Bitcoin is unfair. That’s the point and so it shall remain.

Some New Yorker over at The New Republic recently wrote one of the most misguided, late-to-the-party, pitiful pieces of journalistici wankery I’ve read in months. I’d honestly thought that such derpage was dead and buried, but since this doesn’t appear to be the case, for your enlightenment and entertainment, I’m going to address of few areas where Mr. Nathan Schneider goes off the rails in After The Bitcoin Gold Rush :

The search for riches in the ground has motivated some of history’s most extravagant endeavors. It has inspired explorers, enslaved populations, and put opera houses in dusty mountain towns. But when the boom ends, the miners themselves have often been left in the lurch. They handle the raw material, turn it from hard earth to something potentially of value. Fabulous wealth comes to only a few, who rarely hold onto it long enough to be considered lucky. The search for bitcoins is little different.

Yes, the search for new lands has rewarded those brave enough to venture off the edge of the world, where the horizon ends and the oceans tumble over the planet’s precipice into the vast emptiness of outer space. This is in fact the very same world that created the art, architecture, heroes, and stories that we still appreciate today. The ones we still vacation to Europe for just to catch a glimpse of that bygone splendour. This is the world that rewarded risk just as severely as it punished it.

Also, yes, we agree that the problem and promise of fabulous wealth is an obstacle in Bitcoin just as it was in the wild west days of gold mining – being early,ii holding on to your winnings, dodging wallet inspectors, keeping private keys safe… Many started out on this journey, far fewer survived. Just as it should be.iii

Those miners left in the lurch after the dust settled, those whose corpses lined the ditches along the road up towards Victory Mountain, are but the hangers-on of history, the also-rans, the redditards. They’ll be able to say “I was there” and nothing more. History forgets such accidents.

Yes, this is also exactly how derps see “lucky” people. “Oh, you’ve been successful at investing for 15 years, you’re just a lucky punk with no skillz !” etc. Come to think of it, casinos must be the luckiest businesses around ! That house edge that they enjoy is pure good fortune ! I mean, there’s no possible way it’s by design, right ?

Nick Spanos founded the Bitcoin Center a few hours before New Year’s Eve in 2013. He is a New York City real estate broker who learned about Bitcoin “pretty early,” he says, at a libertarian meetup.

Speaking of accidents and those who aren’t so “lucky,” you’ll recall that Nick Spanos “knows everything there is to know about Bitcoin” despite the fact that he hasn’t, to my knowledge, completed his 6 month certification. Spanos is therefore an absolute nothing. In fact, even if he and “The Bitcoin Centre” started out as something, doubtful though this is, he’s pissed the last two years and God knows how many coins into “the community.” Because that’s how everything works, isn’t it ? Well, yes, but only if you ignore causes and beeline straight for your own imaginary purposes.

He envisioned his storefront as a beachhead for Bitcoin in the heart of the Financial District, but it has been losing money as he waits for government agencies, such as New York’s Department of Financial Services, to decide how to regulate virtual currencies.

“Oh please Mr. Government man, please let me run a business so I can feed my children myself, so y’know, I don’t have to go on food stamps to leech off of the people who already have your approval to eat.”

Bitcoin can’t be regulated anymore than the clouds can be regulated. The NYDFS knows this, which is why they choked to death on their braindamanged “BitLicense” proposal.

“I feel like a martyra Bitcoin martyr,” he told me. “We’re bleeding out.”

Yes, you are, Spanos. Just like everyone else who sympathises with your stupidity and pretends like Bitcoin doesn’t already have its own established hierarchy, all there is for you to do is bleed out and go off quietly into the night.

But for anyone invested in a commodity whose value depends on confidence, spreading pessimism can be costly. Without much conviction, Spanos insisted that Bitcoin “is going to change the world.”

