Bitscam II
Anger is an energy, so said Mr. Lydon. That's absolutely true. Anger is a very important emotion with deep roots in the human animal. Instinctively social animals, a sense of fairness is hardwired within us. Anger bubbles up for a number of reasons, maybe most importantly surfacing when a person perceives they are unfairly treated.
To live in America today, it's difficult to not be perpetually angry. Inequity is ripe in almost every aspect of life. However, as anger is an energy, to be endlessly angry is neither good for the individual or society. So, you learn to moderate, but hopefully without becoming numb or submissive to the point of servitude.
In beginning of 2009 at the depths of the last financial crash, bitcoin appeared. I read the paper, understood the technology, and boy it pissed me off. I had spent many years unsuccessfully trying to get people to think a little about the money system, which was becoming ever more undemocratic. If you want democracy, you need some sort of democratic money system, and the established money system was not democratic, nor was bitcoin.
But bitcoin was another new, shiny, bright bit of tech, coming with all the propagandized advertising of the last half-century tech marketing – freedom, liberty, and wealth. Funny thing or maybe not so, you'll notice one thing this tech revolution has little promoted – democracy. This is not an accident. Many of the most tech fluent neither understand democracy or care much about what they do.
The thing that really set me off with bitcoin was its completely archaic and idiotic notion of comparing money with gold. If you spent any time studying the history of money, you realize gold is the least democratic currency, especially by the time of the Industrial era, where controlling the always very limited supply of gold gave you control over any money system based on gold.
Bitcoin specifically called its creation process “mining,” but instead of exploiting the mass labor of the bottom of society digging through rock, bitcoin uses electricity for the opening and closing of billions of transistor gates for its creation. Phillip Dick was wrong wondering about the dreams of androids, they never sleep, they just mine more bitcoin, or until there's 21 million anyway.
The great, initially discomforting realization about money is that it’s all created. The creation process is the most fundamental power lever of any money system. For modern bank-debt money, this power has largely been delegated to the banks, they create money. Certainly, the last 14 years saw the Fed create loads of money, but the Fed is basically the banks. With the creation of the Fed only a hundred years ago, the banking system increasingly consolidated. The American money system became ever less democratic.
So, bitcoin played on this, well, you couldn't call it a popular understanding, but certainly a popular feeling of inequitable power reinforced in the last financial collapse as the entire political class and government rushed to bailout the banks despite their criminality.
The final big sell of bitcoin is as a distributed technology, no one controls it. This was like the PR used at the beginning of the internet – decentralized freedom, liberty, and wealth – again not much about democracy. Of course just as with the internet, it was soon learned bitcoin's not quite distributedly controlled. That's not to say like the net, the blockchain coding doesn't have some distributed aspects.
This wasn't a new technology, the bit-torrents and other various software apply similar architectures. Ay, there lies the rub, if you want truly distributed systems, and anyone wanting democracy must insist, the entire architecture of the system, the hardware too, needs to be distributed. And most importantly, missing completely from this information technology revolution has been any innovation in the structures of associations, that is of the human social organization which the technology is part.
Two things have been most amusing about bitcoin. There came a realization by more persons than ever before that all money is created. So hey, if we're gonna have liberty, freedom, and wealth, we can all create money! Second, all sorts of things like banks and other old financial traditions started “evolving” in what the NYT most humorously called the “crypto-ecosystem,” including margins. It seems everyone with any bit of worthless crypto is leveraged 10, 20, or high as you can go into insolvency. Lord, no wonder the big banks all came flying-in over the last few years.
Well, we're having another teachable moment about money. The last one taught nothing. Don't hold your breath about this one.
May the road rise.