"A vast network structure, at the centre of which lies three sets of issuers issuing out three chained layers of legal IOUs – in physical and digital form – which will later return to the issuers to be destroyed, but which in the interim entrench themselves as economic network access tokens that circulate around an interdependent web of people who cannot mobilise each other’s labour without them. These tokens are activated in the context of legal systems set within political systems set within social systems set within ecological systems, and this mesh structure underpins modern capitalism and is etched into the very fabric of our being."
Thanks for another excellent article, Brett! One that nicely builds upon previous articles you wrote.
In terms of education, I think that your thesis about the structure of money deserves a place in (economics?) books, as the functions of money theory are not insightful, they are hiding more than they reveal. Thank you for enlightening.
There's no concept as "conceptual" as money, is there?
A very interesting and thought-provoking article. I have a feeling that your article could be summed up by "bitcoin has no intrinsic value" - or am I misunderstanding it?
I also think that your description of bitcoin as a token misses out on the greater perspective of the system as an effective network for transferring value. This network, greatly emphasized by the fast-growing Lightning Network, has tremendous potential and will probably redefine how we move money around.
I agree that the narrative of Bitcoin is somehow trapped in the same ontological mess of money in general while presenting it as an antithesis of our current monetary system.
Hi Svein, the point of the article is that while Bitcoin might mimick the surface appearance of the normal monetary system, in the sense that it appears as numbers on a screen, it's numbers are fundamentally different to those found in your bank account. In this sense it is not 'stuck in the same ontological mess of money in general' - the article explicitly points out that numbers in the banking system, for example, are not mere numbers - they are issued out to ordinary people as *liabilities* of a bank, whereas BTC tokens are not issued out to anyone - they are written into existence as *assets* of whoever happens to update the ledger, and those assets are, well, mere numbers written out after energy is expended.
In this sense, if you were to metaphorically imagine the two systems as people, the normal monetary system is far more 'self-assured' in who it is, whereas the Bitcoin system is constantly posturing and insecure in itself. They really are not even in the same class of system.
Finally, you can say something like 'the Bitcoin system is an effective network for transferring value', but what you really mean is 'the system is an effective network for transferring numerical nouns (colloquially called tokens) with a monetary price around'. This means the BTC system is owned by the fiat system, in that its tokens don't have any power at all unless they first get a monetary price in, say, dollars
Hi Sikander, that would certainly be one approach to combat the circularity of the tokens. I.e. if the ledger has some use beyond the movement of the tokens, then the tokens could get 'anchored' to that. Right now the ledger is simply used to record the movement of tokens, which in itself can never account for why the tokens should be seen as useful, but if the ledger could be used to record other things - with some external utlity in the world - then the system could develop more coherence
I don’t understand why a unit of account needs to have any intrinsic properties. Surely anything can function as a unit of account if enough people agree to treat it as such? It’s that agreement rather than the thing itself that creates the unit of account, surely?
The idea that money is some kind of agreement is problematic in itself, but ask yourself how you would get people to agree to use a limited edition numerical noun as a unit of account. A pure number - like those you find in Bitcoin - does not promise access to anything, and it also has no physical form. You can imagine people being able to conceptualise using gold as a common measure, purely because gold has properties beyond its numbers (the numbers are just weight of substance), but in Bitcoin, by contrast, the numbers refer to nothing beyond themselves, which means they have a very poor basis upon which to begin being a unit of account. Aka. you're asking someone to equate useful objects created with real labour with abstract numbers somehow (and numbers that are not legal liabilities like they are with state and bank fiat money)
I don't think the article was stating that a unit of account needs any intrinsic properties, as much as that the unit of account was the critical property distinguishing a currency from other types of assets.
Unit of account is a social relationship - you only need to be a member of a defined social group in order to take part in the currency. A country is a useful social group for this because money is often used in contracts and countries tend to create legal systems to enforce those contracts.
The great part of this is that you don't "have to join", you are automatically part of the social group when you enter the social space (e.g., country).
Can anything function as a unit of account if enough people people agree to treat is as such? Certainly you can have a private unit of account (PUOC) and as long as your members agree to be held to PUOC then you are good to go. But you can't impose that PUOC on people outside your group.
So as a private unit of account, it is limited to members who voluntarily decide to accept it - and I assume could easily decide not to accept it at some point.
