Is the Bitcoin a good idea for Catholics and Evangelical Christians
Here is a summary of The Bitcoin Standard by Saifedean Ammous
The book starts with the history of money. Durable money has the characteristics of being salable over:
- Time (Doesn't devalue)
- Location (easy to transport)
- Scale (Can be divided for small or big payments)
He provides historical examples of successful and unsuccessful money.
Any item used as currency (shells, stones, cigarettes, fiat currency, etc.) that is easily produced, mined or printed can be devalued. Gold was a success because it was almost impossible to replicate, was hard to mine, fairly small, and rare, etc..
Without being a prepper, he accurately predicted our current situation 5 years ago. Fiat currency always leads towards government debt, devaluation of currency, inflation, government tyranny, compromised educational institutions, concentration of power, big government, bad art (because it is funded by bureaucrats, not market forces), surveillance, constant war (because the nation can print money to feed the military industrial complex and incur debt to keep fighting even if its loosing, and the public doesn't realize the full cost). Bad ideas are invested in by self interested governments, all this is at the expense of the population it governs.
The Gold standard from 1871-19xx was the "Belle Epoque" because currencies were backed with gold, rather than dept. He listed the inventions during that time, explaining that going from 0 items of a new invention to 1 is way more important than going from 1 to many (scaling and improving existing inventions). He argued that the inventions of the "Belle Epoque" were more significant than those since the gold standard was abandoned. For instance, the automobile, airplane, telegraph, telephone, even the computer, etc. whereas after the gold standard most inventions were just improvements on these seminal inventions.
Time preference is the ratio that a population values the present vs the future - saving vs spending. With a sound currency, individuals, corporation and government value saving over spending (future time preference) and they fare better for a variety of reasons, than those that spend in the present. Inflation causes people, institutions and Governments to spend more in the short term and save less.
The was even a bit of a prolife message pg 137
"The more humans exist on earth, the more technologies and productive ideas are thought of, and the more humans can benefit from these ideas and copy them from one another, leading to higher productivity of human time and improving standards of living."
In the digital realm the important currency quality of scarcity was pretty well impossible before Bitcoin, because when we send something it is just a copy of the original.
Why is bitcoin unique?
- salable over time, location and scale
- Expensive to make new coins
- no "trusted third party" is necessary because it 100% validation 0% trust.
- Relationship of miners, coders, users creates a tension that assures stability
- Blockchain is uniquely useful for Bitcoin because the distribution makes it hard to tamper with and anyone wanting to fork it can't get agreement from enough stakeholders who have competing goals. Any significant change will benefit some at the expense of others, so it's stable.
- Other crypto or bitcopies will have a governing body, who often become rich, and who become defacto "trusted" 3rd party to the people doing the transactions. They are being trusted to not roll back the code, which they can do if they think they have a good reason. (i.e, Ethereum)
- The main value of blockchain technology is turn electricity used by many miners into trust. Other uses of it are pretty inefficient ... governments that use it are expending tons of energy over a distributed network... but they are a "trusted 3rd party" which makes that use of energy over a distributed network unnecessary and wasteful.
- Its weaknesses are its strengths. It cannot be used efficiently for micro payments and day to day payments. Its more like Gold. Expensive infrequent, slow, transactions (1-10 minutes), allows for "trusted 3rd party" software to grow up around it to facilitate micro payments which combine transactions off-network before posting to the network.
- 1MB maximum facilitates ability to run the network over any type of connection, which increases nodes and worldwide adoption even in areas with bad internet, or in a social collapse scenario.
Here are some favourite quotes from the book:
“Government control of money has turned money from being the reward for producing value to the reward for obedience to government officials. It is impractical for anyone to develop wealth in government money without government acceptance. Government can confiscate money from the banking monopolies it controls, inflate the currency to devalue holders' wealth and reward it to the most loyal of its subjects, impose draconian taxes and punish those who avoid them, and even confiscate bills.”
“The bitcoin blockchain has placed a 1-megabyte limit on the size of each block, which has limited the pace at which the blockchain has grown. That limit allows simple computers to be able to maintain and run a node. Should the size of each block increase, or should the blockchain be used for more sophisticated processes such as those touted by blockchain enthusiasts, it would become too large to be run on individual computers. Centralizing the network over a few large nodes owned and operated only by large institutions defeats the entire point of decentralization.”
“The question of whether bitcoin wastes electricity is at its heart a misunderstanding of the fundamentally subjective nature of value. Electricity is generated worldwide in large quantities to satisfy the needs of consumers. The only judgment about whether this electricity has gone to waste or not lies with the consumer who pays for it. People who are willing to pay the cost of the operation of the bitcoin network for their transactions are effectively financing this electricity consumption, which means the electricity is being produced to satisfy consumer needs and has not been wasted. Functionally speaking, PoW is the only method humans have invented for creating digital hard money. If people find that worth paying for, the electricity has not been wasted.”
"Ingenious ideas are rare, and only a small minority of people can come up with them. Larger populations will thus produce more technologies and ideas than smaller populations, and because the benefit accrues to everyone, it is better to live in a world with a larger population. The more humans exist on earth, the more technologies and productive ideas are thought of, and the more humans can benefit from these ideas and copy them from one another, leading to higher productivity of human time and improving standards of living.”
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- Part 3: Richard Rohr on social and moral issues
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