The Essence of Bitcoin
Bitcoin’s essence is that it is a good idea, for the good of humanity, whose time has come, and which cannot be stopped.
If you were to ask the question “What is man?” you might get a joking reply like “mostly water.” Such an answer wouldn’t be incorrect, but it would hardly be useful. It wouldn’t even tell you the difference between a man and a watermelon, or a cup of tea, both of which are also mostly water.
To be useful, you would need to go deeper and ask the question “What is the essence of man?” That’s a discussion that has been ongoing for thousands of years. I’ve personally thought about and discussed this topic a great deal, 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. However, I also 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.
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To explore the essences of some of the concepts we’ll be discussing, I’m going to rely heavily on using hyphenation followed by the word “like”. For example, if I said something is “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 does 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. (If you do happen to be interested in a piece about how Bitcoin is life-like, please read “Hello, I am Bitcoin”)
Since we’ve already mentioned “life-like,” let’s talk about something life-like. A company is life-like. It is founded (born), operates (lives), grows, adapts, and learns. It may give birth to other companies and 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 a process that consumes resources and produces something. It eventually comes to a demise — a death-like event. A company even has “organ-like” departments, each 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 reveals another entity, the economy, which we could describe as “ecosystem-like.”
As companies are to living things, an economy is to a 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 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 it 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 dwell in both the ecosystem of living organisms and within the economy. Those are the two realms we try to survive and thrive within. We store and expend actual energy in the ecosystem, and we store and spend monetary energy in the economy.
We humans straddle an existence in both realms — the ecological realm and the economic realm. In the ecological realm real energy is energy. In the economic realm, money is energy-like.
But money isn’t exactly like energy. Money is just an agreement to exchange actual energy. A pile of money doesn’t do any work itself. 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.
Money isn’t actual energy. It is an offering from one participant in the economy to another to trade energy for that money. This is where the economy differs from the ecological realm. Participants don’t typically offer anything as a trade in the ecological realm. 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 provide nothing in return. Ecology operates on “The law of the jungle.”
The economic realm exists apart from the ecological realm, and it does so entirely and only because of money!
Money is the invention that makes it practical to say, “Instead of taking without giving, I will trade something I have for something you have.”
Since barter doesn’t even work on small scales, it is only money that allows this realm of trade — the law of the economy — to exist.
Every magnificent man-made thing we see around us is possible only because we invented money and found a way to work cooperatively through trade instead of operating as the 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 in the traditional sense of life. They don’t have to kill and eat others to grow, thrive, and survive. They instead have to find other 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 which 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, we do not accept. Instead, we trade. We trade our product for money — or vice versa.
This, then, 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 scale, we need money. Money is something one gets that one can then use to trade with another person.
Thanks to money, humans don’t need to take from each other by force because they can trade.
Thanks to trade, also known as transactions, made possible 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 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 to survive. In the wilderness, you are expected to fight for your life or get killed by something else.
In the economic realm, we deal with fairness and justice. We are expected to use our energy to produce something of value to others and to fairly trade it with them for something they have used their energy to produce, which we value. Taking without giving back something fair in return is considered injustice.
Nearly every element of our moral code comes from avoiding the law of the jungle and usually replacing it with the law of the economy!
Don’t kill — reject the law of the jungle.
Don’t steal — obey the law of the economy.
Don’t initiate the use of force against others — reject 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 we have actual laws against).
The above don’ts of our moral code make up the logic of the laws we pass to enforce our morality.
The “dos” of our moral code, below, 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. (That’s the law of the economy)
Do act peacefully towards others. (That’s also the law of the economy)
Do tell the truth: about what you are capable of, what your product is, and the integrity of your money. (Be honest in trade within the economy)
Whether you’re religious or not, this moral code is the one that the vast majority of humans believe in. Even wicked humans who regularly kill, lie, steal and cheat don’t deny it — they just try to find ways to work around it or rationalize breaking it.
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 involves 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 murder without money — and if you just look at history, you’ll see that when money collapses, much murder ensues.
Thus, human morality at any significant scale — that of trading instead of taking — is impossible without money!
So when we hear the refrain that “money is the root of all evil” or that the “love” of it is, we should be prepared to counter with “No. Money is needed so we can eliminate the need to do evil.”
This finally brings us to our friend, Bitcoin. Well, almost.
