I don’t claim to know heaps about Bitcoin, I’m interested in it (hence all the bitcoin news you get), but I know I have a long way to go in terms of really understanding both it and the subculture around it. But look, here’s another take. A take which is simply based on the idea that anything created in society takes on the views and values of that society. For something to become a structure, it is always structured by other structures. You see? Bourdieu is proud.
First, take this fascinating essay on the Rise and fall of the house of Bitcoin:
After all, how can a technology revolutionize society if its creators won’t explain what it is? Read the full story by @leomschwartz and @luciacholakian r
Blockchain (the technology that Bitcoin uses) and Bitcoin are both attempts to decentralise:
Ever since a coder calling himself Satoshi introduced Bitcoin in a 2008 white paper, the prospect of a decentralized, peer-to-peer monetary system had become synonymous with a potential new world: one controlled not by banks or governmental institutions but by anyone with access to a computer.
PLUS there’s a lot of interesting other ways that blockchain can be used to decentralise and legitimise other aspects of society: How Bitcoin’s Technology Could Revolutionize Intellectual Property Rights
Part of the process of decentralising is changing where something derives its value. We value money because we live in states and usually money is some sort of state-sanctioned currency. Creating non-state sanctioned currencies means that we have to find the value of that currency in something else to legitimise it. Bitcoiners like to talk about the ability to trust the Blockchain technology entirely to validate a transaction. You don’t need a third party state or bank to validate whether your money exists or not, you just need the digital representation of it in Blockchain’s history. Here’s where I worry that I’m getting too simple: is the point of Bitcoin simply that it exists? Is this new currency the ultimate objectifier? Does it eliminate the need for relationships at all?
Money isn’t just what we use as a medium for exchange, but we give it different values that exist also in other parts of our lives. This, from the first article I read in economic anthropology, The Social Meaning of Money: “Special Monies”’ by Viviana A. Zelizer:
Classic interpretations of the development of the modern world portray money as a key instrument in the rationalization of social life. Money is reductively defined as the ultimate objectifier, homogenizing all qualitative distinctions into an abstract quantity. This paper shows the limits of such a purely utilitarian conception of “market money.” A model of “special monies” is proposed to examine the extraeconomic, social basis of modern money. The article argues that, while money does indeed transform items, values, and sentiments into numerical cash equivalents, money it- self is shaped in the process. Culture and social structure mark the quality of money by institutionalizing controls, restrictions, and distinctions in the sources, uses, modes of allocation, and even the quantity of money.
Lots of things are valuable to you. You have a relationship to a thing, and someone else has a different a relationship to that thing. This is the basis of how to think about property rights: the relationship between two or more people with regards to a thing. Beyond that, we can ask other questions: who gets to be in these relationships? Who do you like to enter into relationships with and who don’t you like to enter into relationships with? Which third party can take away your thing, even if there is an established relationship? How do you account for all the different ways that people can communicate to establish, continue, and end relationships with regards to a thing? I hear there’s a whole portion of law dedicated to this.
So, if I’m not being too simple, what people value Blockchain for money and IP is its existence, the fact that it can mediate the relationship between two or more people with regards to a thing and establish a level of trust that you don’t always get through knowing a person or institution. You can trace a thing because it is written in code, not because you know all the people and relationships behind it. It takes away a lot of these issues with relationships in property. I see why this is the Holy Grail of decentralisation.
But it’s not. To exist in society is to have been created in society. Yes, I’m aware I sit somewhere between Heath Ledger’s Joker and Jared Leto’s Joker. We do live in a society. Let’s go back to that first quote:
the prospect of a decentralized, peer-to-peer monetary system had become synonymous with a potential new world: one controlled not by banks or governmental institutions but by anyone with access to a computer.
Not everyone has access to a computer. First and foremost, you are advantaging some people over others because of access. And so many factors control that access that are beyond the scope of what Blockchain and Bitcoin can offer: the decentralisation that they offer is predicated on the centralisation of an electricity grid, internet access, political freedom, economic and time freedom, knowledge, likely the ability to understand English, news access. Besides, anything decentralised properly creates something else that is central in its place. They know that:
When [Aráoz] does engage with his former life [of running crypto-companies], he’s usually ranting in English against the economy or encouraging his followers to hoard their Bitcoins. “Democracy expired, let’s get on with the next thing,” he recently tweeted.
Beyond this, we have to question what is being decentralised, and to whom is it central? Coming back to the article on Blockchain and IP:
Verification is example of the block chain’s potential outside of just monetary innovation.
That’s something venture capitalist Fred Wilson is interested in, and recently said:
“Right now you need someone to be the arbiter of identity — either Facebook, Twitter or Google […] I think you could do the same thing with a block chain architecture.”
We are already dealing with crises of identity on the internet. We have people (and me, in previous newsletters) questioning what it is to exist in a moment on the internet and have that moment be immortalised forever. I keep coming back to the IP question because there are already so many issues within IP about what values should derive from what we view as existence: what about people who don’t have access; what about people who don’t conceptualise ownership over something in the same way that the writers of IP law have; what about people who don’t have a writing tradition but an oral tradition instead, and if you are going to write that down, who gets to control what narrative gets written? What about the value of the changing oral narrative over time? What about the value of culture: the social adaptation of people over time? What happens if everything exists in a record?
Blockchain exists in our society, and it cannot, in and of itself, level out the playing field of society. Bitcoin, like money, cannot be the ultimate objectifier because we’re humans, we create, we value, we objectify, we subjectify, and we change.