Excellent post. You're doing a good job building on your previous work and linking it all together.
I do have a couple of issues though:
First, when you say Bitcoin "points too nothing" I think that's not quite true (although it is very close). Bitcoins are the only object that can be used to pay for Bitcoin block space natively through the Bitcoin network. Now you might rightfully ask "why would I want to buy block space?" which can be answered with "well, you can use it to create Bitcoin transactions: which can send Bitcoin or store small amounts arbitrary data across all of the nodes in the Bitcoin network". Now they might not find that particularly valuable, but its not nothing.
Secondly, I'm surprised you talk so much about countertrading without talking about why someone might want to countertrade with Bitcoin (or any permissionless cryptocurrency). The answer mostly being that it routes around the global KYC/AML regime. I think you're absolutely right that BTC itself doesn't threaten the USD regime, but it does threaten the global KYC/AML regime (despite the relatively weak privacy protections of BTC, it's radically stronger then giving everything up on a silver platter). If you want to route around that regime, you need to access the rails of the Bitcoin (or again, any permissionless crypto) network; and, as I mentioned above, the only way to access these rails is to use BTC.
Of course, the BTC collectable is reasonably good at countertrade, but it isn't the best medium of exchange if all you want to do is route around the regime. What you really want is a dollar that rides the crypto rails. Hence, Tether's popularity despite it's fraudulent nature.
Yes I've had others arguing that the ability to pay transaction fees for Bitcoin transactions in bitcoin creates a kind of 'redeemability' to the units. I sort of see the argument, but it still feels very circular to me: It's a bit like saying 'a small amount of an object needs to be handed in before other instances of that same object can be moved'. It still provides no account of what the object is. The circularity emerges from the fact that the same class of thing forms both the 'fees' and the thing being moved (imagine making a statement like 'we value US dollars because we have to pay US dollar fees when we are moving US dollars around')
I have countertraded with Bitcoin, so I have a decent feel for its use in that realm. Note though, that I'm not disparaging about its use for countertrade. It's not an 'insult' to Bitcoin to say it has high countertradability. Yes, this feature is very interesting, and it has the ability to scramble the surface data flows of monetary systems. High countertradability could even be revolutionary.
But yes, as you mention, stablecoins are far better at docking into the pricing vortex that is the US dollar, so are potentially far more powerful than mere limited edition numerical nouns
Oh, I wasn't suggesting that saying 'Bitcoin is good for countertrade' was insulting (although, given how thin-skinned the crypto space can be, I can understand your defensiveness). I just was finding it odd that you never seem to mention it, since I think it's a big part of why BTC exists the way it currently does. I agree that most of what major Bitcoin proponents say is revolutionary about BTC most certainly isn't.
I also agree that "you need Bitcoin to pay for fees to move Bitcoin" is a very circular argument, although I think this is more a limit to what the Bitcoin network can actually do and how it is marketed than a flaw in Bitcoin itself. If you imaging a Bitcoin like system consisting of a Bitcoin-like token, a stablecoin, and a technical reason why the stablecoin couldn't pay fees directly, I think you have a real answer too 'what is this token, really'.
That's not the narrative coin promoters want to sell, because it's an intrinsically limited narrative. So I agree that the inner essence of the token undermines the savior narrative the promotors want it to have. Which is the underlying contradiction a lot of the space is built on.
For sure. Certainly I used to write more (like eight years ago!) about why Bitcoin was useful for countertrade and the particular features and use cases it has, but nowadays many in the crypto space seem to believe that accurately characterising it as a countertradeable collectible is tantamount to denying that it has a use (I know that you're not such a person, but I do get attacked a lot by the crypto-bro brigade)
A friend of mine (Will Ruddick) has been making a similar argument about the fact that a token required to activate a useful ledger has redeemability for that use case. The main circularity in Bitcoin is that the primary 'use case' of those tokens which are used to pay fees is to make the same class of tokens move. If there was some separate use that the ledger had, the circularity could be overcome (I haven't phrased this particularly well, but I hope you get the point)
Ah, that makes sense. I probably should go back and read your earlier work.
I find it humorous and frustrating that I can't agree with either the proponents nor detractors of the crypto space. Most of the time, I end up hoping BTC is a good enough distraction while others (like myself) try and work on hashing out a better system.
