What Is the Essence of Bitcoin?
Getting to the Essence of a Matter
If you were to ask the question “What is man?” you might get a clever reply like “Mostly water.” Such an answer wouldn’t be incorrect, but it would hardly be useful. It wouldn’t, after all, tell you the difference between a man and a watermelon or a cup of tea, all of which are mostly water.
If you go deeper and ask the question “What is the essence of man?” you’re in for a very long discussion. That’s a discussion that has been going on for thousands of years. I’ve personally done a lot of thinking and discussing about this topic, in large part because I want to understand what it is I am.
I’ve also been doing a lot of thinking about the question of “What is the essence of Bitcoin?”. I’ve been asking this because I am fascinated by Bitcoin, and also because I think Bitcoin is a reflection of some very particular things about man and his essence, so asking questions about Bitcoin actually provides answers about the essence of man and mankind as well.
Essence Lies in Understanding Fundamental Distinctions Between Things
I’m going to rely heavily on using hyphenation followed by the word “like” to get to some aspects of the essence of things in this article. When I say something is, for example, “life-like”, I am specifically saying that it is not exactly alive, but that it is more like living things than non-living things. A lot more.
Why can’t I just say something like Bitcoin is or is not alive? Because a term like “life” applies to things on Earth we are very familiar with and Bitcoin is different. While there do exist “edge cases” of what may or may not be alive, like viruses, it is mostly easy to look around at things and see what is alive, what was once alive but is now dead, and what was never and will never be alive.
By the way, this article won’t talk about whether or not Bitcoin is life-like. That’s not the essence we’re after.
Two Realms For Humans: Ecology and Economy
Since I’ve already thrown out the term “life-like” I want to talk about something that is life-like.
A company is life-like. It is founded (born), it operates (lives), it grows, it adapts, it learns. It may give birth to other companies, it may merge with other companies (which in life is something slime molds do, but not humans). It cooperates with other companies and competes with others, sometimes to the bitter end (death). It is itself a process that consumes and produces something, and it eventually comes to a demise — a death-like event. A company even has departments which are organ-like, performing a particular function necessary for its overall health.
A company consumes inputs and converts them into outputs which are part of the economy. This then shows us another entity, the economy, which we could describe as being ecosystem-like. As companies are to living things, the economy is to the whole ecosystem.
We can view a company’s inputs as food-like and its process of making whatever it is that it makes as digestion-like and metabolization-like. We can view the money it spends as being expending-energy-like and we can view its storing of money as storing-of-energy-like.
In the actual life-realm — the ecological one, the ecosystem — living things use energy to try to capture more energy than they are using, because that is how they survive. In the economic realm, companies try to capture more money than they are using because that is how they survive.
Also, in the economy, it’s not just companies that store energy and expend it using money. Humans do it too.
Humans participate in both the ecosystem of living organisms and within the economy. They store and expend actual energy in the ecosystem and they store and spend monetary-energy in the economy.
We humans straddle both realms — the ecological realm and the economic realm. In the ecological realm energy is energy. In the economic realm money is energy-like. But let’s be very careful — money isn’t actual energy.
Money is just an agreement to exchange actual energy. A pile of money doesn’t do any work. It isn’t energy. Only people and companies who accept money in exchange for work do the actual work. Put a pile of money in the middle of a table and ask it to mow the lawn and nothing will happen. But ask a person to mow the lawn and offer them some of that money and they just might agree to it.
The Essential Difference Between the Two Realms — Taking vs Trading
Money isn’t actual energy. It is an offering from one participant in the economy to another participant in the economy to trade energy for that money. This is not like anything we see in the ecological realm. In the ecological realm, participants don’t offer anything as a trade. In ecology living things take energy and give nothing in return. Plants take sunlight and give nothing to the sun in return. Animals eat plants and give nothing directly in return. Animals eat other animals and give nothing in return.
In fact, the economic realm exists apart from the ecological realm ENTIRELY and ONLY because of MONEY! Money is the invention that says “Instead of taking without giving, I will trade something I have for something you have.” Since barter doesn’t even work in small scales, it is only money that allows this realm of trade — the economy — to exist.
Every magnificent thing we see around us that is man-made is possible only because we invented money and found a way to work cooperatively through trade instead of operating as animals do by taking things without giving anything in return.
That is what the economy is: Replacing the brutal, merciless, life-and-death use of force with trade!
