More than Software or MoneyMore than Software or Money

Bitcoin is more than just software. This is because it produces a commodity - bitcoins - which its users generate, store, and trade, thereby making that commodity money-like. (Indeed, Bitcoin was invented for this very purpose).

But Bitcoin is more than just a software-generated commodity money. This is because the properties of that commodity align with, protect, and permit the expression of certain philosophical and political beliefs. They include (entirely) voluntary participation, (unrestricted) freedom of speech, (inviolable) property rights, separation of state and economy, and other compatible views.

More than a Political MovementMore than a Political Movement

Bitcoin is, thus, a political movement as much as it is a form of money, because it’s not just any money, it’s money that is just – at least according to the philosophy of those who embrace it for those politically ideological reasons.

It can be said that those who do so, have voluntarily opted into “Bitcoin citizenship”. Now, I need to be careful about how I apply the concept of citizenship here because it almost looks like the opposite. Citizenship is traditionally defined as having legal (i.e. state approved) status approved by a government in which “the individual owes allegiance and in return is entitled to protection”. But Bitcoin is not a government. That is, it has no physical borders, no (traditional) legislature, no leader, no courts, nor or a registrar to track who is a citizen, and it does not demand any allegiance.

But, like everything else in Bitcoin, seeing how far a metaphor goes can be very helpful. Bitcoin does confer a status on every instance of its software – the title “peer”. It is, architecturally, a “peer-to-peer” system, in which all peers are constrained to the same unambiguous rules (aka its consensus algorithm). So it is a system of equals before its laws (i.e. its rules). And its laws are enforced (also unambiguously and also unequivocally) by its users, not by some entity separate from those individuals known as the State.

In Bitcoin, “state” is not some small group of legally appointed rulers and their institutions. In Bitcoin, state means the latest status of the artefact created by running the software – an artefact referred to as the Bitcoin Blockchain (although some prefer Timechain over Blockchain). Everyone who runs Bitcoin’s software, because of its consensus algorithms, agrees on the state of Bitcoin. As Bitcoin has no formal government, it also therefore doesn’t have people with the formal titles we attribute to governments, such as politicians, bureaucrats, parties, election administrators, agencies, etc..

Moreover, because everyone enforces the rules – algorithmically rather than physically – and because the rules cannot be broken, there is no need for institutions that decide what to do with those who broke the rules (such as police, judges, lawyers, jails, parole officers).

Nevertheless, despite the non-existence of individuals with those roles of protecting citizens, the political ideals expressed in the opening of this article are not only protected, they are perhaps protected to a degree they never have been before, precisely because they do not depend on (fallible) human-run institutions to offer those protections.

Let’s take a quick look at the properties I mentioned in the introduction:

Voluntary Participation: Nobody can be forced to use Bitcoin, nor is anyone, through the mere act of being born (not something a baby volunteers to do) entered into the obligations of allegiance, taxation, debt repayment, etc… Only those who choose to run BItcoin are required to abide by its rules and to receive the protections it offers (including the protection of not being required to use it involuntarily). Yet, anyone, anywhere, at any time can voluntarily join the network and receive its full protections. Even those who committed violations of government legislated laws can participate in Bitcoin. This leads to the often mistaken logical leap that “bitcoin is for criminals,” but that’s a topic to be discussed elsewhere. Suffice it to say that because of its extreme adherence to the principle of Voluntary Participation, Bitcoin is for anyone.
Freedom of Speech: As an extension of Voluntary Participation, no matter what you say, Bitcoin will not restrict your ability to use it. This is often referred to as censorship resistance. I don’t need to say any more because it’s that simple.

Inviolable Property Rights: There is no state or hostile actor that can seize your bitcoins by bureaucratic or physical force applied to the system. Only access to your private, secret keys can move your bitcoins. How is ownership defined in government-enforced legal system? There are government run registries (like the land and automobile registries), regulated custodians of property (such as banks), contracts (subject to court interpretation), and physical possession (subject to who can retain that physical possession in a battle over some piece of property). But in Bitcoin, ownership is much simpler, as evidenced in one of the more popular cultural memes – “Not Your Keys, Not Your Coins”. Removing the negatives from that meme we get “If you have the keys, you own the coins.”

Separation of Economy and State: As far as the Bitcoin software is concerned, those with keys own the property associated with those keys and can do whatever they want with those keys and the associated property. The notions of taxation, regulation, permitted uses of funds, etc… are not aspects built into, nor able to be grafted onto, Bitcoin. Of course, participants may voluntarily pay taxes, adhere to regulations, and obey government laws in how they utilize their bitcoins, but the system itself does not make such demands.