I'll take a look at Will Ruddick as well. A cursory glance seems like he does interesting work on some good causes. Thanks for the tip.
My guess is this article will age poorly. Money and state will separate within 50 years and Bitcoin adoption will continue to grow faster and faster. 1 billion users by 2025
You will note that this article does not say 'Bitcoin adoption will not continue to grow'. I explicitly say that it will undoubtedly grow. The piece is exploring what the inner essence of these objects are supposed to be, which is something you will have to grapple with if you actually wish to come up with an account of why Bitcoin will one day cease to be a countertrade object dependent upon dollar pricing
There *will* be at least one central bank issued stablecoin.
China has had a central bank issued stablecoin - the e-RMB - for some time now. It is domestic only use but over $5B in transactions, which compares very favorably with literally all non-criminal, non-investment, non-mining bitcoin "spend". Even more so if the early "15 bitcoins for a pizza" transactions are thrown out.
I have yet to see any credible path by which any moderate or larger sized nation's monetary authorities will permit the dilution of their regulatory, fiscal and sovereign control over their money supply will be permitted by crypto as currency.
China is the only one with a legitimate rationale to issue a mass stablecoin: they need to lock their domestic savings in even while opening up the RMB for external use; I don't see any other way by which the USD as reserve currency gets replaced.
Reading the comments it seems most people don't understand what the definition of money being a legal contract is all about, I don't know what part of coercive network they don't get
I see another way to relate it to NFTs. Instead of having a separate hash on the chain for each NFT of the same media file, Bitcoin has a hash for a bundle of NFTs (Satoshis) of the Bitcoin Core protocol on the Bitcoin network. Instead of a person disassociating their key from an NFT to associate it with someone else's key, on the Bitcoin network a person can disassociate their key from some bundles of NFTs (Satoshis) and create associations between other people's keys and some new bundles of NFTs, as long as the total of the numbers out is less than the total of the numbers in. Satoshis are NFTs for the Bitcoin Core protocol, but instead of being managed individually, they are managed in bundles (utxo's).
Or is your point that the ineffable value of those things is good and meaningful and the ineffable value of other things, which while the exact same concept, has a different level of "this is what I value" that makes it such that your argument is unchallengeable.
The article already did it for dollars and pounds (maybe you should read the whole piece again to see this). As the article explains, dollars and pounds are issued out as *liabilities* to the issuer, and take the form of numerical adjectives, whilst Bitcoin tokens are numerical nouns that are created as *assets* of a miner. Those are fundamentally different concepts
You have a lot of good analogies which get your point across. However you do go in circles a lot and could use a good editor. Please get an editor and you could be the preeminent thought leader in the Bitcoin space.
I disagree, predominantly because of the following analogy:
"You cannot ‘price’ British pounds in Bentley cars or Tetley’s Tea any more than you can claim a tornado is being ‘sucked in’ by the pieces of debris flying around it."
Anyone with a math background can tell you that this is silly. The conceptualization of pricing GBP in fractional Bentleys is not only valid, but equivalent to the conceptualization of pricing Bentleys in GBP. Nobody does this because taking apart a Bentley is going to change its value in a nontrivial way. This isn't true of bitcoin, which makes it a bad analogy.
The funny thing is, we agree on his final point. Bitcoin can be anything to anybody. Its lack of definition is one of its greatest strengths. One person may use bitcoin as a savings account, another may use it to buy VPN services, another may buy it to speculate, and there's always going to be that weird guy who makes an art project out of it. Bitcoin's lack of an attached description allows it to be anything you want. I guess that's distressing to some people. To others, its a wide open field of opportunity.
Monetary systems are not abstract mathematical systems, and there is nothing about being a mathematician that gives anyone any unique ability to understand them. Rather, monetary systems are political systems, and they have structural power.
