To understand why Bitcoin exists, first, we need to understand money and the problem of our current monetary system.
We highly recommend starting with this relevant and vital documentary, Hard Money , made by an independent filmmaker, Richard James. It would be a 30-minute well-spent in your life.

Imagine you have a gold coin in your hand, one of the simplest and purest forms of financial self-sovereignty. To hold that coin, you don’t need to agree to any Terms of Service or Privacy Policy, comply with any KYC or AML regulations, or show your ID or give your name or social security number. You just hold it in your hand, and you can use it to pay for anything by giving that coin to someone else to hold in their hand. It’s pure freedom.
In addition to the freedom of what you buy with your coin, nobody can magically know who you pay or what goods/services you buy with that gold coin, because your privacy isn’t being compromised with gold. And since you have your privacy, nobody can know about your transactions, and so nobody can decide to restrict or control what you use that gold coin to pay for.
For thousands of years, gold was the global standard of money. Everyone maintained their financial self-sovereignty, and the privacy and freedom of everyone’s money was respected. It was really that simple.

The current global banking and fiat currency system was implemented very slowly by bankers over the past 100+ years. They partnered with the world’s governments who confiscated everyone’s gold under threat of violence. For example, after the Federal Reserve Bank was established in USA in 1913, the USA government violently confiscated everyone’s gold coins in 1933, forcing everyone to use the new Federal Reserve central banks and bank note system.

Banks initially replaced the gold standard with paper receipts called gold certificates, but after enough time passed, the banks basically just stopped redeeming them for gold. The bank’s gold receipts (bank notes, or “cash”) were just worthless paper at that point, but because of the government’s threat of violence, everyone was forced to keep using Federal Reserve notes.

More recently, the banks now use a digital database, where they can literally create money out of nothing, without even having to print it on paper. They have solidified their full power to manipulate and inflate the global money supply, monitor everyone’s financial transactions, and control the flow of all fiat currency in their banking system. Banks control everything now.

Once the central bankers had successfully taken over control of the world’s money supply, together with everyone’s ability to freely transact and trade, the world collectively lost the security, freedom, and privacy of its money.

After the implementation of the current global banking and fiat currency system, the world was left with no other choice than to trust bankers and politicians to run the global financial system in a fair way.

“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve.” -- Satoshi Nakamoto

The history of the abuse of fiat currencies can be grouped into 3 categories:

• Security: Bad people stealing your money or your money’s value, sometimes in obvious ways, sometimes in sneaky ways.
• Privacy: Bad people monitoring all your private financial transactions, and using your personal financial data against you.
• Freedom: Bad people controlling how you can spend your own money, who you can transact with, how much you can spend, etc.

Theft by Inflation: This is the primary way banks steal your money, and one of the most sneaky. When central banks issue new money, either by printing it on worthless paper, or just adding an accounting entry in a database they control, they inflate the global money supply. Inflation steals buying power from everyone who holds some of that currency, simply because there is now more of that currency in circulation. Gold cannot be created, so bankers invented a paper money system instead.

Theft by Seizure: This is one way governments can steal your money. Ever heard of Civil Forfeiture? If a police officer suspects your property was used in a crime, they can seize it, and you have to fight to try and get your stolen property back. Or, another example: Try entering a country with more than $10,000 USD in your pocket, not declaring it, and see what happens. It’s all the same: theft by other people with guns.

Theft by Taxation: This is another way governments steal your money. I’m not arguing if taxation is ethical or not, I’m merely stating the fact that your government has the ability to force your bank to give them your money, and this is a security vulnerability. For money to be secure it must be , unconfiscatable, and governments can confiscate your bank accounts.

If you physically pass fiat currency to another person, in the form of paper money or coins, it’s relatively easy to protect the privacy of your transaction, just like using a gold coin would be.

However, if you’re using credit cards, debit cards, wire transfers, PayPal, Venmo, LINE Pay, WeChat Pay, or any other centrally controlled payment network, you’re actively consenting to waive the privacy of all of your private financial transaction data, and giving it all to a trusted third party.

When all the data and metadata of your financial transactions is logged in a central database, whoever has access to that database can use your data against you. Here are some basic examples:

• If you purchased high-risk lifestyle goods like cigarettes, your bank can tell your insurance company to raise your rates.
• If you purchased something that is illegal, like recreational drugs, your bank can tell your government to prosecute you.

But in the case of some oppressive governments, they’ve taken this to the extreme. They centrally collect all financial transactions, and other data of all its citizens, and have created a totalitarian Social Credit Score system:

George Orwell’s writings have already become a reality in China because of the central bank fiat currency system, and the payment networks that were built on top of it. If you think this won’t happen in your country, think again. It happens very slowly, but eventually all world governments will implement a Social Credit Score system, China was just the first to do it.

In the first example with the gold coin, when you pass it to someone else as payment for goods or services, there is no centralized records of your payment transaction, and you have perfect privacy.

However, in the central banking system, since the bank has both the knowledge of your transaction data and the power to control your funds, they can evaluate against a set of rules to decide if they want to allow your transaction or deny it, as well as enforce that decision by controlling your funds. This is how governments have weaponized fiat currency and the central banking system as a System of Control upon its citizens.

To summarize: Because you have given up the security and privacy of your money, you have also lost your financial freedom.

“ Privacy isn’t about something to hide. Privacy is about something to protect.” -- Edward Snowden

The Cypherpunk movement was started by individuals who understood the importance of protecting individual user’s privacy and freedom on the Internet. The Cypherpunks commonly believed that the problems described above could only be solved with a completely new money system, which respected and protected individual’s security, privacy, and freedom.

Many of the Cypherpunks attempted to build new ethical e-cash systems which could replace fiat currencies and central banking. There were many difficult computer science problems to overcome in creating such a truly decentralized system, and while some of them came very close, they all failed.
That is, until one pseudonymous Cypherpunk finally figured it out in 2008:

Combining digital signatures, a distributed ledger, and a peer-to-peer network, Bitcoin was born.