The Times 03/Jan/2008 Chancellor on brink of second bailout for banks1
—Anonymous
This text was embedded in the coinbase of the first block ever mined by the founder of Bitcoin.
It serves as a historical reference and time stamp, but also a mission statement.
This infamous quote has no one to claim it, because the founder of this technology has intentionally remained anonymous, despite many attempts to locate or guess their identity.
This anonymity, however, is central to the success of the technology. It is incorruptible, unable to be influenced, bought, or sold. Its code is open source, it is truly a decentralized form of both communication and finance.
It’s possible you might be asking yourself, why the sudden, two-week long fixation on Bitcoin and decentralized finance?
The reason is two fold:
Our goal at TPP is to address complex problems with thoughtfulness, empathy, and compassion
Our study of philosophy informs this goal, and in decentralized finance we see the intersection of the various facets of that goal.
To put it plainly, decentralized finance is a manifestation of generations of dreaming about a version of human organization which is fair, predictable, and incorruptible.
But what do I mean by incorruptible?
In Layered Money Nik Bhatia writes,
The next component of Satoshi’s [the chosen name of the anonymous founder(s) of Bitcoin] elaborate design lies in Bitcoin’s monetary policy, or the rules around the supply of BTC and how it comes into existence.
Not set by human beings in the boardroom of a central bank, Bitcoin’s monetary policy is an algorithm programmed by Satoshi in 2008 to specify its exact issuance schedule into eternity.
The issuance rules were coherent, elegant, and just…
For the first 210,000 blocks (or approximately four years) of Bitcoin’s existence, 50 BTC was awarded to the successful miner of each block. For the next 210,000 blocks, the reward fell to 25 BTC per block.
Each passing 210,000 blocks, the mining reward halves again. Each of these epochs or periods of time to complete each phase of Bitcoin’s issuance schedule (210,000 blocks—or 4 years), show how Bitcoin’s monetary policy is set in stone, not up for debate in the halls and teleconferences of central banks. (pp. 89-90)
Remember, monetary policy is a game, with its own set of rules and expectations that people interact with (to paraphrase Mitch Cantor).
Our current game managed centrally has been strained and on the brink of collapse for a few generations now—as we noted yesterday. The visionaries of their times like Ford and Tesla envisioned Bitcoin before they could have imagined the internet, distributed ledger technology, or even a zoom meeting.
But the sentiment was there.
And in 2008 it became a reality—a new game with a fair, predictable, and an incorruptible set of rules, incapable of change or compromise. In every way, Bitcoin is a game.
A game successful enough to scale to above $40,000,000,000 today. A game designed well enough to be adopted as a national currency in a state rife with failed economic and monetary policy—El Salvador.
In 2018 I spent about a year supporting migrants, refugees, and families experiencing displacement from Guatemala, Honduras, and El Salvador. This region of the world—Guatemala, Honduras, and El Salvador—is colloquially known as the Northern Triangle.
Their stories were always nearly identical. They had experienced a series of displacement events that goes something like this:
Displaced from ancestral homeland by large, foreign corporations supported by foreign governments and their militaries seeking to be the first to exploit the lush, tropical climates for agriculture
Land surrounding new agri-business dies or becomes contaminated by industrial farming practices
Monetary policy to control exports of new agribusiness drives down wages and price for domestic food production—its easier to buy foreign, unhealthy food than what grows on the land and is exported for profit
Extreme, artificial poverty drives groups of people—most of them belonging to a handful of Indigenous communities which have never experienced separation from their lands—to the cities in search for work.
Failed monetary policy has led to the rise of black market paramilitary governments and gangs, which violently exploit these vulnerable people amidst a traumatic, internal displacement event
One or more members of a family flees north in desperation and in the pursuit of safety after one or more of these traumatic encounters.
Something like Bitcoin undercuts such a cycle at stage 2 or 3. And now, BTC it is the monetary policy of El Salvador.
To me, this is the most empathic, human-centric game ever designed. And it’s changing the world. I hear many talk about BTC and it’s background technology (Distributed Ledger Technology) in terms of hype or fad, equating it to a get rich quick scheme.
While this might be the approach or appeal for some, beyond that there is a much deeper potential to accelerate justice, human flourishing, compassion, and empathy.
And tomorrow, we’ll uncover how it might even usher the end of scaled violence and war.
Until then,
Matt
PS, the biggest way that TPP experiences growth is when you share! Would you consider sharing this episode with a friend, on your social media channel of choice, or with someone you think would enjoy it via text? Thank you for being a part of this community!
https://www.newyorker.com/magazine/2011/10/10/the-crypto-currency
Game Theory Vol II