Bitcoin: It doesn’t make sense _not_ to

Posted on November 10, 2013

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A good article in the Telegraph about state balance sheets and Bitcoin stepping up (via @maxkeiser whose show you should definitely watch). Here was my response on Twitter:

After a few chats about Bitcoin at Meaning Conference the other day (including great talks by Rick Falkvinge and Dave Birch), it became clear to me that the link between ‘network’ and ‘value’ is now inextricably linked. In fact, it has been for a while – but for a long time it’s been at a multinational corporate level. Now it’s at an individual level.

When I first got an email address and set a webpage up (back in about 1995), I was massively excited to get an email from someone in Mexico. Mexico, I thought. That was so surreal. Suddenly I had this direct and unexpected link to a world so far away from everything I knew. I was communicating with anyone, anywhere.

That’s how Bitcoin feels right now. The massive influx from China has 2 direct effects on me.

1. We’re already connected

Firstly, their buy-in directly affect the value of my Bitcoins of course. I say “of course”, but that’s actually Massive. We’ve got so used to thinking that information is freely-distributable, but that money is under the control of states and massive institutions.

Huge powers are in place to keep the value of a national currency from going up or down. You are deliberately separated, economically (as well as legally, through passports, visas, etc.), from everyone outside of your geographic area.

On a practical level though, that doesn’t make sense – everything we consume is from somewhere else. Everything that we spit out as ‘waste’ moves around the world. We are already connected with everybody through both worldwide shipping and transport networks, and secondly through the Earth’s natural networks – the weather, sea currents, migrating birds.

Under increasing global dependency, national currencies are starting to look like local currencies, operating inefficiently to “lock in” value through behemoth warships and nuclear threat when the going gets tough.

2. The protocols are already here

Secondly, if I can send an email anywhere in (or outside) the world, and assuming that distributed crypto-currencies are now a workable model (even if Bitcoin becomes something else, just as Netscape gave way to Firefox – a useful if not perfect analogy), why shouldn’t I be able to trade directly with anyone anywhere?

Taxes? Geographical exploitation? A vague sense of nationalism? As I said though, global networks are nothing new. Tax avoidance is already here, just poorly distributed, to paraphrase Gibson.

(That’s not to condone tax avoidance. But I do believe the debate on power and equality across local/regional/national/global/online levels needs to be had urgently, if we’re to avoid turning geographic war into war between these levels.)

People afraid of Bitcoin are just those with most to lose from the threat to existing gatekeeper structures – the “protectors” of some kind of global order, the sheepdogs of modern society.

Given that a lot of these people are still trying to figure out how email works (let alone bit torrent and proxy services), I think it’s fair to say a global crypto-currency has a pretty good head start.

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Posted in: Finance, Power