The Bitcoin Worldview
THE BITCOIN ESSAYS
Originally Published February 2023
15 Minute Read
We all wear glasses. No living person sees the world objectively. Our worldviews simultaneously grant us sight and render us blind. We look through a glass darkly and the fault for this lies in our limited understanding and perspective. The lenses we wear are multilayered and multifaceted, fashioned by cultural heritage and personal destiny. On occasion, whether through voluntary exposure or involuntary stimuli, our worldviews smash against the shock of counterculture. These experiences can be enlightening, traumatic, dumbfounding and perplexing, and they always change us. A worldview is never a static thing, yet the deeper you peer into its foundations, the more immovable it becomes. In this essay, I will explore ‘The Bitcoin Worldview’. What it is. What it isn’t. And most importantly – how it changes the one peering through its prism.
By this point, most everyone has at least heard of Bitcoin. At some level, everyone knows it’s new, it’s technology, and it’s changing our world. But for most people, this is where the exploration ends. The cognitive dissonance is too strong, they get confused and ultimately opt out from further exploration. If you’re reading this, you’re a special breed. So let’s set the technology piece aside and gain a deeper understanding into the philosophy, economics, politics, and values that act as the substructure for the technological marvel that is Bitcoin. We’ll begin with philosophy and work our way through the list.
Everyone is a philosopher. We all have theories on how we got here and what we’re supposed to do now that we’re here. We think our thoughts are common sense and stand awestruck when others say and do things in the uncommon way. Philosophy can be as elementary as the speechless child forming logical ideas of self-awareness and object permanence, or as lofty as the infamous Greeks whose busts line museums the world over. In Bitcoin there are several key philosophical hallmarks worth examining that provide fundamental concepts for building out the superstructure.
1.) Individualism. The idea here is that the individual is the most basic building block of all social organization. Whether it be the nuclear and extended family, the communities of church, school, and local government, our sports teams and businesses, and all the way up to the categorical nation state. Each of these units is somewhere on the spectrum of a small to massive conglomerate of individuals. The individual is clearly defined and clearly observed. Any action we ascribe to one of the aforementioned conglomerates is but a summation of aligned individual action. In Bitcoin, the individual is treated with the same rights, freedoms, and opportunities as any small or large conglomerate of individuals. This idea is absolutely profound and revolutionary and will likely take time to sink in as this paradigm rocks the social fabric of society; in my opinion, for the better.
2.) Self Sovereignty. Not to be confused with the theological assertion of a Sovereign Divinity who would be Sovereign in the supreme, universal sense. Self sovereignty is the idea that again, the individual, is sovereign over their own action. Only the individual can act or abdicate from action. Whether through free-will or pre-determinism, each individual is understood to have agency in their perpetual decision making. Bitcoin amplifies this reality by enabling the individual to become self-sovereign in securing their wealth via digital information. Only the individual can decide to opt in by generating their own sacred entropy, and likewise, only the individual can opt out. This gives the individual a tool like none other for asserting themselves in the macro-economy and protecting their resources into an otherwise unknown future.
3.) Personal Responsibility. The ramifications of being sovereign over ones action, is that one must therefore be responsible to themselves and to other sovereigns for said action. The individual is free to act, but is not free to take no action. Therefore, action is perpetual and begins and ends with the individual. Responsibility for said action must end with their person. The Bitcoin protocol honors any entity desiring to generate entropy and broadcast their will into the marketplace. Likewise, the protocol treats all participants equally in terms of its rule set and enforces strict regulation for all participants to be responsible for their action. This concept is known more popularly in the meme, “Not your keys. Not your coins.”
4.) Accountability. The root of accounting is account. When one considers ideal money as a perfect token of dematerialized energy, accountability is baked into the accounting. In other words, your bank account should be a perfect sum of all the potential energy you are desiring to store for future action. Failure to meet your obligations should result in a respective deduction to this account and a credit to the account to whom the payable is owed. Many believe this is how money already works but this is not the case. In a centralized monetary system, some entities are empowered to call new accounting units out of the ether. In other words, some entities are allowed to print energy. This of course is but a money mirage as the laws of physics (the conservation of energy specifically) override this misguided notion and ultimately punish all other account holders through energy dilution. In Bitcoin, the accounting is perfected in the sense that all participants know what they have, what others have, and all participants know that all other participants know this same thing. This methodology creates a thermodynamically sound system for accounting of individual action which is even more fundamentally, a balance of kinetic and potential energy. All actors are accounted for, and all actors are accountable, equally.