The best metaphor to understand this is think of the common phrase - 'the sun rises' - which is untrue, because it is the earth that turns around while the sun, in relative terms, is static. While we understand someone who says 'the sun rises', in real terms they are massively overestating the power that the earth has in relation to the sun. The structural power lies with the sun, not the earth. Similarly, a mathematician might say to me 'you can represent pounds in Bentley's', but in doing so they are massively overstating the power of Bentley's in relation to the actual monetary system, which is a vast coercive network structure far more fundamental to a market economy than a mere Bentley car is, and far more powerful than any individual object within the network
In terms of your last point, it's fine to say Bitcoin's open-endedness (or - more accurately - deliberate vagueness) can give rise to creativity, but you also need to accept that it has also created mass confusion and delusion too. My final paragraph was not necessarily a positive endorsement of Bitcoin's vagueness
It's a nice metaphor, but I don not feel it is particular accurate or useful. It sort of echoes the 'money is a badge' belief - the belief that money is like a badge given out to you in recognition of some deed done, and which 'represents' work done, which I find unconvincing
Your definition of “chair” seems to rule out meta chairs, folding chairs, chairs in dollhouses, etc. Is there any way of fixing this definition that doesn’t ultimately rely on a functional approach?
I noted that it was a rough definition of a particular type of chair. I did not say it covered every possible variation of a chair. Language has porous boundaries, so no, there is no way to have a final defintion of a chair - in ordinary language, however, we find it easy to make these distinctions between things that merely share a common function, and things that seem to be 'the same as each other'. This is why most people have very little trouble in seeing a three-legged stool and an armchair as being closer to each other than either is to a yoga ball
Just to reiterate why I was writing about structures. I was not trying to say there is a final definition of a chair - I was illustrating how 'disassociated' functions (functions stripped of a structural accompaniment) can be easily abused
I finally got around to reading this awesome post, and typed up a long reply, which turned out to be too long to post here. So I posted it on my blog instead: https://ebuchman.github.io/posts/filling-the-hole-in-bitcoins-heart/
Cheers!
Thanks Ethan - will get to this as soon as possible
This is excellent :
"A vast network structure, at the centre of which lies three sets of issuers issuing out three chained layers of legal IOUs – in physical and digital form – which will later return to the issuers to be destroyed, but which in the interim entrench themselves as economic network access tokens that circulate around an interdependent web of people who cannot mobilise each other’s labour without them. These tokens are activated in the context of legal systems set within political systems set within social systems set within ecological systems, and this mesh structure underpins modern capitalism and is etched into the very fabric of our being."
- thank you!
Glad you like it!
Thanks for another excellent article, Brett! One that nicely builds upon previous articles you wrote.
In terms of education, I think that your thesis about the structure of money deserves a place in (economics?) books, as the functions of money theory are not insightful, they are hiding more than they reveal. Thank you for enlightening.
There's no concept as "conceptual" as money, is there?
Glad you like it Mark!
I read your article, and I must say that's post was a large part of my curiosity about Bitcoin and thats economical mechanism.
Bitcoin, like capitalism, provides us a large screen of ambiguity and lies and censorship.
Thank you for your wonderful post
A very interesting and thought-provoking article. I have a feeling that your article could be summed up by "bitcoin has no intrinsic value" - or am I misunderstanding it?
I also think that your description of bitcoin as a token misses out on the greater perspective of the system as an effective network for transferring value. This network, greatly emphasized by the fast-growing Lightning Network, has tremendous potential and will probably redefine how we move money around.
I agree that the narrative of Bitcoin is somehow trapped in the same ontological mess of money in general while presenting it as an antithesis of our current monetary system.
However, the question in the end is: so what?
Hi Svein, the point of the article is that while Bitcoin might mimick the surface appearance of the normal monetary system, in the sense that it appears as numbers on a screen, it's numbers are fundamentally different to those found in your bank account. In this sense it is not 'stuck in the same ontological mess of money in general' - the article explicitly points out that numbers in the banking system, for example, are not mere numbers - they are issued out to ordinary people as *liabilities* of a bank, whereas BTC tokens are not issued out to anyone - they are written into existence as *assets* of whoever happens to update the ledger, and those assets are, well, mere numbers written out after energy is expended.
In this sense, if you were to metaphorically imagine the two systems as people, the normal monetary system is far more 'self-assured' in who it is, whereas the Bitcoin system is constantly posturing and insecure in itself. They really are not even in the same class of system.
Finally, you can say something like 'the Bitcoin system is an effective network for transferring value', but what you really mean is 'the system is an effective network for transferring numerical nouns (colloquially called tokens) with a monetary price around'. This means the BTC system is owned by the fiat system, in that its tokens don't have any power at all unless they first get a monetary price in, say, dollars
Very interesting!