Note now the essential distinction of how economic participants are not life-like. They don’t have to kill and eat others to grow, thrive and ‘survive’. They have to find others economic participants willing to cooperate.
This is a distinction many people are not fully aware of. We do after all talk about competition in the economy and it sounds an awful lot like competition in the ecosystem — both have this notion of survival of the fittest. But there is a big difference.
Fitness in the ecosystem means you take energy without giving anything in return. The plant takes from the sun. The herbivore takes from the plant. The predator takes from the herbivore. In the economic realm though you take nothing. You instead trade. You give your product in trade for money — or vice versa.
Trade Is One of the Essences of Being Human
This is one of the essential distinctions of man from all the other living things. Only man is capable of trading like this. And it is from this capacity to trade that one crucial element of the essence of man comes into focus.
Man can take AND ALSO GIVE. When he gives something in exchange for getting something in return that is what we call a transaction. For that to happen at any scale, we need money. Money is something one gets that one can then use to trade with yet another person. Humans don’t need to take from each other by force because they can trade.
A Very Important, Yet Brief, Aside:
I want to bring up a third “mode” in addition to taking and trading. I do this for completeness because it is another important feature of the essence of man that would be terrible to leave out at this point, but which does not have anything directly to do with money.
It is this: If the ‘law of the jungle’ is that living things take energy without giving anything in return to the source of energy, and the ‘law of the economy’ is that participants trade or transact to only take what their counterparty is willing to give in fair trade, then there is a third possibility. The third possibility is of actually giving without taking or asking for anything in return.
- there is taking energy without giving back — the law of the jungle;
- there is taking one form of expended energy and giving back unexpended energy, usually using money — transacting, or the law of the economy; and
- there is giving energy without taking or expecting anything in return. For now, I’ll call this third mode gifting.
I’ll have much more to say about this third mode, including giving it a different name, in a future article in this series. I’m not going to go into it here, but I don’t want any reader of this article thinking that you are limited to dealing only by force (taking) or mutual exchange (trading). Since this is about Bitcoin (or it will get to be very soon at least) please take note that Satoshi gave the world Bitcoin and asked for nothing in return.
Back to Our Main Topic: Fairness and Justice are Concepts of Trade. Human Morality Arises From Trade.
Thanks to trade, or transactions, enabled through the invention of money, we have found a way to thrive and survive that other living things have not — trade is something distinctive about mankind.
Trade in fact is where the very idea of “fairness” or “justice” comes into play. There is no notion of fairness or justice in the ‘law of the jungle’. In the jungle, you can and are expected to kill in order to survive. In the jungle you are expected to fight for your life or get killed by something else.
In the economic realm you do not use your energy to kill other economic participants and you are not killed by them for your energy. You are expected to use your energy to produce something of value to others and to trade it with them for something they have used their energy to produce which you value.
Look at every element of our “moral code” when it comes to dealing with other humans:
Don’t kill — don’t obey the law of the jungle.
Don’t steal — do obey the law of the economy.
Don’t initiate the use of force against others — don’t obey the law of the jungle.
Don’t lie — do not misrepresent what you are giving in trade in the economy (fraud is one of the few types of lies which we have actual laws against).
These above “don’ts” are the laws we pass to enforce our morality.
The “dos” are the positive, permissible and recommended moral actions:
Do live and let others live. (That’s directly against the law of the jungle.)
Do trade fairly with willing counterparties. (The law of the economy)
Do act peacefully towards others. (The law of the economy)
Do tell the truth: about what you are capable of, about what your product is, about the integrity of your money. (Be honest in trade within the economy)
Whether you’re religious or not, this moral code is the code that the vast majority of humans believe in, and that everybody, even those mainly evil humans who regularly kill, lie, steal and cheat, don’t dare deny — they just try to find ways to work around it.
Money’s Essential Role in Human Morality
Take note that we need money to be moral on a large scale with large populations. We cannot live a life without stealing unless we have money. Stealing requires the initiation of violence, so we cannot live a life without violence without money. If you think hard enough about it you’ll see we cannot live a life without killing without money — and if you just look at history, you’ll see that when money collapses, a lot of killing ensues.
I want to stress this again:
HUMAN MORALITY AT ANY SIGNIFICANT SCALE— THAT OF TRADING INSTEAD OF TAKING — IS NOT POSSIBLE WITHOUT MONEY!