5.) Decentralization. Our modern western governments are built on the philosophical concepts of decentralization. Enabling governance of, by, and for the people is only possible if we are all free to participate. In Bitcoin, keeping the blockchain small such that all participants can maintain a complete record of protocol activity is what makes it decentralized. If at any point the size of the blockchain is growing at a rate that outpaces a reasonable ability to run a full node, decentralization is undermined and the integrity of the system is destroyed.
Now that we have covered these philosophical foundations, we may turn our focus to economics. The Bitcoin Worldview is a free-market capitalist worldview.
This stands in stark contrast to the ideas of Marx and the Communists who propose protocols of wealth redistribution through central authorities. In Bitcoin, all participants are free to amass capital and have assurances that their capital is perfectly preserved and protected from debasement through wealth redistribution. The Bitcoin protocol establishes a fair game for all participants to claim their piece of the metaphoric pie and ride its tide.
A fascinating exploration in Bitcoin is diving deep into the economic theories of the Austrian economists who propose the merits of running society on hard money which enforces natural law commonly on all market participants. This ideology stands in stark contrast to the economic theories of Keynes and his ilk who propose various ideas surrounding supply elastic money.
In the long run, the Bitcoin economy is a proxy for the global economy. By this I mean global in the sense of all market participants, as perhaps one day humanity indeed realizes its multi-planetary aspirations and conducts economic action throughout space. In the long run scenario, Bitcoin near-perfectly compresses all global market signals into an elegant form of high-fidelity economic communication. Our modern global economies approximate this reality today, but still fall far short of the ultimate aspirations of a global Bitcoin future.
Another economic topic worthy of exploration in the Bitcoin realm is that of game theory. The study of game theory is but a study of incentivisation and statistics. In the academy this may appear as a lecture and homework assignment on The Prisoners Dilemma but ultimately, game theory is happening everywhere, all the time. Game theory cannot tell you what will happen, but can provide a hazy crystal ball into what is likely to play out in a general sense. In Bitcoin, one quickly realizes that what Satoshi unleashed in January 2009 is a global game of musical chairs in which all actors are incented to take their seats sooner than later.
Having now covered some high level concepts in the philosophical and economic domains, some discussion around politics is next on our docket. This realm is perhaps where Bitcoin offers one of its most timely and high utilities. This protocol is completely, perfectly, apolitical. Meaning, it is not political. This may strike you, depending on your political persuasion, as a surprise. But consider, is gravity political? Is the emergence of holiday traditions political? The fact that it’s healthy to sleep roughly 7-8 hours each night? Of course not. Many protocols and norms in life are simply life itself and are not political in nature. At its base layer, Bitcoin is no different. It is simply code. It is simply mathematics. It is simply speech. It is no more Liberal or Conservative than it is Eastern Orthodox or Latter-day Saint. The protocol is a decentralized game, rising out of the internet. It is a new language willingly teaching anyone with desire to learn its tongue. It has no nation, no flag, and no border. It is pure information through and through and nothing you or I say or do can change this reality. The Bitcoin protocol is an ungoverned governor and should it continue its ascent, it will one day become money of, by, and for the people.
Here now we turn attention to the last item on our shortlist; values. These are where principles find their helpmate. Values provide continuities through individuals and the communities they inhabit. Our values align us and we intuitively know the words of Christ hold true that “a house divided cannot stand.” In Bitcoin, the values you are likely to encounter are consistent with ones you likely already hold. If you value truth, integrity, respect, nonviolence, privacy, property rights, and freedom, Bitcoin is for you. Let’s run it again.
1.) Truth. How starved we are for this in our world today. Political tension. Religious tension. Wars and rumor of war. We’re enmeshed in technologies that amplify our smarts, but test our wits. Establishing credibility and proxies for truth are as hard as ever they’ve been. So what on Earth does Bitcoin have to do with truth? Here is a key point to clarify something Bitcoin is not. Bitcoin is not truth in the ultimate sense. It cannot tell you the meaning of life, or the best way to cook your Thanksgiving ham. It won’t reveal your one true love or teach you the natures of good and evil. Yet Bitcoin is, absolutely true. What is more true than the abstract truths of mathematics and physics? You can deny them all day long, but should you disobey their decree, their laws will punish you. In this sense, Bitcoin has a divine quality. It’s code is law and it’s law is code. You can trust in numbers because numbers tell no lies.
2.) Integrity. The characteristic of integrity is that something is, though not monolithic, unified in its quality all throughout. You can be evil and have integrity. You could be a Patron Saint and have integrity. The point is consistency. What we find in Bitcoin is a decentralized global machine of machines perpetually executing immutable code. The rules are common and whether you look at the system from a birds eye view or down to its most granular form of individual bits of information, it is a true system with absolute perfect consistency throughout. It is for this reason some Bitcoiners refer to it as, The Truth Machine.
