BTC Revelation: Revolution of Production Relations in the Post-Capitalist Era

Overnight, BTC continued to fall at the 61k level. This morning, I briefly reviewed my investment records: Since 2024, the average cost of adding BTC positions has been 67.7k (floating loss 9.9%); if calculated from September last year, the average cost of adding positions is 55.4k (floating profit 10%) - compared to the mindless fixed investment of 52.8k, it is slightly more expensive. The main reason is very clear: insufficient investment in the 30-50k range from the second half of 2023 to the beginning of 2024, and after late April, it began to fall while replenishing, mainly in the 60-70k range, resulting in an overall increase in the average cost. Reflecting on it, my style still prefers to add positions on the left side more, that is, to operate against the trend and get on the car when reversing. In the face of the right-side market that keeps pulling up, I am always left behind and can't get on the car.

Overall, over the years, the overall holding cost of BTC base positions has been continuously raised to the current level of 14.5k (floating profit of 320%). The annual compound growth rate CAGR is about 27%, although it is less than 30%, but compared with many other investment methods, it can be said to be no less than or even slightly better. The key to Jiaolian's ability to achieve such results through the imperfect and often self-defeating operations mentioned in the previous paragraph is the adoption of the correct strategic thinking.

First-class strategy and third-rate tactics, although often cannot achieve first-class results, can at least easily get invincible. However, first-class tactical ability, but only third-rate strategic thinking, often ends up in complete failure. There are many smart and hardworking people in this market who are constantly being cut, constantly bursting, and constantly failing. Even if some people hit the jackpot in some cycles and suddenly become rich, they often lose everything they put in and profit very quickly, and cannot continue to win and expand their achievements. The lesson is not far away, which makes people sigh.

The essence of BTC, in Jiaolian's view, is a new type of production relationship in the post-capitalist era.

Let us define "value" as a certain proportional relationship between products. Just like the relationship between length and weight, there is also a certain value relationship between any two products, one with a large value and the other with a small value. From qualitative comparison to quantitative comparison, we need to introduce weights and measures and measuring tools. Length is measured in meters, and measuring tools are rulers. Weight is measured in grams, and measuring tools are scales. Value is measured in monetary units, and measuring tools are people's hearts.

For a single product, it is impossible to say whether it is long or short, light or heavy, or whether it is valuable or not. Only when it is compared with other products can there be such relationships as length, weight, and value. Therefore, all relationships are relative, not absolute.

But length, weight, and value are all objective facts, and are an objective attribute of the product itself. However, value is different from length and weight. The ruler for measuring length and the scale for measuring weight are standardized, tangible, visible and tangible. The scale for measuring value is in everyone's heart. The so-called "scale in the hearts of the people" is invisible and intangible.

BTC miners produce the most original product for BTC: BTC's ledger, or, strictly speaking, BTC's block space. Paying BTC as a handling fee for on-chain transactions, or "mining fees", in order to record your BTC transfer transactions on the BTC ledger is essentially bidding for the limited block space that is generated on average about every 10 minutes.

Of course, this block space is very different from our ordinary disk storage space. Just like a car is very different from the raw materials used to make it, such as steel and rubber. These block spaces are storage spaces that have been proven by the PoW proof of work generated by extremely powerful computing power. All data written to the block space is stamped with the mark of "reliability" or "security" by this proof. Even the most powerful power held by humans on earth today cannot shake it, the most powerful force cannot defeat it, and the most powerful capital cannot buy it!

Is such a product valuable? Of course it is valuable!

How much is this value? The current value is about 1 trillion US dollars - that is, the market value of BTC today.

Some people may argue that market capitalization is not a measurement of this value, but rather the total income of miners (for example, more than 10 billion US dollars in 2023. Even further, a large part of the total income of miners today comes from block rewards, that is, newly added BTC, and a small part comes from the fees paid by users. Only the fees are the real fees paid for the block space, reflecting the market value of the block space. Calculated in this way, the value is even smaller, probably only about 5%-10%, or 500-100 million US dollars per year.

Not really.

