I’ve been reading The Internet of Money by Andreas Antonopoulos recently.
You can by the book here, it’s based on his lectures from a few years ago now!
Below I’ve selected a few quotes from chapter two which is on Bitcoin in the context of the history of money, and offer a few thoughts...
Bitcoin: Peer to Peer Money!
Bitcoin may sound radical, but in the context of the history of money it's actually very sane, if you believe in individual empowerment and control of assets that is!
We don't discuss money, it's not even taught in school, possibly because to do so would be so eye opening everyone would become very skeptical about the historical concept of money as debt.
Money is at least as old as civilisation because in the oldest hieroglyphs we find ledgers, which even suggests that money is older than words.
Money isn’t value, money represents an abstraction of value; it’s a way of communicating value. It’s a language.
Money is used to communicate value to each other, how much we value particular goods and services.
Money is thus the basis for human interaction, but its history as a technology isn’t very well studied.
A brief history of money
For centuries social institutions were built around bureaucracies of people and these tended to be organised hierarchically, and with their own closed systems of rules, especially when we look at government and banking.
But with the invention of the internet this changed as we moved from platforms to protocol based social interactions. TCP/IP works without context everywhere in the world without reference to a centralised authority, and all you need to do to interact with it is learn the language.
Money has evolved from precious metals through paper money, plastic and Bitcoin.
Precious Metals
"The first major transformational technology moment for money was when money stopped being about the tangible consumption of intrinsic value, but became something that referred to value, as an abstraction. One of the most popular forms of these abstractions was to use precious metals to express value."
It took hundreds of thousands of years before we saw the introduction of precious metals. Historically, we start seeing precious metals in the beginning of the agrarian civilizations in the Fertile Crescent area in the Middle East. The Babylonians, the Egyptians, and the Greeks developed these precious metals.
Precious metals combine some of the most important characteristics of money:
- hard to find (scarce);
- easily transportable (at least when compared to a giant rock or a whole barrel of feathers);
- easy to divide (you can cut a gold coin into pieces and subdivide the pieces);
- and universally valued for aesthetic purposes.
Paper
The next step in the evolution of money was the idea of paper notes to represent the value of precious metal stored in vaults.
With the development banks which could store precious metals it became possible to issue notes representing the value of the metals stored by each person.
NB people initially freaked out about this idea and it took a good 400 years for the idea of a paper based money system to be widely accepted.
Plastic
The 1960s saw another evolution in money technology - the debit and credit card, replacing paper notes with cards.
Credit cards were the first form of digital money, but in essence this was the same as paper money - just a digital promise from centralised authorities to pay debt rather than clients holding physical paper.
Bitcoin
Bitcoin is just the latest evolution in money technology and possibly more revolutionary than the shift from bartering to precious metals.
"Bitcoin is the first network-centric, protocol-based form of money. That means it exists without reference to an institutional or platform context."
Client-Server/ Master-Slave Architecture
With platform based systems such as Facebook the architecture has a client-server structure: when you open an account with Facebook, all of your data is stored on their server and you as the client are dependent on them allowing you access. Facebook has the ultimate power to deny you access.
This is the same model as the traditional banking system: you have no control over the content of your bank account - you are merely the client, the bank the server. And when they decided you no longer have access to your account and the money in it, then you no longer have access.
Or to put it more harshly our money system, like Facebook is based on a master-slave relationship. You do not own the money in your bank, that money is basically the bank's fictional debt to you, a promise to pay, what you actually do when you deposit your money in a bank is give all of your monetary power to that bank, and you do it voluntarily.
But somehow you have fallen into this habit probably because you were never taught about the reality of the money system.
Bitcoin is different because it is based on peer-to-peer,TCP/IP. It is simply a technology where they money is actually yours and not based on a client-server, master-slave relationship of inequality and debt!
Thoughts and relevance to hive....
Putting Bitcoin in historical context is very important if you want to gain a real understanding of it's revolutionary potential.
Bitcoin as a technology is peer to peer, and it challenges the concept of the master-slave monetary system we currently have in the fiat world - where individuals DO NOT control their money, banks do through debt-issuing.
By putting Bitcoin in historical context it makes the technology seem sane and empowering, and it's a good way of helping people realise that maybe governmental and banking criticism of the concept is because it threatens their control over the money supply and thus the route of their power, it does this simply by existing and in simply existing Bitcoin makes us question the social context of money and helps us realise how insane and unjust it is.
It's also interesting to note that it's basically internet communication protocols that are the fundamental aspect to Bitcoin - it's the protocol over which no one individual has control, Bitcoin is thus fundamentally about communicative freedom, Bitcoin as money is just an application
This leads us onto an interesting link to blockchain based social media, aka Hive, which is potentially more revolutionary as a technology than Bitcoin.
On Hive no one individual controls the network, we have freedom of speech, freedom of communication, which is maybe more important than just Bitcoin which is merely a store of value.