3.) Respect. Having regard for the other. This value is crucial to the Bitcoin worldview. Respect is embodied in Bitcoin’s decentralization, which means that no single entity or group has complete control over the network. Instead, every participant is treated as an equal, and their contributions are valued equally. This respect for the individual is one of the key reasons why many people are attracted to Bitcoin. In the traditional financial system, individuals often feel that they are just a number, and their needs are ignored in favor of the interests of large corporations and governments. In contrast, Bitcoin empowers individuals to take control of their own financial destinies and be part of a global community that respects and values their contributions. Moreover, the respect for privacy and property rights, which are also key values of the Bitcoin worldview, contribute to a sense of dignity and autonomy that is often missing in other areas of life. Respect is an essential value in the Bitcoin worldview because it underpins the decentralization and empowerment that make the network so appealing to its users.
4.) Nonviolence. The logic of violence boils down to a cost-benefit analysis in the mind of the attacker. The legacy financial system and archaic bearer assets (like precious metals) incentivize theft because, in the law of large numbers, the rewards justify the attack.
In Bitcoin, attackers are asymmetrically disincentivized to commit violence because the economic incentives do not merit the action. This frees participants to cooperate and work to mutually beneficial ends. Furthermore, Bitcoin creates a level playing field and can help to remedy the economic inequalities and geopolitical tensions that often lead to conflict.
In a Bitcoin world, central authorities are disincentivized to employ coercive tactics. Instead, network participants are treated equally which encourages all participants to act as ethically as possible to attract more business.
5.) Privacy. In an era of increasing surveillance and data breaches, the value of privacy has become more important than ever. Bitcoin provides a way to transact and store value without the need for intermediaries, which can help users protect their financial privacy. This feature is especially important for individuals living under authoritarian regimes or those concerned about their financial data being tracked and monitored by third parties.
By using pseudonymous addresses and public-private key cryptography, base layer Bitcoin transactions inherently possess a moderate level of privacy. However, it is important to note that base layer Bitcoin is not completely anonymous, and law enforcement agencies can use various techniques to trace transactions back to their owners. This is particularly straightforward when users have procured their coins from KYC (Know Your Customer) compliant exchanges. Additionally, Bitcoin privacy can be compromised if users do not take appropriate precautions, such as using strong passwords and secure hardware wallets. Users seeking to remain truly anonymous will be required to employ derivative layers like mixing services, onion routing, and/or specific Lightning protocols.
Despite these limitations, the value of privacy is an essential part of the Bitcoin worldview. By enabling individuals to transact and store value in a private and secure manner, Bitcoin provides a powerful tool for promoting individual freedom and autonomy.
6.) Property Rights. The right of an individual to own and control property is fundamental to western ideology. Bitcoin’s decentralized and permissionless nature makes it a powerful tool for creating, allocating, and defending property rights, not only for westerners, but all ~8 billion global citizens.
In traditional financial systems, property rights are often subject to the whims of intermediaries such as banks and governments. These intermediaries can freeze or seize assets, impose capital controls, and limit the ability of individuals to transact freely. By contrast, Bitcoin allows users to hold and transfer value without the need for intermediaries, giving individuals greater control over their assets.
7.) Freedom. There is a sense in which the human story is a fractal pattern of individual and collective journeys directed toward higher perceived freedom. The collective path is a macrocosm of the ups and downs of an individual life. No rational person(s) desires less freedom. Quite the opposite, the hope of higher freedom for ourselves, or at least for our people, is what gives us hope for the future. This hope is enough to justify extreme sacrifices at every scale and the stories they generate are maintained to create culture.
Freedom is the high aim of Bitcoin. It is at this target the protocol blasts its power on behalf of all who summon its force. Freedom to work, to save, to transact. These basic categories catch all of human action. Removing the freedom of one, obliterates the freedom of the others. This trinity of economic freedom is what Bitcoin was created to propagate and defend.
In this way, Bitcoin solves half our problems. Yet freedom remains a complicated matter and the spiritual component weighs even more heavily than the aforementioned. For that exploration we will require another Essay.
Having covered the underlying philosophy, economics, politics, and values which together constitute ‘The Bitcoin Worldview’; we now have a general understanding of the key ethos, motives, and aspirations of the protocol and the users who wield it. There is nothing more potent than an idea whose time has come and Bitcoin is such an idea. You don’t change Bitcoin; Bitcoin changes you.
This is Jonathan David Kellogg – Writing for
That Bitcoin Blog.
These are The Bitcoin Essays.
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