Is Bitcoin True?

One of the earliest reactions people have as they go down the Bitcoin rabbit hole, is the thought,

Bitcoin fixes modern art?!

Bitcoin -- if it is true -- fixes all of the problems of fiat money, even modern art.

The problem of fiat money

Bitcoin was designed to fix the problem of fiat money, which is the problem of politics and money, an incessant problem that has burdened human civilization throughout history.

You may have gotten into Bitcoin as an investment; a high-risk and volatile investment; an investment into the best performing asset of all time. And yet, Bitcoin was not designed to be an investment. Bitcoin was designed to be money, sound money that can fix the problems of fiat money -- it is in this regard that we ask: is Bitcoin true?

The problems of fiat money run deep, beyond the ever-increasing price of meat and potatoes -- shaping Politics and War, Food and Health, Education and Research, Science and Innovation -- and yes, even modern art.

Even modern art?

modern art under fiat

This is an actual piece of art -- that sold.

There are many such examples, along with eye-roll inducing apologetics, such that the banana represents a critique of the very problems of modern art that everyone is criticizing. Janitors protested the banana for pay inequality, another artist ate the banana, and still another wrote "Epstein didn't kill himself" on the wall in red lipstick.

Even the artists and the art dealers know that modern art is vapid nonsense, and so they perform self-referential pieces of art, criticising themselves, being cynical about cynicism -- someone will then call the self-referential cynicism "genius" -- and why stop if the money keeps rolling in?

Rather than ask what is and what is not art, instead ask how art collectors have money for this kind of art, and why they see value in it. And most importantly, find out where that money came from.

Where does money come from?

Money operates as a measure of value, subjective value based on the perceptions of those buying and selling. Money also stores value, value to be used in the future. The time between earning money and spending money is known as "saving".

This simple and subjective sense of value is all that money is and ever will be. It is best understood as a technology, such that good money will be more efficient than bad money. It can be strong money with a fixed supply, or it can be easy money with an inflationary supply.

Inflationary money disprupts the natural cycle of saving, replacing the age old "saving for the future" with consumerism, with credit and debt, with a system of constant spending -- because money that constantly loses value is simply worth more now than it will be in the future.

Worse, fiat money is inflationary at the whims of those who control the money supply. There is a reason janitors have less purchasing power than ever before. And it's not because a wealthy person controlled this outcome. If you are a janitor earning fiat money, you will work harder and harder, but you will earn less and less value over time. And that amount of lost value will be gained by those known as cantilion insiders, those close to the money supply, those who benefit from increases in the money supply, including art collectors.

An art collector's salary will also lose value over time, just like the janitor. However, assets such as real-estate and art will increase in value. Inflating the money supply doesn't just drive up prices of consumer goods, it first inflates the value of hard assets, transfering wealth from those who work and save, to those who own hard assets. And if you dig deep enough, you'll find that most art collectors don't actually earn a salary, have never earned a salary, and that their wealth is not stored in cash.

Political solultions make the problem worse, and over time those controlling the money supply use their ill-gotten gains (known as seigniorage) to control the politics (regardless of the system), so it inevitably becomes a rigged game (be it a democracy or theocracy or socialist dictatorship or otherwise). Revolutions change the faces of the problem, but like the word implies, a revolution is to move in a circle.

There is no political solution.

If you ever wonder why seemingly diverse modern societies are struggling with consumerism, environmental catastrophes, health epidemics where supposedly "wealthy" populations are malnourished and dying younger, and fighting endless wars over control of oil -- look no further than the source of all this misery -- fiat money, where unaccountable bureaucrats control the supply of money at the expense of civilization itself.

While the current round of non-sustainable monetary parasitism began in 1971, this problem is as old as time. Whether it's causal or not can be debated, but societies fall when their money is debased (just ask the Romans). No reasonable person can believe otherwise.

The real question becomes, what can be done about the problem of fiat money?

The terrifying truth

If Bitcoin is true, it is almost too terrifying to contemplate. Bitcoin simply could not succeed in an honest system. It is merely a set of protocols around a cryptographic ledger designed to prevent any and all centralized control of money; it requires voluntary participation; it is designed such that no one can or will control the monetary policy. As a consequence of its design, it is slow and less efficient than what a non-corrupt centralized system could achieve. It is only superior to corrupt dishonest systems (because it fixes the bad-actor problem).

If Bitcoin is true it would mean that the problems of fiat money are not only real but irreconciliable. It would mean our entire system is built on lies, and that our leaders are parasitic sociopaths, selected by broken incentives that benefit short-term gains at the expense of the future, unknowingly destroying civilization in the process.

And it means that we have been participants in this lie.