So if you ever hear someone say that “money is the root of all evil”, or that the “love” of it is, I hope you’re prepared to counter with: “No. Money is needed so we can eliminate the need to do evil.”
Which finally brings me to our friend, Bitcoin. Well, almost.
The Immoral Humans
There are people who don’t act morally. The law of the economy is not a necessity by nature. It asks that you do work and trade your work for the work of others, using money. Since it asks rather than commands, there are people who disobey it. I’m not talking here about people who just steal something and run away with what they took. I’m talking about people who try to distort mankind’s morality — the code which says that trading work for work is fair and good and moral. These are people who want to take from others without giving anything in return, and who attempt to justify doing this even though it is unjust to do it.
Now, since morality has so much to do with the economy, it should come as no surprise to you that many of these immoral people call themselves “economists”. They are trying to, after all, rewrite the law of the economy to introduce their immoral rationalizations into it. They have learned that there is no better place to attack morality than from within, and that means attacking economics.
They have tried to pass off a different moral code to try to cover up their immorality by saying it is okay to take: to steal, to initiate violence, to even kill — in short, to act according to the law of the jungle. They say this is fine as long as they’ll gift some of what they take to people who they say are in need of it. They do not talk of trade.
They implement this immoral code through the mechanisms of politics and altering the laws of our civilization — laws that were supposed to enforce morality, but which they re-write to enforce this distortion of it.
At first these distortions of morality were acknowledged as immoral, but were said to be small and necessary — “A temporary and small 1% income tax” as an example. We of course all know what happened to both the temporariness of this tax as well as its share of the total income.
Distorting Morality Through Distorting Fairness
This distortion of morality ultimately manifests through distorting the idea of fairness. What was deemed fair before this distortion was an arrangement where someone agreed to voluntarily exchange some things with someone else, usually with one side exchanging money — a ‘fair’ trade. Now, instead, these economists and politicians talk about everyone having to surrender their “fair” share, in exchange for nothing. Anyone not surrendering their fair share violates some law, and there’s at least one huge agency that will ensure you’re caught, prosecuted, have that “fair” share seized by force, made to pay a fine, and perhaps even be thrown in prison, your freedom taken away by force. That seems to me to be very law-of-the-jungle-like.
This distortion of the concept of fairness has been very effective. Many people are persuaded by it, especially the young and other people who have never yet had the opportunity to do honest work in exchange for honest money. That, by the way, is why economists teach economics primarily to young people who haven’t ever worked for their money. It’s much harder to deceive people with moral experience about what is and isn’t moral.
Note that we now don’t even have a word in the language for actual fairness . Not anymore when fairness now means “Take by force from those who have to give to some who do not (while also taking a huge cut for yourself along the way).”
As this immorality has spread it has taken over more and more of our civilization. After taking over the professions of economics and politics, the immoral class completely took over money. Now that central bank fiat currencies exist, the immoral actors don’t even have to seize the wealth of the producers directly through taxation. They now just print or digitally conjure into existence money and give it to themselves. “Quantitative easing”, or “treasury asset purchases” are really just confounding labels for stealing and lying.
These policies, to be clear, are not about making the “rich richer”. They’re about making the immoral class richer. There are many rich yet moral people — people who have worked hard and produced something valuable and traded it voluntarily with people who wanted it — people who obeyed the law of the economy. There are very many moral people. However, there are very few moral politicians, lobbyists, economists and law-makers left, because those professions have been deeply corrupted.
Bitcoin: Stopping Immorality in Its Tracks
Why has Bitcoin become a rallying cry for freedom, justice, fairness and moral action? Because Bitcoin is an invention that cuts through the lies of the immoral class and takes away the power they have captured over the last fifty years:
Bitcoin says “Seizure by force is theft and is immoral and I am enforcing the economic law of don’t steal with the inviolable law of math.”
It says “Theft through inflation is immoral and I am also enforcing the economic law of don’t steal through a supply cap with the inviolable law of math.”
It says “Trading work for money is moral and I am enforcing this by allowing the creation of (the strictly limited supply of) money only with mathematically proven performance of work.”
It says “Lying is immoral and every statement in my records will be mathematically provable to be true.”
