this post was submitted on 15 Apr 2025
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Is fiat better?
We drop interest rates in order to spurn more consumption, to hit an inflation target as technology lowers the price of goods, what would you call that?
Yes, fiat is a better ledger system for currency. Proof-of-work crypto has gotta be the most energy inefficient design in the history of humanity.
I call it capitalism. As long as the bourgeois controls money - whether that's gold, fiat or crypto curriencies - then it's going to drive a system based on infinite growth and consumption
The goal of PoW is to be resilient and neutral in order to build a secure consensus from parties that don't know or trust each others and it's the most efficient way to achieve that goal. We currently don't know other consensus mechanism that would be as resilient or neutral. There is Proof-of-Less-Work which is an interesting innovation from Alephium but it's still based on PoW.
How the bourgeois controls money in Bitcoin ? How can infinite growth happen on a fixed supply ? How consumption would increase if money tends to gain value over time ?
Money ≠ Capitalism
Money is a primitive technology discovered by human way before scribing. In fact the first form of scribing appearing is money. It's so old and so embeded in our civilization that we don't really know how it works or how it emerge. We have no proof that bartering existed before money, the idea that money was made to fix bartering issues is false.
Bitcoin ≠ currency
Bitcoin is not a currency, it's a decentralized p2p network of trust building a consensus over a common immutable history that qualify as truth. Money is the first application of it but we already have other usecase such as the free software OpenTimeStamp used during Guatemala's election for exemple.
Edit : Grammar
I never said or implied otherwise. I actually implied the opposite. Money isn't inherently controlled by capitalists, but a capitalist society needs to have the bourgeoisie controlling the money.
Because they own the massive "mining" operations that do the vast majority of the entropy generation. Those datacenters are capital. They also control the markets that determine the speculative value of bitcoin.
I never said or implied that. I'm actually a fan of David Graeber who wrote about that in Debt: the first 5000 years
You're describing the concept of a blockchain. Bitcoin is an attempt to use a blockchain to implement a currency. Of course it has failed as a currency, so they've changed the purpose to be a financial instrument that's easy to speculate on
This is the crux of why bitcoin is a shit idea. You can't be neutral on a moving train. It's far more efficient to establish actual trust instead of chasing a mathematical ideal of trust.
The core idea you're getting at is: because of the blockchain, you can be certain that when satoshis are added to your bitcoin wallet, the transaction was authentic, and as long as your key isn't compromised, you can trust that it will remain in your wallet. It's a neat mathematical trick, but you still need to be certain that your computer is secure, that the person isn't sending you money tied to a crime, that any third parties being used haven't built in backdoors, that your wallet isn't physically destroyed, and so on and so on.
It makes much more sense to have a handful of trusted entities (like with ssl certificates)
This doesn't make them controlling Bitcoin at all. Bitcoin has a polycentric governance when no single actor could control it. Mining is a more complexe than simply buying ASICs and burning electricity. Wall Street guys invested millions if not billions into Bitcoin mining company that have died because it was just rich guys knowing nothing about mining that thought that they would make tons of money.
Also while you're right that currently they are more private companies you could have governement-mining like Buthan is doing right now and has done for a few years. Community mining could also exist, I mean a mining pool is a cooperative design.
No. The blockchain is just the format use to store the data, the real innovation come from Nakamoto's consensus, and the difficulty adjustment.
Blockchain is a buzzword from the banking industry and fintech. Blockchains existed decades before Bitcoin but they weren't marketed as such. Even git (2005) works like a blockchain but with another governance and without all the decentralized BS.
Currency is the first application but we already have other uses such as OpenTimeStamp used during Guatemala's election of 2023 for exemple. And we will have more and more once client-side validation technologies such as the RGB protocole will be live for exemple.
It hasn't fail as a currency when you watch what is happening in some Africa countries such as Nigeria, Democratic Republic of Congo to name a few. Same for latin america with Peru or Asia with India or Vietnam.
Also the ammount in USD that is transacting on Bitcoin yearly is in par with other payment processor such as Visa, Mastercard and outrunning AmericanExpress.
Bitcoin will never replace state money even tho many bitcoiners idealize this. However there is a high probability that in the future many if not most or all of the state currencies will run on Bitcoin as it's more efficient. We are at the beggining it's like the 90s for the web when nobody thought that this useless technology will permit us to buy stuff online. But this is me speculating here.
Same for every single software... Banking, PayPal etc... are not immune to that.
You can also mitigate the risks proportionnaly to your wealth and threat model. Multi-device multisig is an exemple. Liana Wallet with miniscript and timelocked is another.
You don't have to be as secure for a few thousand sats, than tens of millions, than a full bitcoin or more.
We (human) are very bad at information security. Bitcoin had a strong impact on that field of IT, it is so big that in 10 years we have made enormous progress, significantly more than in the last 50 years of computer science.
How does Bitcoin is incompatible with that vision ? Any way I disagree with that statement and I think that these "handful of trusted entities" will indead use Bitcoin to transact. But again this is my point of view and me speculating.
SSL certificate also use asymetrical cryptography just like Bitcoin. How is this different since you also have to be sure that the private key of the "trusted entity" isn't compromise ?
The problem I see is people always want to raid the cookie jar. People want easy answers to crisis caused by previously misallocated capital, and the easy answer is to steal from fixed income, forcing people onto the risk curve.
This then dramatically inflates home values, leading to fewer children, and makes the rich richer via the cantillon effect. It also creates a debt trap via unfunded entitlements, which with fewer children just leads to an avalanche of debt, as politicians promise to keep the system running via more borrowing. Centralized control leads to a tragedy of the commons in our currency.
I agree with your ultimate assessment of money, but the security mechanism of bitcoin is an order or two less energy demanding than the security mechanism of the dollar. The US military is the largest consumer of energy on the planet. Projection is how champions of US hegemony attack bitcoin. Theirs aren't the best arguments for you to use, keep it simple and stick to the base condemnation of money and crypto's technological acceleration of it's potency.