With such a "safe" block space, BTC transfer transactions can be safely recorded in it, and these transactions, that is, value transfers, have emerged as a value unit - BTC. BTC as a symbol is artificially defined, and its use as a value unit is the result of system emergence.

BTC output is determined by a deterministic, open and transparent mathematical formula that cannot be shaken or tampered with by anyone. High-security block space is the bottom line guarantee that this mathematical formula can be faithfully executed. This makes BTC a good tool for storing value.

In other words, the above characteristics of BTC make it able to attract more and more people to exchange their temporarily unspent money into BTC as a kind of savings and save money.

Keynes said that saving is investment.

When you decide to store value in BTC, value actually becomes capital - value that can automatically generate new value.

For example, if you spend 61,000 US dollars to buy 1 BTC today and store it in a cold wallet, then the value of 61,000 US dollars will be transferred to a certain person who sells 1 after skipping the turnover in the market. BTC. After this person gets the value of 61,000 US dollars, he may consume it or invest it in production. Considering the situation of investing in production, he uses this value to buy the capital required for production (such as venues, machines, manpower, etc.), and produces a value far exceeding 61,000 US dollars. Then he takes out part of the money he earns and redeems it for BTC.

Let's assume that this boss or individual producer is an extremely efficient producer. He has a huge advantage over other competitors in the market, so he produces a huge surplus value, which enables him to take out (61,000 + x) US dollars to buy BTC again soon.

If such a competition winner can not only buy back the BTC that he, the coin sellers, and the loss-making producers have lost, but also buy back more, thereby further increasing his BTC holdings, then their purchases are enough to drive the rise of BTC.

The BTC positions in the hands of savers who hoard BTC will increase in value due to the rise of BTC. This added value comes from the value generated by productivity outside the BTC system, which flows back into the BTC system. From the perspective of BTC hoarders, it is as if the value of BTC has "automatically" increased.

Therefore, from the perspective of BTC hoarders, BTC has the function of preserving value and automatically increasing value, thus becoming an excellent "store of value" (SoV).

It is precisely because BTC is an excellent "store of value" that has become a general consensus that producers will return the value of investment returns outside the system to BTC.

It is conceivable that if BTC cannot continue to maintain or even continuously destroy value, such as the ghost appearance of most "one-wave" altcoins falling endlessly, then only a fool would return value to such a "sickle harvesting land".

Therefore, the market value of BTC does not only reflect the original value of BTC block space for BTC transfer transactions, but also reflects the total valuation of all the value transferred by BTC, which is converted into capital, invested in production or reproduction, and generates greater value, and then these values ​​flow back to BTC, such a large value production cycle.

From this logic, it can be deduced into the future.

What's even better is that such a system where everyone is independent and produces together, its total value is shared by all BTC holders! Creating value together and sharing value together is very close to the ideal picture of "Datong Society".

The only thing missing is the great improvement of productivity and the great abundance of materials. However, with today's industrial capacity bursting and AI and other technologies changing with each passing day, perhaps only the so-called "fourth industrial revolution" is needed to continuously produce a large amount of materials, with everything you need, a dazzling array, and "9.9 yuan free shipping" for each item...

The manifestation of the great improvement in productivity must be that commodity prices are getting lower and lower, and the BTC you hoard will become more and more durable, and you can't spend it all, really can't spend it all.

Today's mainstream economists - capitalist economists - are scared to death, because this phenomenon is called "deflation" in textbooks, terrible deflation.

Why are economists afraid of deflation? Because today's mainstream economists, in essence, think about problems from the perspective of capitalist ideology. Capital is afraid of deflation, so they are also afraid of deflation.

Why is capital afraid of deflation? Because deflation means reduced profits or even losses, corporate bankruptcy, layoffs, employees unemployed, income cuts, social class decline, life back to poverty, and social turmoil.

For the convenience of discussion, the teaching chain calls the traditional capitalist production relationship - the company system (or the wage employment system) as production relationship 1.0; the new capitalist production relationship - platform economy, as production relationship 2.0; and the "common sharing" production relationship of BTC described above as production relationship 3.0.