I’m curious, what do you think of Bitcoins possible utility beyond the token?
Say for example as a basis for futarchy or distributed dns?
Hi Sikander, that would certainly be one approach to combat the circularity of the tokens. I.e. if the ledger has some use beyond the movement of the tokens, then the tokens could get 'anchored' to that. Right now the ledger is simply used to record the movement of tokens, which in itself can never account for why the tokens should be seen as useful, but if the ledger could be used to record other things - with some external utlity in the world - then the system could develop more coherence
Yes. I agree.
Drivechain is a project that tries to bring extensability to bitcoin through a 2-way-peg and blind merge mining.
Have you ever looked into it?
Hey Sikander - I haven't yet. So many projects to look into!
Yeah I get it.
It’s not live yet so no hurry. I think you will like it though, and maybe also the bitcoin hivemind project that are connected to it.
I don’t understand why a unit of account needs to have any intrinsic properties. Surely anything can function as a unit of account if enough people agree to treat it as such? It’s that agreement rather than the thing itself that creates the unit of account, surely?
The idea that money is some kind of agreement is problematic in itself, but ask yourself how you would get people to agree to use a limited edition numerical noun as a unit of account. A pure number - like those you find in Bitcoin - does not promise access to anything, and it also has no physical form. You can imagine people being able to conceptualise using gold as a common measure, purely because gold has properties beyond its numbers (the numbers are just weight of substance), but in Bitcoin, by contrast, the numbers refer to nothing beyond themselves, which means they have a very poor basis upon which to begin being a unit of account. Aka. you're asking someone to equate useful objects created with real labour with abstract numbers somehow (and numbers that are not legal liabilities like they are with state and bank fiat money)
I don't think the article was stating that a unit of account needs any intrinsic properties, as much as that the unit of account was the critical property distinguishing a currency from other types of assets.
Unit of account is a social relationship - you only need to be a member of a defined social group in order to take part in the currency. A country is a useful social group for this because money is often used in contracts and countries tend to create legal systems to enforce those contracts.
The great part of this is that you don't "have to join", you are automatically part of the social group when you enter the social space (e.g., country).
Can anything function as a unit of account if enough people people agree to treat is as such? Certainly you can have a private unit of account (PUOC) and as long as your members agree to be held to PUOC then you are good to go. But you can't impose that PUOC on people outside your group.
So as a private unit of account, it is limited to members who voluntarily decide to accept it - and I assume could easily decide not to accept it at some point.
Thanks for the comments - also see the response I added above for Ben
Excellent post. You're doing a good job building on your previous work and linking it all together.
I do have a couple of issues though:
First, when you say Bitcoin "points too nothing" I think that's not quite true (although it is very close). Bitcoins are the only object that can be used to pay for Bitcoin block space natively through the Bitcoin network. Now you might rightfully ask "why would I want to buy block space?" which can be answered with "well, you can use it to create Bitcoin transactions: which can send Bitcoin or store small amounts arbitrary data across all of the nodes in the Bitcoin network". Now they might not find that particularly valuable, but its not nothing.
Secondly, I'm surprised you talk so much about countertrading without talking about why someone might want to countertrade with Bitcoin (or any permissionless cryptocurrency). The answer mostly being that it routes around the global KYC/AML regime. I think you're absolutely right that BTC itself doesn't threaten the USD regime, but it does threaten the global KYC/AML regime (despite the relatively weak privacy protections of BTC, it's radically stronger then giving everything up on a silver platter). If you want to route around that regime, you need to access the rails of the Bitcoin (or again, any permissionless crypto) network; and, as I mentioned above, the only way to access these rails is to use BTC.
Of course, the BTC collectable is reasonably good at countertrade, but it isn't the best medium of exchange if all you want to do is route around the regime. What you really want is a dollar that rides the crypto rails. Hence, Tether's popularity despite it's fraudulent nature.
Yes I've had others arguing that the ability to pay transaction fees for Bitcoin transactions in bitcoin creates a kind of 'redeemability' to the units. I sort of see the argument, but it still feels very circular to me: It's a bit like saying 'a small amount of an object needs to be handed in before other instances of that same object can be moved'. It still provides no account of what the object is. The circularity emerges from the fact that the same class of thing forms both the 'fees' and the thing being moved (imagine making a statement like 'we value US dollars because we have to pay US dollar fees when we are moving US dollars around')
I have countertraded with Bitcoin, so I have a decent feel for its use in that realm. Note though, that I'm not disparaging about its use for countertrade. It's not an 'insult' to Bitcoin to say it has high countertradability. Yes, this feature is very interesting, and it has the ability to scramble the surface data flows of monetary systems. High countertradability could even be revolutionary.
