Bitcoin
Bitcoin is ‘resistance money’ | AIER
Bitcoin looks different to everyone who observes it, a modern parable of the blind man and the elephant.
To economists, it seems inferior money since there is no a supply response.
To regulators, it seems sneaky money laundering attempts and evade taxes.
To the general public, it looks something like the hideous offspring of financial speculators and technology preppers. Most people therefore ignore this.
With Resistance Money: A Philosophical Case for Bitcoin by Andrew Bailey, Bradley Rettler, and Craig Warmke, philosophers have entered the arena. The trio, professors at Yale-NUS, the University of Wyoming and Northern Illinois University, consider nothing more important than bitcoin and have consequently ended all their other research agendas. After some initial research articles and reports (here, hereIt is here) — including, for outreach, an AIER workshop sponsored by the Bitcoin Policy Institute — a book was inevitable.
“This is by far the most difficult and important intellectual project I have ever completed,” Bailey said a few months ago about the book, released this week by the academic publisher Routledge. It is a calm and serious book, accessible to curious beginners and those who have not yet sold Bitcoin as a quick solution for all the ills of society.
Bitcoin is, in John Oliver’s famous words, “Everything you don’t understand about money, combined with everything you don’t understand about computers.” Some technical explanations are inevitable, but the reader is not subjected to an avalanche of technical nonsense, nor to impassioned battle cries that approach sales pitches.
The authors openly say that they own bitcoin and think it is a benefit to the world. This confession should not dismiss his many arguments. The looking approach financing or financial incentives and dismissing arguments along these lines is lazy: “We humbly assert that crude criticism turns things around. We defend bitcoin because we believe in it after years of study; we haven’t studied bitcoin in years because we own bitcoin.” Therefore, “our arguments stand or fall on their merits.”
And there is a lot of merit. The authors do not exaggerate, as many bitcoiners tend to do, but they situate their argument right from the start:
“Despite the hopes of many bitcoin diehards, it will not end war, restore the traditional family, or fix the housing market. It will not improve nutrition, inspire a return to Renaissance-style art, or revive 19th-century architecture. Bitcoin doesn’t solve everything. It fixes some things – and even breaks others.”
Definitely criminal
What many people believe about bitcoin is true: it is for criminals. But it is also for freedom fighters, for those who are cut off from the global monetary system, for those who are kept financially ostracized by the laws or customs of their lands. It’s for Russian or Nigerian dissidents trying to receive and spend funds, it’s for Afghan women under patriarchal rule, it’s for refugees trying to cross a border with their (financial) assets intact. It is for Westerners, who try to escape the worst consequences of inflation, for marijuana dispensaries whose business is legal in the states where they operate but illegal at the federal level (and therefore unable to make use of the banking system which is under heavy control and centralized).
In fact, all of these uses are the same thing – many parts of the same elephant. The nature of money is to be usable between enemies who otherwise cannot trust or force each other to behave. (Friends can use credit and favors.) It is a bearer instrument that does not require identification, bank account or government authorization.
“Bitcoin,” Bailey, Rettler, and Warmke write powerfully and succinctly, “is resistance money.” It is a monetary way of opting out, of avoiding obstacles. No wonder criminals like it too.
Resistance Money is not a libertarian book, singing the free-market case for bitcoin or reflecting on the collapse of the dollar. These books exist. The trio, are explicitly not libertarian, instead, try to create something bigger. They investigate not whether the things that bitcoin breaks are worth breaking, but “whether we should prefer a world with bitcoin to a world without bitcoin.” They do so with prudence and meticulousness, using the philosophical tool of The Veil of Ignorance by John Rawls.
Assuming you don’t know who you are, what country you were born in, and what your skills, interests, and opportunities are (that is, trying to strip readers of your monetary and financial privilege) — would you still support the existence of bitcoin?
Under the veil framework, the authors attempt to make as close to an airtight case for bitcoin as possible. This is admirable and valuable. Not seeing a problem with censorship and financial oppression is equivalent to believing that only Bad People™ have problems with (benevolent) authorities. In reality, “good guys and girls are often censored as well.”
Resistance Money asks you to look further back in time and across the world: “If you could imagine yourself in a position where you would need resistance money or need to teach someone else how to use resistance money, you would be wise to learn how use bitcoin.” This is the reality for some four billion people who live under authoritarian governments that restrict, capture, oppress or otherwise punish dissidents for doing or saying the wrong things. Freedom money, wielded by its users and resistant to capture, identification and censorship, does not dispel unjust laws or make bad rulers disappear – but almost nothing else does, so it is an unjust standard. The use of bitcoin makes it much more difficult to spend and move money for these governments.
This is an obvious improvement, a benefit to humanity. Bitcoin is freedom money, a escape hatch under the heavy boot of a tyrant. Behind the veil, we have a good chance of being one of these people.
Still, this framework is a little too low level. For an economist, it is certainly an undemanding construction: expanding the set of decisions and available opportunities can more or less benefit only the users (independence from irrelevant alternatives). More options are better. Given different individual preferences and circumstances, the state of the world with bitcoin is an improvement for some. Therefore, it is quite trivial to conclude that it is better for these people to have access to bitcoin than not.
A world with bitcoin has some costs. There is a certain amount of money laundering, ransomware, and diversion of government income through taxes and seigniorage that wouldn’t have occurred if something like bitcoin had never been invented (well, uncovered…). The authors admit that such things, to the extent they are enabled by bitcoin, are negative for the world, but that they are “not a serious threat to the overall net benefit of bitcoin to the world.”
In a sense, Resistance Money is the natural continuation of Alex Salter, Pete Boettke and Dan Smith. Money and the Rule of Law.. “As far as monetary institutions are concerned,” write Bailey, Rettler, and Warmke, “bitcoin brings the rule of law to the world of money and is an attractive alternative and optional money, especially for the billions suffering under bad conditions.” conditions. monetary rulers.”
And they are quite radical regarding the implications of this monetary institution:
“Bitcoin is a monetary institution that aims for predictability and radical disintermediation. It exists, not to seek price stability or full employment, but to completely eliminate the need for money creators, mediators and central managers.” We need serious books about money and bitcoin. ResistanceMoney is exactly that.
Book of Joachim
Joakim Book is a writer, researcher and editor on all things money, finance and financial history. He holds a master’s degree from the University of Oxford and was a visiting fellow at the American Institute for Economic Research in 2018 and 2019.
His work has been featured in the Financial Times, FT Alphaville, Neue Zürcher Zeitung, Svenska Dagbladet, Zero Hedge, The Property Chronicle and many other outlets. He is a regular contributor and co-founder of the Swedish freedom website Cospaia.seand frequent writer in CapX, NotesOnLibertyIt is HumanProgress.org.
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