Let's take a closer look at the characteristics of these three versions of the production relationship system.

Production relationship 1.0 is the company that everyone is most familiar with. Although the production relationship of the company is very common today, it actually has a very short history, only about 400 years. Today, due to time and space constraints, I may not be able to trace back to the production relations before version 1.0, such as farmers-landlords, slaves-slave owners, and primitive society, and many other earlier versions. I will have the opportunity to write an article to discuss them in the future.

The characteristic of the company system is that there is a clear stratification: shareholders hold shares; employees do not hold shares and receive wages; and other people who provide income to the company are customers, or consumers. But strictly speaking, what class are employees who hold a small amount of stock? What class are bosses who are still struggling to work on the front line? If it is a listed company, then if you buy two hands of the company's circulating shares in the secondary market, which class do you belong to?

So, we cannot regard all people who hold stocks as company bosses or capitalists. Stocks are just the right to claim the company's surplus value. Only the actual control of the company's capital is the key to determining who is the owner.

By the way, the English word for "class" is also the meaning of "class". The Chinese say "birds of a feather flock together". But capitalist production relations are to "divide people by their kind", that is, to divide them according to class, which actually has the flavor of "objectifying" people into "tools". This is a cultural perspective, just an embellishment in our discussion.

For example, suppose that Jiao Lian started a company from scratch with his savings from working for many years. Everything is difficult at the beginning. At the beginning, you have to do it yourself, that is, you hire yourself and exploit yourself. Suppose the company earns 300,000 yuan a year, and after deducting water, electricity, rent and other miscellaneous expenses, there is still 200,000 yuan left to pay itself. Then at this time, Jiao Lian is both a salaried employee and the owner of a company, a capitalist, but an unqualified capitalist, a "fake capitalist".

Why is Jiao Lian unqualified as a capitalist at this time? Readers may think that the company is profitable, with an annual cost of 100,000 and a profit of 200,000. This is not the case. The economic calculation of capital looks at the "opportunity cost" rather than just the explicit cost.

Assume that if Jiaolian goes to work, that is, sells his labor, he can get a salary of 1 million per year in the market. Then, this means that Jiaolian's productivity can be evaluated by the market to 1 million/year. Of course, it should be noted that the same time and labor, doing different jobs, the value of output is different. The continuous re-matching of talents and positions in the free market is continuous optimization, maximizing the value of a person's labor and time.

In any case, when Jiaolian gave up the opportunity to work for an annual salary of 1 million and started his own company to earn 200,000/year, he had already incurred an opportunity cost of 1 million per year. Adding the explicit cost of 100,000, the actual cost of the company is 1.1 million per year.

The cost is 1.1 million, the income is 300,000, and the net loss is 900,000/year. You can also change the calculation method. It could have earned 1 million, but now it only earns 200,000, a loss of 800,000, plus miscellaneous losses of 100,000, a total loss of 900,000/year. This is the real economic calculation. An investment that has been losing money for years is definitely an unqualified investment. Therefore, from the perspective of capitalists, Jiaolian is unqualified at this time.

If, if the current loss is regarded as an investment in the future. For example, after 5 years, the company's income can reach 1.1 million/year, and it will break even at this time. The total "investment" in 5 years, that is, the total loss, has accumulated to 4.5 million.

After another 5 years, the day of break-even. Suppose the company's income doubles to 2.1 million/year. At this time, it begins to produce surplus value, 1 million per year. It will take about 5 years to repay the previous loss of 4.5 million with the surplus value of 1 million/year.

However, we must also consider the social general appreciation rate of the investment principal itself. Assuming the general government bond interest rate is 4%, 4.5 million will grow annually in a compound interest manner, and it will become 7.5 million after 13 years. Therefore, it actually takes 8 years, 1 million per year, to truly make up for the investment losses in the first 5 years (calculating opportunity losses).

See how many years have passed? 18 years!

This is the result that can only be obtained under the ideal situation that the company's revenue will triple or quadruple in the first 5 years and double in the next 5 years.