Fuck Nathan with a spiky cactus branch. Seriously. It’s motherfucking fiat, not Bitcoin, that depends on confidence. It’s fiat, not Bitcoin, that’s so unbearably susceptible to pessimism that its central bankers are reduced to PR muppets who hold press conferences three times a week !iv

It’s Bitcoin, not fiat, that’s based on immutable maths. It’s Bitcoin, not fiat, that’s a force of nature. It’s Bitcoin, not fiat, that doesn’t give a shit whether you like it or not.

I mean really, can you honestly think of a less consumerist, less democratic underpinning for an economy ? Because I can’t for the life of me. And whether you like it or not, it’s happening. Bitcoin is here and there’s no putting pandora back in her box. So just like everything else that’s out of your power to change, be it the colour of the morning sky or the shape of a crocodile’s toes, you might as well enjoy it !

Bitcoin was supposed to usher in a new, global economygold for the Internet age, managed not by a central authority but by infallible algorithms running on the computers of those who use it. [...] But the Bitcoin revolution has begun to look more and more like the system it was intended to replaceexcept perhaps more centralized, less egalitarian, and even more clogged by unseemly interests.

Ok, this is completely contradictory and entirely ignorant of what the gold standard meant in praxis. To recap : Bitcoin looks nothing like the fiat system it intends to replace and that’s because, not except, because it’s more centralised and less egalitarian. I don’t really grok what “unseemly interests” is would seem to map to something vaguely socialistoidian, which is to say that Bitcoin doesn’t give away free shit to people who didn’t earn it. This is true, very much the point, and very much a return to the gold standard. But I suppose it isn’t “fair” by the post-post-modern definition. But what of it ?

Mining, especially, was supposed to be an act of democracy. On the P2P Foundation’s online forum, Bitcoin’s pseudonymous creator Satoshi Nakamoto wrote, “The root problem with conventional currency is all the trust that’s required to make it work.”

Satoshi was referring to the trust required for transactions. Sorry Nathan, but you don’t get to misrepresent facts anyway you like because reasons. Mining Bitcoin was never “supposed to be an act of democracy,” at least not in the sense of a full-franchise democracy you’re thinking of. Bitcoin is more aristocratic than anything else. For which, for all the art and splendour that is to come, and in advance, you’re most welcome.

Nakamoto designed Bitcoin to resemble gold in more ways than onea finite supply, its value backed by its scarcity and the energy required to extract it. This was unquestionably a breakthrough. For the first time, the technology underlying Bitcoin made possible a secure, decentralized, open-source financial network. Users wouldn’t have to trust an agency or authority, just the software.

So true and so beautiful. This is exactly what Bitcoin is about : a breakthrough the likes of which hasn’t been seen since that joo from Nazareth burst forth from the divine cunt to wash his friends’ feet. And can you believe our good fortune that we’re alive to see it ??

Together Bitcoin’s miners amount to hundreds of times more computing power than the combined output of the world’s top 500 supercomputers. Processing and protecting the more than $3 billion worth of bitcoins in circulation requires more than $100 million in electricity each year, generating a volume of carbon emissions to match.

And not a moment too soon, came those power-devouring ASICs.v A year or more later and state-level actors would’ve had the resources to crush it, or at least put up a bit more of a fight. Now it’s beyond them all – be it China, Russia, or the US – just as Niagara Falls is beyond a single fallen tree to stop.

All that computing power, which could be curing cancer or exploring the stars, is locked up in machines that do nothing but process Bitcoin-type transactions.

Machines that “do nothing” but disrupt everything and anything you can wrap your noodle around seem to me like a pretty reasonable use of computing power. Curing cancer and star-gazing are not only infinitely less important, but the former is a money-trough for feeding post-doc cows and the latter is a hobby, so how can these really compare ?

The prospects for democracy in the system have grown dimmer still. [...] A distributed network of users now has to trust an oligarchy of capital-intensive miners.

Yes, as Bitcoin matures, the weak hands are definitely caving to the strong hands, but also, the whole fucking point of Bitcoin is that the users don’t have to trust the miners.