Finally, it says “Everyone is entitled to participate in this moral system”. It enforces this by sidestepping any possible attempt to restrict participation, again using inviolable math. In this case it simply says, “To participate, all you need is a large random number, which you can even make just by tossing a coin many times if that’s all you have.”.
Bitcoin Has the Immoral Class in a Complete Panic.
Bitcoin does not listen to economists’ lies of “It is moral to take without giving anything in return”.
Bitcoin does not listen to the politicians who promise to take from some and give to others in exchange for votes, yet who are really after cushy entitlements and getting to join the higher paid ranks of the immoral class.
Bitcoin does not listen to central bankers who lie about who their policies enrich and what they are actually up to.
So these people are all freaking out.
Bitcoin enforces true morality, true fairness, true justice, through math and says to the immoral class “You have no power here! Your lies have no power here!”
So the immoral class is scrambling to keep their power. They may try to outlaw Bitcoin. They may try to create a distorted immoral version of it (what they call a CBDC). They may try to capture Bitcoin through regulation. They may try to discredit it by publishing papers saying it is immoral because it doesn’t let them steal, and so on. They may bring forth corrupted ‘experts’, ‘scientists’, celebrities, and whatever else they can think of.
They will fail in all these attempts because Bitcoin operates on laws more powerful than the law of the economy, which only politely asks that you not lie, or steal, or kill. The true laws of the universe are those of mathematics and physics, and Bitcoin is enacted and enforced using those laws.
The Essence of Bitcoin: Enforcing Moral Laws Which Can Be Broken Through Inviolable Functions Which Can’t Be Broken.
This is the essence of Bitcoin that this article is about: Bitcoin enforces proper human morality in the economic realm through math and physics and disarms the immoral class from perpetrating their immorality.
Note how the first politician in the world to make Bitcoin legal tender, Nayib Bukele, one of those rare (at least sometimes) honest politicians ran on a platform that said “There’s enough money when no-one steals”. He said that honestly. He was effectively saying “Let’s obey the law of the economy to not steal”. It led him straight to Bitcoin.
Bitcoin Changes Everything That Is Economically Immoral
Bitcoin doesn’t need politicians to support it, but because it is an unstoppable moral force it will lead to the demise of politicians who rely on an immoral code to abuse power. The same fate is in store for central bankers and economists.
The immoral class has become too big and is exacting too high a toll on our civilization for it to continue to function. They are parasites and they have become too many and too greedy for their host to suffer them any longer — that host being a moral civilization of moral-acting people.
Fortunately, we have the cure. Just as you must take a pill to kill off an infection of parasites, you must take this pill, the orange pill, Bitcoin, to cure yourself of the infection of the immoral class.
The immoral class have overplayed their hand. They have become too greedy. Their schemes are failing. Their lies are exposed. This whole class is exposed as immoral; as violators of the law of fair trade which is what distinguishes humans from other living things and which is our basis for human morality.
It is Bitcoin that lets us peacefully unwind this doomed, runaway, economic immorality, without suffering complete economic collapse.
The immoral class should actually be grateful to Bitcoin. They are not the first immoral class of this nature in history. The rule of such a class has always ended in economic ruin for the nation, including economic ruin of the immoral actors, and often also with the executions of the perpetrators of immorality. This time, their lives, although not their immoral livelihoods, will be spared by the transition to Bitcoin. Lucky for them.
It Is Just a Matter of Time
How quickly Bitcoin replaces the corrupted, immoral system with a truly moral system is uncertain. It may happen very quickly — largely because the fact that in acting with increasing desperation to save their collapsing system the immoral class is actually accelerating its demise and making room for Bitcoin to become adopted more quickly.
There are many variables at play. However, what is not a variable is the fact that the laws of math and physics have primacy over any man-made laws. So no matter what laws they come up with, the immoral class will not be able to stop Bitcoin.
We Can Make It Happen Faster
In an ideal world, the immoral class would accept defeat and stand down. They would beg forgiveness. We don’t live in such a world.
So we must stand up:
Run a Bitcoin node.
Convert your fiat money to bitcoin.
Accept and spend bitcoin.
Learn how to use the Lightning Network.
Be moral — obey the laws of the economy.
Don’t let yourself be intimidated.
Don’t let yourself be fooled.
Be part of restoring morality to our civilization.
If you are in the pay of this immoral class, begin to find your way out of it, because it’s going away.
Bitcoin cannot be stopped, and that’s a great turning point in history in favour of the good.