What if the opportunity loss of the 4.5 million investment loss is not benchmarked with the general government bond interest rate, but with investment in BTC? Assuming that Jiaolian has mastered the method of investing in BTC and making long-term profits, the long-term annualized growth rate can reach 30%. Then you can calculate that it will only take 10 years for this principal to grow to an astonishing 62 million. Unless the company's business grows exponentially, it will never be possible to catch up with the appreciation rate of this BTC.

There are two obvious conclusions from this calculation:

First, don't start a business easily, especially a business from scratch. The compound strategy of working and hoarding BTC is far better than the strategy of starting a business on your own.

The higher your salary as a worker, the higher the cost-effectiveness of the latter strategy.

Second, class leap is extremely difficult. Workers who want to become capitalists by starting a business and becoming bosses will almost 100% end up becoming unqualified fake capitalists.

It is this conversion probability, which is approximately equal to zero, that divides people in the commodity society into two classes: workers and capitalists. If everyone can easily change their identity, then classes will no longer exist.

If Jiaolian suddenly turned on: at the beginning, it used the company's guaranteed income of 300,000/year to hire 3 employees with an annual salary of 100,000 (the actual salary is even lower because there are taxes, social security, etc.). The productivity of these 3 employees is explosive, and each person can generate 400,000 income for the company every year. Assuming that the company's explicit miscellaneous costs are reduced to an average of 50,000/person/year because of the sharing of multiple people, then the total cost is 200,000/person/year. In this way, how much profit can the company make from the beginning? (After considering the opportunity cost) 30 (income generated by the teaching chain) + 40 x 3 (income generated by employees) - 10 x 3 (employee salary cost) - 100 (teaching chain salary cost) - 20 (miscellaneous expenses) = 0 [Formula 1] Surprisingly? From the first day, the company has broken even! However, what kind of employees and what kind of business can earn the company 400,000 yuan with a salary of 100,000 yuan? At this time, the teaching chain is still not a qualified capitalist. Because the teaching chain itself has not yet been separated from labor. At most, it can only be regarded as a "quasi-capitalist". What if you hire one more employee? Then the teaching chain can stop participating in business work, but it still needs to undertake management tasks, which is also labor. But the formula becomes:

40 x 4 (employee income) - 10 x 4 (employee salary) - 100 (teaching chain salary) - 20 (miscellaneous expenses, squeezed, assumed unchanged) = 0 [Formula 2]

This is not enough. More people need to be hired. Suppose one more such excellent employee is hired. At this time, the teaching chain can spend 300,000/year to hire a manager to be responsible for the company's operations and management. In this way, you can become a real boss. The formula at this time is: 40 x 5 (employee income) - 10 x 5 (employee salary) - 30 (manager salary) - 100 (teaching chain salary) - 20 (miscellaneous expenses, continue to squeeze, unchanged) = 0 [Formula 3] At this scale, with 5 employees and 1 manager, the teaching chain began to really and thoroughly break away from labor and become a small capitalist. In [Formula 3], the "teaching chain salary" is actually the company's profit at this time, that is, it is paid by the surplus value created by other employees. Therefore, if the teaching chain has been working alone, even if the business is booming and the annual income is 10 million, the teaching chain can only be a "fake capitalist". If you hire people but still have to manage it yourself, or worry about some company operations, then you are a "quasi-capitalist". If all company affairs are fully handed over to professionals, and you don't have to do anything, but you still firmly control the company's control and distribution rights, then only then can you truly complete the class leap and become a real capitalist.

However, since the scale of this company is so small, the annual income is only at the level of millions, which means you are just a small capitalist like dust. If the company reaches an annual income of tens of billions to hundreds of billions, it can be regarded as a medium-sized capitalist.

Medium-sized national capitalists are enough to reach the level of "middle class" divided by the teacher in "Analysis of Various Classes in Chinese Society" on December 1, 1925. The article defines it very clearly: "Middle class. This class represents the production relations of urban and rural capitalism in China. The middle class mainly refers to the national bourgeoisie, who have a contradictory attitude towards the Chinese revolution..."

Before retiring, Boss Ma was a successful "quasi-capitalist". After retirement, Boss Ma upgraded to a medium-sized national capitalist, which is what the teacher called "middle class".

