Before you can fully appreciate Bitcoin, you must first understand the system it was designed to replace. Fiat money—the dollars, euros, pesos, and yen we use every day—is not neutral. It is political, fragile, and built on a foundation of trust that has failed time and again. If you have ever wondered why Bitcoin matters, you must start with what is broken in our money.

Inflation by Design

Fiat currencies are issued and controlled by central banks, which can expand supply at will. Every round of quantitative easing, every bailout, and every stimulus check financed by money printing chips away at the purchasing power of savers. Inflation is not an accident of fiat—it is a built-in feature. Over time, it silently robs individuals of their wealth, transferring value from savers to debtors and central banks.

Bank Collapses and Fractional Reserves

Bank collapses expose another weakness. The 2008 financial crisis revealed to millions of depositors that their balances were not truly theirs. Banks operate under fractional reserve lending, holding only a fraction of deposits while lending out the rest. Your bank balance is not an asset you own outright—it is a liability on the bank’s books. When banks fail, depositors are treated as unsecured creditors, often left hoping to recover pennies on the dollar.

Hyperinflation: A Living Example

Hyperinflation provides the most devastating reminder. In Venezuela, Argentina, and Turkey, citizens have watched entire savings vanish as their currencies collapsed. Money that once bought a month of groceries suddenly buys only a loaf of bread. These events are not rare anomalies—they are warnings of fiat’s fragility, capable of failing swiftly and catastrophically.

The U.S. Dollar Is Not Immune

Even the U.S. dollar, often viewed as the most stable fiat currency, is subject to the same pressures. Continuous money printing and ballooning national debt steadily erode its value. Over the past century, the dollar has lost more than 90% of its purchasing power. The result is simple but devastating: every paycheck, retirement account, and savings balance shrinks in real terms year after year.

Bitcoin: The Lifeboat

This is the backdrop against which Bitcoin was born. It is no coincidence that Satoshi Nakamoto encoded a reference to bank bailouts in Bitcoin’s very first block. Bitcoin was not created as a speculative plaything—it was engineered as a lifeboat away from fiat’s sinking ship.

The Truth About Survival

Once you recognize the failures of fiat, one truth becomes undeniable: Bitcoin self-custody is not optional. It is survival.