For Americans it means Nixon was worse than liberals believe, and that FDR was even worse than Nixon. It means our media is corrupt propaganda, and that our political parties are nothing but the coordinators of this propaganda. And none of this is by design but is a consequence of the fiat system itself; of the broken incentives that reward short-term gains at the expense of civilization. Such a system will discourage you from ever discovering,

where does money come from?

This is a lot to take in for even a cynical person. You've been lied to about money, by people who aren't particularly competent, told that money doesn't grow on trees and then to look the other way when money is created from nothing; all by the whims of parasitic sociopaths that know not what they do.

It's tempting to believe the lies, either that they don't exist (it's all just a conspiracy theory) or to believe they exist and are competent enough to actually control money. But the terrifying truth is that they do exist, but are completely incompetent. They don't understand that one cannot actually control money. No one can control money, because money relies on the ever-changing perspectives of value of every person on earth.

Money is technology

Money is the technology that allows for the ever-changing perspectives of value (of every human on earth) to be made known and measurable, that is, to have what are known as prices and markets.

Money requires freedom, freedom to change your mind on a whim, to change your perception of value based on the ever-changing demands in your life.

One cannot control money without controlling the subjective values of every person on earth, controlling not just their thoughts, but their innate sense of value, and all the externalities that might cause them to react, rendering them less than cattle, less than rats, something more akin to cogs in a machine, a machine that is controlled by -- who exactly?

"Bitcoin fixes this"

This oft-repeated quote struck me as too good to be true, the wishful thinking of youthful idealists who are all theory with no real-world experience, those unprepared for the chaotic realpolitik of life.

And yet, if what is claimed about Bitcoin is true, then it could fix the damaging effects of inflationary money. If the supply is truly scarce, now and in the future; and if the network is truly decentralized, such that no system of authority can control or kill it, then yes, logically, Bitcoin could fix many of the problems of fiat money.

But like I said, that all seems too good to be true. Like trying to contemplate what life would be like if people were always honest and forthright; if everyone was kind, humble, and forgiving. People aren't always that way, and it's not helpful to pretend otherwise.

And yet, Bitcoin assumes the opposite, that no one can be trusted.

don't trust, verify

The entire design of Bitcoin is a trustless system that assumes no one is honest. No one. You must verify everything. If there's something we can't verify, then trust is required, in which case we're back to fiat, back to the very problem that Bitcoin is trying to solve.

For Bitcoin to be true, everything must be verifiable.

Why not other Cryptocurrencies?

Altcoins are not attempting to solve the problem Bitcoin solves. They offer no scarcity, and no true decentralization. Most are free market monies that operate as securities. They sometimes offer interesting features because they're digital money, but without scarcity over time.

Most are merely copies of Bitcoin but with a centralized source of control, completely defeating the point, which is why you will hear them referred to as "shitcoins".

Shitcoins cannot solve the problem of fiat money. And they don't try. In all cases they are attempting to become fiat money, granting seigniorage to their own founders. Bitcoin is in a category all its own, a scarce digital resource, a superior money.

If Bitcoin is true, then it wins in the end, outcompeting all other money, potentially redeeming civilization in the process. Anything less than that would prove Bitcoin false.

What if Bitcoin is false?

What if in our journey to verify everything we miss something? And years later we realize that there was a flaw, something we didn't see, but it becomes obvious once exploited.

That's all it would take to prove Bitcoin false -- one small counterexample, a flaw that could not be fixed in a soft fork. If trust was required, then that trust could be exploited -- and those who most effectively violate that trust would become the de-facto controllers of Bitcoin, making it no better than fiat.

What then?

Nothing will have been fixed. The unsustainable problems of fiat would continue in crisis after crisis. However, having learned about Bitcoin you'll understand money. The chaos of the moderm world will make sense. And you'll realize we needed Bitcoin to be true because there was no alternative.

Whether we like it or not, the survival of our civilization depends on overcoming the problem of fiat money. This is the challenge of our generation. The existential threats facing our civilization all point back to fiat money. We cannot solve environmental crises, health crises, meaning crises, or any of the problems in education or politics, not without fixing the broken incentives that created those problems to begin with.

Bitcoin has been referred to as energy money, one of the great filters to the advancement of civilization. This is a polite way of saying that civilization cannot advance when parasitic bureaucrats play God through vain attempts at controlling money. But this also means, for Bitcoin to be true, it must succeed as energy money; it must be the catalyst to advance our civilization.

All Bitcoin would have to do is work. Every day that it works is another day that it has not been proven false. We can dare to hope; we can look for criticisms; or we can support Bitcoin's ascent as a true form of energy money that redeems civilization. The stakes are higher than we can imagine, and what happens next, for better or worse, is up to us.