Why can such successful businessmen as Boss Ma and Boss Zhang only be called "medium-sized"? Because capital is globalized, so the ranking and scale should be viewed from a global perspective. You may not even know or be familiar with the real big capitalists. For example, the Rockefeller family and the Morgan family in the United States are capitalist families that have been passed down for hundreds of years. In fact, there are no real big capitalists in China. There are only agents arranged by these big capitalists in China. They have formed a unique class, which is called the "comprador class" in "Analysis of Various Classes in Chinese Society".

For the world where capitalism dominates today, the real big capitalists can no longer be described as "rich enough to rival a country". The country is just the actors, thugs and mascots they hired to perform on the stage.

It is as easy for a big capitalist to kill a small capitalist as to step on an ant. Capital naturally has a tendency to merge, and the strong will always be strong, and it is almost impossible to be defeated. This means that if you want to start from scratch, grow bigger and stronger, and finally overthrow the old capitalists, the probability of becoming a big capitalist yourself is infinitely close to 0, if not absolutely equal to 0.

The production relationship 1.0 adopted by capitalism is a great improvement over the previous production relationship 0.5 between landlords and hired farmers. Through the form of a company, people are liberated from the land, can move around the world, and get rid of the single-handed struggle of the small peasant economy. A large number of employees can be divided into professions and positions, and large-scale division of labor and cooperation can be carried out, which can greatly improve production efficiency and create more surplus value.

At the same time, employees are also liberated in the new production relations. They are no longer bound to the land, and can get mutual support in the company as a collective. This is reflected in the fixed monthly salary, and they do not have to rely on the weather for food like small farmers. Of course, if there is a particularly bad external shock in the economic cycle, there may be layoffs and unemployment.

Production relations 2.0, that is, the birth of the "platform economy", is based on the famous Coase theorem.

Why must people be organized into companies when they work together? Because the nature of many jobs cannot accurately measure input and output, that is, they cannot be priced by the free market.

When the bargaining cost (also called friction cost) of free market pricing is too high, such as for programmers who write code, or other highly professional positions, the huge information asymmetry caused by knowledge advantage makes it very difficult to conduct extremely fine-grained task evaluation and market pricing, so it is better to simply buy out the programmer's labor and make him an employee of the company. This is the basic meaning of the Coase theorem.

In reality, although there are program outsourcing platforms and so-called freelancers, they have not yet been able to completely replace hired programmers.

The reason why Jiaolian takes programmers as an example is that programmers are typical representatives of the new generation of productivity. The production relations 1.0 of traditional capitalism claim that capitalists are the bosses because they own the means of production (machines, factories, etc.). But in the Internet age, the means of production used by programmers, including computers, mobile phones, and the Internet, are actually borne or can be afforded by themselves. In other words, except for the fact that some companies pretend to provide these things that everyone can afford, in fact, every programmer can independently own their own means of production. So, at this time, why can a boss who does not own the means of production still occupy the position of a capitalist?

At this stage of productivity development, although capitalists can still prevent individual workers from owning all the means of production by creating some barriers such as intellectual property rights and data ownership, the wheel of the times is obviously ready to roll over the heads of traditional capitalists.

Programmers' work is too specialized and constrained by the Coase theorem. It will take some time to be completely liberated. However, in other more standardized jobs, such individual producers, or free workers, have already been born. For example, e-commerce sellers, private car drivers, takeaways, short video bloggers, public account authors, and so on.

Capitalist companies have transformed themselves into platforms.

There is a transaction relationship between individual producers, free laborers and platforms, but no employment relationship. It can also be said to be a capital-capital relationship between small capital and big capital, rather than the labor-capital relationship of production relations 1.0.

However, since small capital has no bargaining power in front of big capital, in the early stages of production relations 2.0, although these individual producers have gained greater freedom, they have also suffered greater oppression and exploitation.

The improved production relations 1.0 will also be strongly required by the state to protect the rights and basic welfare of employees. All of this is almost non-existent for free laborers in production relations 2.0.