That’s what it means when we say that Bitcoin is “censorship-resistant.” The users have the power, those in the WoT even more so. The miners are merely acting in their own self-interest, they could care less whose transactions they’re relaying, they just want to get paid. We’re merely here to ensure that this remains so.

“Some of the New York Bitcoin Center guys are pretty religious,” says Tim Swanson. [...] Swanson has grown increasingly skeptical that Bitcoin will unsettle the existing finance megaliths.

Swanson would be skeptical of Bitcoin, especially after I hung him up to dry for being a derp.

“Being your own bank sounds cool in theory,” Swanson says, “but it’s a pain in reality.”

Ok, Swanson has a point here. This is precisely why Bitcoin will never be about mass adoption. The barriers to entry for even appreciating a sliver of its potential impact, combined with the technical savviness needed to not get raped using it, are as high as the walls of Babylon.

Bitcoin, in any case, is only the beginning.

Not only is there no Bitcoin 2.0, Bitcoin doesn’t even need such a thing.

Last June I went to the Bitcoin Center to hear a speech by Vitalik Buterin, a 20-year-old Russian-Canadian tech-prodigy. [...] With a World Cup game projected silently above him, Buterin presented an update on his new project, Ethereum, a platform that proposes to take what Bitcoin does for money and do it for just about everything else.

Sure, except that Ethereum is a fucking scam. Hey Vitalik, where’s your magic pixie dust that’s going to revolutionise all the things in all the places ? We’re still waiting !

“Distributed technologies do not necessarily lead to distributed outcomes,” writes Michel Bauwens, the Belgian-born founder of the P2P Foundation, which Satoshi Nakamoto turned to early on to promote his vision. Bauwens points out that the Bitcoin economy is more unequal than the conventional one. Currently, the top 100 users hold at least 20 percent of the wealth.

One could argue that a dentist’s drill is a “distributed technology” as they’re available online for a few hundred bucks, and yet, you don’t drill your own teeth ! Now why is that ? Is it perhaps because you don’t have the skills, training, knowledge, and ability to handle it safely ?

If it is, that sounds a lot like Bitcoin : a dangerous offering that you’d be well advised to steer clear from unless you’re, shall we say, adventurous. Y’know, like Giovanni Caboto.

Entrusting our money to algorithms, it turns out, is no guarantee of a better result than managing it with flawed institutions and flawed people. Perhaps we should be imagining tools that help us trust each other more, rather than entrusting ourselves to a rush for digital gold. The technology at work in Bitcoin can do this. It can be rearranged for cooperation rather than competition, for reputation rather than anonymity, for democracy rather than oligarchy.

Bitcoin is arranged for reputation. That’s sorta exactly what the WoT is all about and why it’s so important. Now that we’ve removed physicality from business and removed physical recourse from contracts, all we have to go on is reputation. This makes Bitcoin in the WoT quite cooperative while the pretenders outside eat each other like crabs in a bucket, mostly to great lulz.

The allure of the machines makes it easy to forget that what we need is not a newer, slicker system but a better society.

Isn’t that exactly what we’re doing ?? Oh, that’s right, it is !! Nathan and I just happen to disagree about what “better” means. Nathan says it means more free shit for everyone, that is, more of the same. Bitcoin says it means death to consumerist retardation. I think I’ll side with Bitcoin here…

One recent evening at the Bitcoin Center, a middle-aged woman with a pearl necklace visible beneath her trenchcoat approached a shaggy-haired staffer standing next to the miners. She was from Harlem; the only name she cared to give was “Miss E.”

“What is this Bitcoin?” she asked the staffer, who embarked on a long explanation of Bitcoin as a “layer” on the Internet for finance and of the cryptographic mechanics that kept secure. He was far from done when Miss E started to look like she was ready to leave.

“I thought I would come in here and find someone who was gonna replace these banks,” she said, gesturing out the window to Broad Street. “We need to distribute the wealth, you know what I’m saying? I thought this was something for the small people.”

You wanting and you needing are different things, you know what I’m saying ?