But yes, as you mention, stablecoins are far better at docking into the pricing vortex that is the US dollar, so are potentially far more powerful than mere limited edition numerical nouns
Oh, I wasn't suggesting that saying 'Bitcoin is good for countertrade' was insulting (although, given how thin-skinned the crypto space can be, I can understand your defensiveness). I just was finding it odd that you never seem to mention it, since I think it's a big part of why BTC exists the way it currently does. I agree that most of what major Bitcoin proponents say is revolutionary about BTC most certainly isn't.
I also agree that "you need Bitcoin to pay for fees to move Bitcoin" is a very circular argument, although I think this is more a limit to what the Bitcoin network can actually do and how it is marketed than a flaw in Bitcoin itself. If you imaging a Bitcoin like system consisting of a Bitcoin-like token, a stablecoin, and a technical reason why the stablecoin couldn't pay fees directly, I think you have a real answer too 'what is this token, really'.
That's not the narrative coin promoters want to sell, because it's an intrinsically limited narrative. So I agree that the inner essence of the token undermines the savior narrative the promotors want it to have. Which is the underlying contradiction a lot of the space is built on.
For sure. Certainly I used to write more (like eight years ago!) about why Bitcoin was useful for countertrade and the particular features and use cases it has, but nowadays many in the crypto space seem to believe that accurately characterising it as a countertradeable collectible is tantamount to denying that it has a use (I know that you're not such a person, but I do get attacked a lot by the crypto-bro brigade)
A friend of mine (Will Ruddick) has been making a similar argument about the fact that a token required to activate a useful ledger has redeemability for that use case. The main circularity in Bitcoin is that the primary 'use case' of those tokens which are used to pay fees is to make the same class of tokens move. If there was some separate use that the ledger had, the circularity could be overcome (I haven't phrased this particularly well, but I hope you get the point)
Ah, that makes sense. I probably should go back and read your earlier work.
I find it humorous and frustrating that I can't agree with either the proponents nor detractors of the crypto space. Most of the time, I end up hoping BTC is a good enough distraction while others (like myself) try and work on hashing out a better system.
I'll take a look at Will Ruddick as well. A cursory glance seems like he does interesting work on some good causes. Thanks for the tip.
My guess is this article will age poorly. Money and state will separate within 50 years and Bitcoin adoption will continue to grow faster and faster. 1 billion users by 2025
You will note that this article does not say 'Bitcoin adoption will not continue to grow'. I explicitly say that it will undoubtedly grow. The piece is exploring what the inner essence of these objects are supposed to be, which is something you will have to grapple with if you actually wish to come up with an account of why Bitcoin will one day cease to be a countertrade object dependent upon dollar pricing
My guess is exactly the opposite.
There *will* be at least one central bank issued stablecoin.
China has had a central bank issued stablecoin - the e-RMB - for some time now. It is domestic only use but over $5B in transactions, which compares very favorably with literally all non-criminal, non-investment, non-mining bitcoin "spend". Even more so if the early "15 bitcoins for a pizza" transactions are thrown out.
I have yet to see any credible path by which any moderate or larger sized nation's monetary authorities will permit the dilution of their regulatory, fiscal and sovereign control over their money supply will be permitted by crypto as currency.
China is the only one with a legitimate rationale to issue a mass stablecoin: they need to lock their domestic savings in even while opening up the RMB for external use; I don't see any other way by which the USD as reserve currency gets replaced.
Reading the comments it seems most people don't understand what the definition of money being a legal contract is all about, I don't know what part of coercive network they don't get
Excellent article, thank you. I like to know your perspective in Ethereum as a protocol, and the price attached to it Ether .