Some people don’t act morally. The law of the economy is not a necessity of nature. It is that you do work and trade your work for the creation of others, using money. Since it asks rather than commands, it can be disobeyed, and some people disobey it. We’re not talking about people who steal something and run away with what they took. We’re talking about those who try to distort humanity’s morality. This code says that trading work for work is fair, reasonable, and moral. These are people who want to take from others without giving anything in return and attempt to justify doing this even though it is unjust.
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, which 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 by force — 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 give some of what they take to people who they say require what they took by force. They do not talk much about trade.
They implement this immoral code through the mechanisms of politics and by altering the laws of our civilization — laws that were supposed to enforce morality but which they rewrite 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 and its share of the total income.
This distortion of morality ultimately manifests through distorting the idea of fairness. What was deemed fair before this distortion took place was voluntary exchanges between people, usually with one side exchanging money — a ‘fair’ trade.
Instead, economists and politicians now talk about everyone having to surrender their “fair” share, and they call this justice. Anyone not surrendering their fair share violates some new law, and there’s at least one huge agency that will ensure you’re caught, prosecuted, have that fair share seized by force, are made to pay a fine, and perhaps even be thrown in prison, your freedom taken away by force. That is the 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 easier to deceive inexperienced people about what is and isn’t moral.
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 itself. 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.
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 of money and goods by force is Theft and is immoral, and I am enforcing the economic law of ‘don’t steal’ through the inviolable laws of math.”
It adds, “Theft through inflation is immoral, and I am also enforcing the economic law of ‘don’t steal’ through a supply cap through the inviolable laws 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 through the mathematically provable performance of work (proof of work).”
It says, “Lying is immoral, and every statement in my records will be mathematically provable to be true through the branch of math known as cryptographic signatures.”
Finally, it concludes, “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 does not listen to economists’ claims that “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 joining the higher-paid ranks of the immoral class. Bitcoin does not listen to central bankers who mislead us about who their policies enrich and what they are actually up to.
So these people are all freaking out.
Bitcoin enforces genuine morality, true fairness, and authentic justice through math while saying 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 Bitcoin by publishing papers saying it is immoral because it doesn’t let them exercise their power, and so on. They may bring forth corrupted ‘experts, ’ ‘scientists, ’ celebrities, and whoever or 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 asks that we not lie, steal, or kill. The true laws of the universe are those of mathematics and physics, and Bitcoin is enacted and enforced using those laws.
This is the essence of Bitcoin that this article is meant to reveal: 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 (and at least sometimes) honest politicians, ran on a platform that said, “There’s enough money when no one steals.” He said that honestly. He effectively said, “Let’s obey the law of the economy, not steal.”
It led him straight to Bitcoin.
Bitcoin doesn’t need politicians to support it. However, because it is an unstoppable moral force, it will lead to the end 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. They are parasites, and they have become too numerous 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 has overplayed its 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 distinguishes humans from other living things and is our basis for human morality.
It is Bitcoin that lets us peacefully unwind this doomed, runaway economic immorality without suffering complete economic collapse.
How quickly Bitcoin replaces the corrupted, immoral financial system with a truly moral system is uncertain. It may happen very quickly — largely because of the fact that in acting with increasing desperation to save their collapsing system, the immoral class is actually accelerating its demise, thus making room for Bitcoin to become adopted more quickly.
There are many variables at play. However, what is not a variable is 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.
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. We must:
run a Bitcoin node
convert our fiat money to Bitcoin
accept and spend Bitcoin
learn how to use the Lightning Network
be moral by obeying the laws of the economy
not let ourselves be intimidated
not let ourselves be fooled
not be a part of restoring morality to our civilization.
If, unfortunately, you find yourself 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 significant turning point in history in favor of the good. Bitcoin’s essence is that it is a good idea for the good of humanity, whose time has come, and which cannot be stopped.
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Tomer Strolight is Editor-in-Chief at Swan Bitcoin. He completed bachelors and masters degrees at Toronto’s Schulich School of Business. Tomer spent 25 years operating businesses in digital media and private equity before turning his attention full time to Bitcoin. Tomer wrote the book “Why Bitcoin?” a collection of 27 short articles each explaining a different facet of this revolutionary new monetary system. Tomer also wrote and narrated the short film “Bitcoin Is Generational Wealth”. He has appeared on many Bitcoin podcasts including What Bitcoin Did, The Stephan Livera Podcast, Bitcoin Rapid Fire, Twice Bitten, the Bitcoin Matrix and many more.
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