Bitcoin is what you need, so it’s exactly what you’re getting.

If that makes it “unfair,” well, too bad, so sad.

___ ___ ___

  1. Schneider appears to be of the opinion that journalism and reporting are about talking to people who want to talk to him, not people he wants to talk to. Nathan, and any other “journalists” out there, for future reference, the people who matter in Bitcoin are on IRC. []
  2. Though it’s not necessary to be first, being a fast follower appears to yield the best rewards. Certainly this is the case in Bitcoin, where the 2009-2010 cohort is dead and gone, and the 2011-2012 cohort is running the show. []
  3. From Eric Naggum (cached) :

    It is a truism that “that which does not kill you makes you stronger”, but the summary of evolution and natural selection is all wrong: It is not “survival of the fittest”, a phrasing that has prevented billions of people from grasping the mechanism, it is “death of the unfit”, by which is, of course, meant that which failed to deal with a particular accident, which means that those individuals or groups that had less surplus than was required to stay alive long enough to recover after an accident had wiped some of them or their stored resources out, strengthen the group and the survivability of all fit individuals by dying. Therefore, each individual is not only morally obliged to overproduce if it wants to stay alive, it is morally obliged to underconsume, i.e., not consume all that it can. []

  4. On the differences between fiat and Bitcoin, this pretty much says it all :

    One of the best examples of inflation being transparent is the percentile system, such as Bitcoin enforces. So, if one day I own 1% of all the goods in the world, and the next day I only own 0.5% of all the goods in the world, my position has factually erroded, and this means there was an inflation of goods in the world. This is the subtle meaning of owning say one thousand Bitcoins : you know that come Hell or high water, you will still own 1/20`000 of everything that there is. No matter what happens, you’ve got your 0.005% stake of everything. Of everything. If today that means you own five women out of ten billion people and tomorrow they manage to find better ways to pack the species up like sardines and the population jumps to 100 bn, that means your own harem headcount will also jump to 50. Just so, and just by itself – you won’t have to do anything whatsoever. Just sit there and it just comes to you, by virtue of you being the modern equivalent of an aristocrat, and all new good things that happen have to be given to you in proportion to your aristocracy. Jus Primae Noctis is no joke, it’s a policy as far as Bitcoin goes.

    Now conversely, in a fiat system, where there’s no fixed relation between the mass of money and the world itself, having any sum of money simply means you have to keep running, or else you’re getting erroded by those still willing to run. And even if you do keep running, you’ll still be erroded, by all those running faster – or, what’s worse, by all those running smarter. For instance if you’re the sort of idiot that runs the hard track of trying to get value out of reality you’re in for a sore beating at the hands of those who know the most productive sort of running is running to mommy government to bitch and whine. So mommy prints money, diluting your ownership of the world, to give it to these guys that are apparently smarter than you, because instead of beating reality into submission they coddle and compliment mommy to orgasm.

    Obviously the first system has the disadvantage that it encourages serenity (you know what Pascal said) and ossifies society, whereas the second has the disadvantage that it encourages activity. Or pollution. Either make the atmosphere unbreathable, to be frank. In any case, it’s all about progress, which is to say the constant degradation of the quality of life on the wharf by constant import of filthy, unworthy louts that have to also be fed and clothed and given yachts. So wouldn’t you make do with a small rowboat instead, this way a hundred thousand more idiots you never met and never would care to meet can also have their own boats, and be cool just like you ? We’ll issue you yacht certificates for your boats, of course, so nobody can say you don’t own a yacht anymore. We’ll even make it illegal for anyone to laugh at how stupid you are. Deal ?

    via The basics of banking. A discussion. pe Trilema. []

  5. Bitcoin isn’t “unsustainable” despite the bemoaning of envirotards. Bitcoin is very sustainable and will grow up until it consumes 50.1% of the world’s electrical power resources. []

19 thoughts on “Bitcoin is unfair. That’s the point and so it shall remain.