I see another way to relate it to NFTs. Instead of having a separate hash on the chain for each NFT of the same media file, Bitcoin has a hash for a bundle of NFTs (Satoshis) of the Bitcoin Core protocol on the Bitcoin network. Instead of a person disassociating their key from an NFT to associate it with someone else's key, on the Bitcoin network a person can disassociate their key from some bundles of NFTs (Satoshis) and create associations between other people's keys and some new bundles of NFTs, as long as the total of the numbers out is less than the total of the numbers in. Satoshis are NFTs for the Bitcoin Core protocol, but instead of being managed individually, they are managed in bundles (utxo's).
Now do it for dollars and pounds.
Or is your point that the ineffable value of those things is good and meaningful and the ineffable value of other things, which while the exact same concept, has a different level of "this is what I value" that makes it such that your argument is unchallengeable.
The article already did it for dollars and pounds (maybe you should read the whole piece again to see this). As the article explains, dollars and pounds are issued out as *liabilities* to the issuer, and take the form of numerical adjectives, whilst Bitcoin tokens are numerical nouns that are created as *assets* of a miner. Those are fundamentally different concepts
You have a lot of good analogies which get your point across. However you do go in circles a lot and could use a good editor. Please get an editor and you could be the preeminent thought leader in the Bitcoin space.
Thanks for the feedback
I disagree, predominantly because of the following analogy:
"You cannot ‘price’ British pounds in Bentley cars or Tetley’s Tea any more than you can claim a tornado is being ‘sucked in’ by the pieces of debris flying around it."
Anyone with a math background can tell you that this is silly. The conceptualization of pricing GBP in fractional Bentleys is not only valid, but equivalent to the conceptualization of pricing Bentleys in GBP. Nobody does this because taking apart a Bentley is going to change its value in a nontrivial way. This isn't true of bitcoin, which makes it a bad analogy.
The funny thing is, we agree on his final point. Bitcoin can be anything to anybody. Its lack of definition is one of its greatest strengths. One person may use bitcoin as a savings account, another may use it to buy VPN services, another may buy it to speculate, and there's always going to be that weird guy who makes an art project out of it. Bitcoin's lack of an attached description allows it to be anything you want. I guess that's distressing to some people. To others, its a wide open field of opportunity.
Monetary systems are not abstract mathematical systems, and there is nothing about being a mathematician that gives anyone any unique ability to understand them. Rather, monetary systems are political systems, and they have structural power.
The best metaphor to understand this is think of the common phrase - 'the sun rises' - which is untrue, because it is the earth that turns around while the sun, in relative terms, is static. While we understand someone who says 'the sun rises', in real terms they are massively overestating the power that the earth has in relation to the sun. The structural power lies with the sun, not the earth. Similarly, a mathematician might say to me 'you can represent pounds in Bentley's', but in doing so they are massively overstating the power of Bentley's in relation to the actual monetary system, which is a vast coercive network structure far more fundamental to a market economy than a mere Bentley car is, and far more powerful than any individual object within the network
In terms of your last point, it's fine to say Bitcoin's open-endedness (or - more accurately - deliberate vagueness) can give rise to creativity, but you also need to accept that it has also created mass confusion and delusion too. My final paragraph was not necessarily a positive endorsement of Bitcoin's vagueness
I had completely forgotten i wrote this. Please take a look: https://pastebin.com/J5natikr
James Buchan's definition of money is the best: money is frozen desire.
It's a nice metaphor, but I don not feel it is particular accurate or useful. It sort of echoes the 'money is a badge' belief - the belief that money is like a badge given out to you in recognition of some deed done, and which 'represents' work done, which I find unconvincing
Albeit, having said that, I haven't actually read the piece where he writes this, so I may be misinterpreting
It's not a piece. It's a book.
Your definition of “chair” seems to rule out meta chairs, folding chairs, chairs in dollhouses, etc. Is there any way of fixing this definition that doesn’t ultimately rely on a functional approach?
I noted that it was a rough definition of a particular type of chair. I did not say it covered every possible variation of a chair. Language has porous boundaries, so no, there is no way to have a final defintion of a chair - in ordinary language, however, we find it easy to make these distinctions between things that merely share a common function, and things that seem to be 'the same as each other'. This is why most people have very little trouble in seeing a three-legged stool and an armchair as being closer to each other than either is to a yoga ball
Just to reiterate why I was writing about structures. I was not trying to say there is a final definition of a chair - I was illustrating how 'disassociated' functions (functions stripped of a structural accompaniment) can be easily abused