unique distinction in that he is the first recipient of Bitcoin. He was the first person that Satoshi Nakamoto sent Bitcoin.
Hal Finney received roughly 10 BTC which was worthless at that time, it was mainly sent to test if the network works. Since then both of them have exchanged emails, although Hal never really found out who Satoshi was, and have fixed bugs within the Bitcoin algorithm.
Hal Finney passed away on August 28, 2014, at the age of 58 due to ALS. He had decided to preserve his body cryogenically by freezing it and his body is currently present at the Alcor Life Extension Foundation.
His wife has summed up his life perfectly.
“He’s always been optimistic about the future. Every new advance, he embraced it, every new technology. Hal relished life, and he made the most of everything.”Fran Finney (Hal Finney’s wife)
Here are the Hal Finney Bitcoin Quotes
In this post you will find
Top Hal Finney Bitcoin Quotes
“Running Bitcoin” – Hal Finney
This is the first tweet he sent out after he started running the Bitcoin network at his home. He mined roughly the 70th block in the whole Bitcoin ecosystem.
“The price of Bitcoins can’t rise too much above the cost of mining” – Hal Finney
This is a simple economic paradox.
A base rule of the human psyche related to economics is that people will produce more of a commodity that has a good profit margin.
This is normal because that big profit margin entices participants to enter the market.
But the paradox here is that more and more participants enter the market, then they start competing on price because they are dealing with a commodity. Then the profit margins dwindle and it discourages new entrants into the market.
Similarly consider the situation with Bitcoin. BTC is a commodity. Anyone can mine bitcoin, there is no restriction. If the price of bitcoin is a lot more than the cost of mining it, then it encourages more people to mine it.
Evidently, as we saw earlier, more people will get into it. The only catch here is Bitcoin is not just any other commodity where you can create a surplus because it is dependent on time and not the amount of effort put in.
For example, if you convert more real estate into farmland you can grow more produce. But if more people start mining Bitcoin then the difficulty to mine each block increases. With more difficulty, the amount of energy required to mine a block will also increase thus raising baseline costs. Those costs will roughly cancel out any gains you get from increased Bitcoin prices.
Thus Bitcoin naturally incentivizes people to search for unusual sources of electricity that are relatively cheap. This in turn makes the unusual or cheap source of energy more valuable and this is something that most people don’t understand and claim that bitcoin is bad for our environment.
Bitcoin literally encourages and incentivizes people to get off the grid and find alternative energy sources.
You might feel like what is the point of mining if the price of Bitcoin is just sufficient to provide the cost for mining? In short, the transaction fees come into play.
“The danger is if people are buying bitcoins in the expectation that the price will go up” – Hal Finney
This is what has caused the last three bull and bust cycles in the history of Bitcoin. People who do not understand Bitcoin just buy it and hope that it will appreciate in price.
An average person does not buy a home anticipating it will go up in value in 36 months so he can sell it. No, they dream about a house and they buy it and enjoy every day they are living in it. The average person does not buy Gold jewelry with a view to selling it when the price goes up. They buy it and hold on to it till a need arises where they would have to sell it to settle that problem.
Why is Bitcoin any different that Real Estate or Gold? It is the most scarce asset in the history of humanity. People need to understand this.
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