Bitcoin is the object of endless discussion. This conversation is important.
So let’s continue:
Bitcoin is a disruptive technology from an economic standpoint and a powerful instrument for leveraging the possibilities of its underlying technologies for the purpose of creating a highly competitive parallel economy that could oppose the traditional form of centralized monetary governance.
As such, the asset is becoming a weapon in the hands of not only various financial and other activists, but is also taking on the shape of a proverbial “Philosopher’s Stone”.
The discussions around Bitcoin and the possibilities it has are quite diverse and, at times, controversial, frequently elevating to the level of hysteria and even paranoia, as was seen many times in the US Senate during hearings on the status of the crypto industry. This very status of a wedge between warring camps of adherents and opponents of centralization is fueling the reputation of Bitcoin among a growing number of those who have been disenchanted with the traditional form of governance prevailing across the world’s financial and economic structure.
However, the many hopes and responsibilities that are being imposed on Bitcoin, and some other leading cryptocurrencies masking behind its prominence, are tethered to a rather false perception of the asset as a be-all and end-all. Bitcoin is not the Philosopher’s Stone, and neither is it a solution to all the world’s problems. It is a decentralized currency capable of yielding financial and potentially social benefit, but not an omnipotent weapon that would dethrone existing governments and authorities and usher in an age of anarchist peace.
In stark contrast to the hopes and dreams of complete decentralization’s adepts and zealous proponents, the goal of Bitcoin is not to bring about financial anarchy and unrestrained freedom, nor is it gold or money made “out of thin air”.
Bitcoin is an instrument, a financial one, that obeys the laws of supply and demand just like any other commodity traded on the market alongside it. And just like any other form of sound money, Bitcoin is bound to expenses that are incurred in the process of its production, meaning that those who believe it to be a magic godsend aimed at toppling over the regimes of central banks and financial flow monitoring are gravely mistaken. As Bitcoin adoption unfolds, we should expect regulation, attempts at containment but ultimately – when central banks do get involved – integration.
If examples of mistaken analogies of Bitcoin’s perception are to be taken, the philosophy of French thinker Michael Foucault can be used as a counterweight to a more pragmatic superposition by Noam Chomsky. While economist John Quiggin called BTC “the most demonstrably valueless financial asset ever created” back in 2013, Foucault would have opposed such a claim if he had the chance to examine the characteristics of the decentralized economy and its mainstay assets. Such a diehard opponent of all things centralized and controlled would have brazenly raised the banner of Bitcoin as a laudable technology for his purposes. But he might have been wrong, as Noam Chomsky would have comcluded after having called Foucault “totally amoral”.
True, the Frenchman’s exaggerated views on governance and human nature as such may be outliers in the real world and in oversight of where it is now and where it is headed, but at the same time it is impossible to deny the influence Bitcoin is having on human perception of its current existence and stage of evolution.
The centralized system of governance has been restricting freedoms, while Bitcoin is providing a degree of liberty in the financial and in some cases political realm, where most human interactions take place. But Bitcoin is not a liberator, nor is it a savior, if it is not carried and treated with the right mindset. Bitcoin might shake foundations, but it is not there to destroy human civilisation as we know it. Rather, it might grow to form one among many foundational pillars of this ever-advancing civilization..
While advocating decentralization, Bitcoin stands for its own decentralization, not the dismantling of existing centralized systems. Instead, Satoshi Nakamoto’s White Paper should be read from a more long-term perspective, not the perverted vision of quick profiteering that his creation has been devolved to by greed and tunnel vision price-chasing.
Bitcoin has the potential of reducing decentralization overall only when it can start putting up competition not only to traditional financial systems, but to itself as an instrument in both form and purpose. Broader freedoms and improvements in global interactions between people outside the market can only take place when the most secure blockchain in the world is seen as something more than just a profit-making network.