The implications of Bitcoin for inheritance.

Not marble, nor the gilded monuments
Of princes, shall outlive this powerful rhyme;
But you shall shine more bright in these contents
Than unswept stone, besmear’d with sluttish time.
~William S.

Anyone with the blessing of wealth and the burden of childreni has surely given the issue some thought. Who to give it to, and who not to, and when exactly ?ii

These considerations have a fruitful and evocative history. From locked-out second sons conquering the New World to Haakon IV taking up his grandfather’s mantle to Charles IV and the Golden Bull, political intrigue has been the mainstay of inheritance contests. When territories required armies to protect and vassals to maintain them, these machinations were as inevitable as they were blood-soaked. But given that bitcoin can be transmitted between any two parties regardless of geographical or soi-disant “legal” constraints,iii the limitations on transference once imposed by Kings upon their subjects lest said subjects accumulate enough wealth to threaten His priviledged position go out the window like so many red vegetables on a calorific summer’s day in Buñol.

One might imagine that the primary political implication of this would be an increased rate in turnover at the top of the Bitcoin hierarchy given the opportunity for multiples nodes of power to coalesce independently and thence compete, but at least two factors suggest that this extrapolation is incomplete. The first is that the barriers to entry in creating multiple nodes within The Republic (thus far the only possible sovereign), are significant. The exceedingly humble rate of growth in the Republic’s ranks at present would indicate that the critical mass needed to exceed the Dunbar number or even a significant proportion thereof is a fantastically distant prospect. The second is that creating a competing Republic de novo is akin to making a competitor for electricityiv – including the two hundred year infrastructural disadvantage. Not that we should ever underestimate the power of human ingenuity, but sticks and stones will break a lot of bones before they ever light a creative spark to compete with Franklin’s, much less build-out the supporting network. Then again the Chinese black box is… a black box.

Regardless, the result for well-heeled Bitcoiners is that there are no more rules :

  • You can tell each of your kids that they’re winning the lion’s share of your amassed fortunes and it’s trivial to persuade each of them that this is exactly so.
  • You can publicly announce that one of your children is the preferred while making backroom deals to favour another.
  • You can bequeath your estate to someone on the other side of the world, someone you’ve never met in person.
  • You can choose to be buried with your private keys still locked inside your worm-infested skull, implicitly increasing the value every other bitcoin extant.

And more! These outcomes are all possible in a way never before imaginable with physical property. And while subdivision of larger units down to the last satoshi is still a concern, it’s hardly pressing for the deceased, and is it even for pioneers to build castles ? Aren’t log cabins and a clearing enough ?

So that’s it. We already knew that Bitcoin was disrupting everything, literally, but it never hurts to flesh out a few of the more intriguing edge cases, besmear’d as we will all ultimately be with sluttish time. Inheritance is just one more rhyme.

___ ___ ___

  1. I say “burden” somewhat tongue-in-cheekly. They’re generally a wonderful burden to have, like any burden that surprises, delights, and carries on your lineage in the world to come. []
  2. Premature disposition of your estate could have tax benefits (see Zuckerberg, Buffett) but it could also be undesirable for the same reasoning that prematuring in other domains is undesirable (ie. the party hadn’t even started yet and you’ve already cum and gone). Leave the decision too late, however, and you may find that you’re no longer as sharp as you once were, leaving your loved ones to wage war against one another without your esteemed guidance to parry their blows. []
  3. Consider also that there can be no more court battles to decide the distribution of inheritance. If the deceased entrusts his wealth to his lawyer to distribute upon his death (though this isn’t advisable – it’s nothing for the lawyer to walk with the stash) then said representative is free to distribute without recourse. Bitcoin transactions are irreversible, after all, and no court on the planet has jurisdiction over Bitcoin, nor could it.  []
  4. What would this even look like ? Recall that before your sports car had magnetorheological dampers because gizmos are cheap, it had hydropneumatic suspension systems because engineering was a thing.   []

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