So Bitcoin does offer protections to its “citizens” – protections which those who voluntarily choose to be citizens find valuable enough to be worth the effort of becoming citizens (which basically amounts to running bitcoin software, securing secret private keys, and obtaining bitcoins).

Digital CitizenshipDigital Citizenship

For people living in places and times where the protections offered by Bitcoin are seen as valuable, becoming a Bitcoin citizen is a choice open to nearly anyone. (I say nearly because some may not have the resources to run the full software themselves.)

Electing to opt in to Bitcoin’s protections is not a repudiation of the State in which one already resides or of the protections it offers and allegiances it demands. But Bitcoin’s protections are borderless and timeless and these benefits travel with Bitcoin's citizens to wherever they go (whenever they go there).

In this sense Bitcoin can be seen both as a state within a State - a sub-state, and simultaneously as a state outside of the State - a super-state. As a sub-state it is a provider of additional protections beyond those offered by a State (and in some cases protection from violations of rights by the State). As a super-state it is a set of protections provided beyond the consideration of any agreed upon (or disputed) national borders.

A Network StateA Network State

As a voluntary, global, Stateless option available to all people and providing valuable protections, it is perfectly reasonable to expect the number of people who opt in favor of Bitcoin’s protections to grow. As this happens the value of its money-like commodity increases according to network dynamics (Metcalfe's law, power laws, Pareto principles, etc…).

Unsurprisingly, even those people who don’t value its protections or share the political ideologies which Bitcoin is aligned with, will take note of its exchange value (aka its monetary premium) and become interested in participating in that growth. And here is where Bitcoin begins to mix in with the rest of the political apparatus which is full of fallible (and failing) individuals and institutions.

Bitcoin can’t be ignored by the State, but it also can’t be changed by the State, so the State must accept Bitcoin as it is and adapt itself to the fact that Bitcoin is both a sub-state and a super-state. We are bound to see a lot of experimentation, failure, recalculation, etc… as different States try different things and as Bitcoin citizens react differently to these different things. Some actions might draw more people within a State to opt into Bitcoin citizenship. Curiously both actions that embrace Bitcoin and outlaw it seem to have the effect of increasing its use within a State. Some actions might draw people from outside a State’s borders to visit or even immigrate. Some will have the opposite effects. Some actions will be much-ado-about-nothings – merely political announcements that amount to nothing more than being announcements.

Novelty and Uniqueness Make Prediction DifficultNovelty and Uniqueness Make Prediction Difficult

Exactly how, and how quickly, the integration of Bitcoin into the world’s political and economic frameworks plays out is an incredibly hard task.Bitcoin is entirely unprecedented. We’ve never had anything that operates without human leadership, that provides these protections in this way. Like other wide-impact, unpredictable technologies, we must accept that precise predictability is not possible. Some handy rules of thumb, however, do exist.

Evaluating the choice to become a Bitcoin citizen is highly advisable, and if one finds Bitcoin’s protections valuable, taking the actions to learn how to obtain them is logical. Evaluating the morality of Bitcoin’s ideological protections is also advisable – as there will be many more people enjoying these protections regardless of whether one finds them desirable or not.

For those who have already evaluated Bitcoin and opted to become Bitcoin citizens, you may want to accelerate the growth of the network state. However, doing so in any manner that violates Bitcoin’s principles is going to, at best, provide only short lived advances that are likely to lead to greater setbacks. For example, badgering or even forcing the unwilling into Bitcoin, which they will eventually voluntarily opt out of (because Bitcoin is purely voluntary) is a net zero at best, but often comes with a cost of lost friendships, respect, reputation, etc….

Be skeptical of predictions that claim high degrees of precision. Recognize that it’s better to be approximately right than precisely wrong. Be skeptical of recommendations and schemes that bypass you running the software and holding private keys – the promises of convenience and superior returns come with the hidden cost of not benefitting from any of Bitcoin’s protections at all. Now, if you don’t want those protections that’s fine, but don’t come crying to Bitcoin citizens when your rights are violated and these alternatives did not protect you; and don’t mistake people pushing for these alternatives as Bitcoin citizens either.

Your ChoiceYour Choice

You can decide any time to opt in, or to later opt out. However, times change. The longer you wait to evaluate Bitcoin the longer you live without its benefits and protections. To quote the lyrics of the song “Free Will” by Rush, “If you choose not to decide you still have made a choice!”

If you can’t be bothered to evaluate Bitcoin you are ignoring a historic advancement not just in software, not just in money, but also in the exercise of individual political power. And to quote the ancient Greek politician Pericles “Just because you don’t take an interest in politics, doesn’t mean politics won’t take an interest in you.”