They are better than the hired farmers in production relations 0.5 in that, in the presence of multiple platforms, they can obtain a certain bargaining power over the platform by changing platforms.

They are better than the employees in production relations 1.0 in that if they are engaged in a business with knowledge content, professional threshold or simply a business with strong temperament attributes (such as live streaming with goods), then they have the opportunity to become bigger and stronger, thereby obtaining excess returns, and even evolving into real capital that eats surplus value.

Production relations 3.0, that is, the "common production and sharing" production relations described by the teaching chain earlier, which are produced by each, shared together, and helped each other, is a new type of production relations created and inspired by BTC.

It is built on the basis of production relations 2.0, a more advanced stage of development.

The progress and change of production relations are driven by the progress of productivity.

Why did production relations 1.0 evolve into production relations 2.0? The Coase theorem is the constraint that limits this evolution. And what is the driving force? It is the progress of productivity.

To put it bluntly and perhaps a little harshly, it is involution. Those who cannot survive the involution will be eliminated by the company and cannot find a new job, so they can only deliver food, drive a special car, open an online store, and do live broadcasting.

Why does involution occur and eliminate labor? Because of the development of science and technology, the improvement of efficiency, and the improvement of productivity.

What is the topic that everyone has talked about the most in the past two years? Isn’t it that the development of AI (artificial intelligence) is advancing by leaps and bounds, and a large number of various jobs will be eliminated in the future?

Jiaolian saw a true story a few days ago. A foreign media, the editorial team, last year 60 editors, this year only the editor-in-chief himself was left. The manuscript is generated by AI, and the editor-in-chief is responsible for modification, polishing, and publication.

This is the general trend of historical development. In the future, only more and more people will be eliminated by production relations 1.0 and have to embrace production relations 2.0.

However, if these free laborers and individual producers trapped in production relations 2.0 just fight alone like the hired farmers in the ancient production relations 0.5, they will never be able to turn over a new leaf.

The only way to liberate and save these free laborers is to unite and link them.

It is not about linking in information, but linking their insignificant small capitals to form a united big capital, crushing the scale of all capitals of production relations 1.0 and 2.0.

This united big capital is BTC.

Today, the market value of BTC is more than 1 trillion US dollars. It ranks around the top ten in the world in terms of market value.

In the future, if the market value of BTC expands tenfold, it can be said to be larger than the capital of any publicly listed company.

All free laborers and individual producers who hold BTC seem to be individuals who are not employed by capital, but they are backed by big capital that is larger than any listed company, and they always share the returns of the continuous appreciation of this big capital.

He only needs to work for a period of time, and after accumulating enough BTC, he will be surprised to find that the return on capital alone is enough to support his living expenses. At this time, he can stop working and concentrate on enjoying life. Or he can continue to work, but only for interest and hobbies, or a sense of mission in life.

BTC, as a joint capital, will absorb the surplus value created by everyone (minus the part absorbed by other platforms), and then share it with everyone fairly.

When you work and hoard BTC, you use the value you create to meet the needs of others. When you no longer work and live on BTC, it is essentially other people who contribute the value they create to help you.

You raise BTC, BTC raises you. You raise everyone, everyone raises you. Everyone raises everyone.

Most importantly, BTC is decentralized, there is no arbitrary issuance, no PoS capital interest, no class inequality (sickle-leek) created by the initial token distribution, no privilege of a single organization to kidnap other participants to control the hard fork and arbitrarily change the token issuance method, etc. These are very critical basic structures.

Without these basic structures, a coin will become a sharp, bloodthirsty and cannibalistic harvesting weapon.

With these key structures, a coin has the opportunity to develop into a joint capital like BTC.

Such a joint capital can only be formed first in the category of productivity that is sufficient to overcome the Coase theorem.

Only by using truly decentralized crypto assets to carry joint capital can a truly fair union be achieved, ensuring that the value created and contributed by everyone can be "shared" fairly, and it is possible to build a new type of production relationship 3.0.

This is what Jiaolian has learned from BTC, about the revelation of the revolution of production relations in the post-capitalist era.