  1. cazalla says:

    You will not be shocked to read that the Bitcoin Center NY is now getting into the business of incubating startups.

    http://bitcoinist.net/bitcoin-center-nyc-launches-startup-incubator/

  2. fred gott says:

    Bitcoin is a fiat currency. it is backed by nothing but promises that it is worth something. Having a mathematical definition with limits on currency volumes, creating artificial scarcity, does nothing to give it value.

    The ever increasing barriers to entry of mining will drive the bitcoin world to a monopoly and the equivalent of a centralized bank.

    As far as I am concerned, bitcoin is a modern version of “free banking” with all the accompanying scams, bank collapses, misplaced trust and criminal activity.

    • wyrdmantis says:

      “Bitcoin is a fiat currency”

      No. It is not.
      It is backed by TIME.

    • As far as I am concerned,

      This says it all, doesn’t it ? I mean really, on what fucking planet do you come from that you think your opinion on the matter is of any import whatsoever any more than the opinion of a seagull matters to the design of the Space Shuttle Colombia. You are in no position to make such criticisms or claims. You’re demonstrably non-existent as far as conversations of Bitcoin, finance, and economics go.

      And I second wyrdmantis’ comment and further add that scarcity is more important than you give it credit for. This is, as much as anything, what differentiates a Rolls Royce from a Honda; what differentiates art from scrap. Scarcity is the solution.

  3. Mitchell says:

    Lol, BP killin’ the game. I need your face on a t-shirt. Keep the goods coming, I reference it like cray!

  4. Chris Evans says:

    Bitcoin is fair and actually much more fair then the current banking system.
    There are many options to check and verify it but the best maybe is to see the growing demand and number of daily transactions. We see the same in the bitcoin gambling guide industry – more players, more brands, more opportunities and much more interest.

    Chris
    Bitcoingg.com

    • In some ways Bitcoin is more fair than the current banking industry, in the sense that the currency itself can’t be arbitrarily inflated for the sake of political gain and that it can’t be coercively taxed. On the other hand, Bitcoin is less fair in the sense that it’s technically and philosophically beyond the reach of pretty well everyone. But as they say, c’est la vie.

      Either way, Chris, can you explain why your derpy little website doesn’t have the biggest gambling venue in Bitcoin, BitBet.us ?

  5. […] retards thinking that Bitcoin revolves around their braindamage, or derps thinking that their failures aren’t their faults, just to take two examples. […]

  6. […] bank account that won’t let you withdraw $20k in cash at a moments notice ? Not progress. My bitcoin ? […]

  7. […] our feet to the verdant fields and miresome muck below, and our sky-high barriers to entry. How very unfair, wouldn’t you say […]

  8. […] like Bitcoin is unfair, that’s the point, and so it shall remain. Couldn’t […]

  9. […] Soviet Union, but we see it more broadly in anything that isn’t “fair” (including Bitcoin). And while I’ll be the first in line to rail against the inhumanities of centralised […]

  10. […] that’s been eroded and squandered at the alter of gender non-specificity and its attendant unfairnesses and inequalities. Someways down this necrotic, despondent and hopeless path is the “trigger […]

  11. Eddy says:

    Bitcoin is fair and actually much more fair then the current banking system.
    There are many options to check and verify it but the best maybe is to see the growing demand and number of daily transactions. We see the same in the bitcoin gambling guide industry – more players, more brands, more opportunities and much more interest.

    Greetings,

    • The current “banking” system is but a symptom, no more nor less representative of modern socialist ills than the current “allegation of sexual harassment is proof” system, or what have you. Those seriously looking for alternatives tend to start with Bitcoin if they’re seriously looking at all. The rest follows whether it’s because it’s more fair, more sane, or just boring old Gresham’s Law and its necessary consequences.

  12. […] non-tenured lecturer in political economy at the University of Sydney. He clearly didn’t read Nathan Schneider in The New Republic in 2015 or else he wouldn’t have rehashed so much of the same fallacious […]

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