Bitcoin could change the remittance industry as we know it, revolutionize banking and redistribute economic power to the under-privileged. It could also transform the current global political hierarchy.
The author begins her essay by addressing the concerns of skeptics who claim that Bitcoin is in the hands of a tiny elite, which could eventually replace the bankers of the present financial system. One of the solutions that have been suggested is to provide everyone living on earth with an equitable amount of coins, something that due to time and financial constraints is not practical.
Bitcoin enables a concept called decentralized organizing. Until recently this is a concept that was mostly confined to books on libertarianism and anarchy. However, the idea has been given new life through recent movements such as the Occupy movement, which spread in cities around the world.
An important achievement of the “swarm effect” is that it has created a new form of volunteerism. In the old model, volunteers were associated with charities and gave of their time and resources. In the new model of volunteerism in the Bitcoin environment, one does not need any permission to offer his/her skills. This new model has contributed to the great amount of innovation which centers around four pillars, customers, merchants, miners and developers who are constantly developing new tools in the Bitcoin ecosystem.
This approach has allowed the growth of an expanded network of companies and individuals who are constantly looking for new ways to make Bitcoin use much more widespread around the world. In the view of Nozomi Hayase, the biggest challenge remains in the mind. As a result of what she describes as “corporate colonization,” the world’s citizens are now limited by their ability to imagine doing anything different from what they are used to. She gives the example of the First Nations, which were able to think in tandem with the earth, unlike the modern economy that has cut off humanity from the earth.
In the modern world, populations are confined within the borders of nation-states. In these nation-states, governments determine currency and monetary policy. These governments create levers of control that prevent people from becoming individuals with complete agency in their right. Instead, it creates a chain of command in which those at the top employ the use of coercive power to make people work against their interests.
The key goal in such a system is compliance, and a secondary goal becomes the accumulation of money. These goals in turn lead to the use of money to acquire power, and also to foster corruption. Such a system inevitably leads to the emergence of a tiny minority who control the levers of power, and hence the access to and the flow of wealth to the rest of the world. Nozomi Hayase explains that this system is now responsible for the enormous debt that threatens to turn the globe into servitude. According to her, Bitcoin has the ability to challenge that growing status quo.
She also believes that the new digital currency has the power to challenge the nature of sovereignty itself. The current model is based on control, domination and the plunder of natural resources. The blockchain promises to change that through mutually shared ideals and voluntary association. It could, therefore, trigger changes in global governance as well, including shrinking the gap between the North and South, dissolve the American empire and wean the world off dependence on the oil economy. It could also potentially end war if the nations of the world put their minds to it.
There is no doubt in my mind that Bitcoin is truly revolutionary, or to use the world that has become the flavor of the year, “disruptive.” Nozomi Hayase argues very powerfully for Bitcoin and its potential for change. In my view, however, she over-estimates the power of Bitcoin to solve the problems of the world, and here is why.
In the first paragraph, she highlights the trouble some quarters have with the early adopters of Bitcoin who cumulatively now control most of the coins in circulation. Time and time again, the history of man’s sojourn on the earth is littered with examples of causes that started off with noble intentions but ultimately became captive to the darker dungeons of humanity.
As I was doing the research for this article, I came across the story of Lise Meitner. Lise Meitner was an Austrian physicist who worked on radioactivity and nuclear physics. She was one of the scientists who discovered nuclear fission. Little did she know that her work would lead to the development of the atomic bomb that brought death and destruction to Hiroshima and Nagasaki. As Nozomi Hayase so ably argues, it is nearly impossible to manipulate the Bitcoin blockchain. Nevertheless, a search for Bitcoin scandals and scams on the Internet will reveal that it has become a huge global problem.
Secondly, it is safe to say that Bitcoin is still in its early phases. Typically the early phases of any human endeavor are characterized by such things as egalitarianism, innovation and shared sacrifice. As companies or projects grow bigger, it often becomes difficult to retain those features. Instead ivory towers and an unhealthy focus on the bottom-line often becomes the overriding concern.
Bitcoin may not have much to fear on that score right now, but how about after the last coin is mined? Will human nature have sufficiently evolved so as to ensure retention of the qualities that originally brought us to the dance? There is no denying that Bitcoin is here to stay. However as it grows there will be a need to protect what will perhaps be the greatest invention of the 21st century from the greed inherent in human nature.
Images from Rick Falkvinge and Shutterstock.
Last modified: September 30, 2014 10:29 UTC