The Bitcoin Standard: The Decentralized Alternative to Central Banking

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The Bitcoin standard owes its workings to Satoshi, the creator of Bitcoin, but the concept was popularised in 2018 by Dr Saifedeam Ammous, an Assistant Professor of Economics at the Lebanese American University. In his book, The Bitcoin Standard, Ammous lays out the inefficiencies and flaws of the central banking system, and so too the fiat monetary system, arguing for the adoption of Bitcoin as legal tender. What is the Bitcoin standard? Note: Every dollar you spend could be invested and vice versa. You hvae to choose but printing money tries to do both? We now have a tiger by the tail: how long can this inflation continue? If the tiger (of inflation) is freed he will eat us up; yet if he runs faster and faster while we desperately hold on, we are still finished!

BITCOIN STANDARD - resistance.money THE BITCOIN STANDARD - resistance.money

The fatal flaw of the gold standard at the heart of these two problems was that settlement in physical gold is cumbersome, expensive, and insecure, which meant it had to rely on centralizing physical gold reserves in a few locations—banks and central banks—leaving them vulnerable to being taken over by governments. As a dollarised economy, the US dollar will continue to serve as fiat currency alongside Bitcoin, but the move positions Bitcoin—the world’s leading cryptocurrency—as a transactional standard in the country. It is perhaps one of the most remarkable achievements of the Internet that an online economy that spontaneously and voluntarily emerged around a network designed by an anonymous programmer has grown, in nine years, to hold more value than is held in the money supply of most nation‐states and national currencies. A modern economy with a central bank is built on ignoring this fundamental trade‐off and assuming that banks can finance investment with new money without consumers having to forgo consumption.People are allowed to have ideologies, but it shows good faith to be explicit that this is what is being discussed: this is political ideology, not economic or monetary theory per se. Ammous is at least clear in affirming that “The political vision of Bitcoin” is essentially based around Murray Rothbard’s anarcho-capitalism: government should stay out of people’s lives (other than helping secure property). The book’s principle citations are from Rothbard and his fellow travellers, von Mises and Hayek (with some reference to other libertarian thought and modern Austrian school writers such as Salerno and Hoppe). The middle section of the book is von Mises and Rothbard on steroids. It has a feeling of lecture notes stitched together without the benefit of a serious editor: almost plagiaristic in parts, dumbed down for mass-market appeal in others, always displaying a touch of venom.

The Bitcoin Standard by Saifedean Ammous | Waterstones

This] should be required reading for everyone in modern society,” writes Michael Saylor, CEO of MicroStrategy, in his foreword to the latest version of The Bitcoin Standard (subtitled, the decentralized alternative to central banking) by Saifedean Ammous. In an economy with no recognized medium of exchange, each good will have to be priced in terms of each other good, leading to a large number of prices, making economic calculations exceedingly difficult.Keynes’ essay, ‘The End of Laissez-Faire (1926), cited disapprovingly and disingenuously by Ammous, is not some authoritarian agenda but a warning cry, to remember the true purpose of liberty against the despotic mastery of feudal lords, monarchs and church: abstract rentier capital had come to serve that role. Keynes recognised that to fight the more terrifying despots, liberal democracies needed to fight the lesser despotism of post-feudal rentier capital—largely based around the ‘sound money’ gold standard. A modicum of reform in the direction of intervention would allow individual human flourishing in a world gone bad. A kind of Biblical Jubilee to avert the End times. In contrast Ammous suggests that: Ammous describes what BTC has become in its promoters’ eyes: “a global hard money” to store financial wealth, which third party intermediaries can hold and trade on their platforms, much like banks do now. Noting the incongruity, he writes, “While this view of Bitcoin might sound like it is a betrayal of Bitcoin’s original vision[correct, emphasis added] of fully peer-to-peer cash, it is not a new vision.” The digital-gold-as-universal-money idea had indeed been around for over a decade before the white paper. But this had little (if anything) to do with Satoshi’s white paper, and was not the problem Satoshi was trying to solve: ‘casual’ transactions (read small and uneconomic for banks) settling with electronic cash without the need for a fiduciary intermediary. Ko je psevdonimni programer leta 2008 majhni skupini prejemnikov elektronske pošte predstavil »nov sistem elektronske gotovine, ki v celoti deluje v načinu vsak-z- vsakim in izključuje potrebo po zaupanja vredni tretji osebi«, je temu le malokdo posvetil pozornost. Toda stvari so se spremenile. To nadobudno avtonomno decentralizirano omrežje navkljub vsem preprekam zdaj ponuja trden denar ter z njim neustavljivo in globalno dostopno alternativo sodobnim centralnim bankam. Bitcoin standard analizira zgodovinski kontekst vzpona Bitcoina, ekonomske lastnosti, ki so mu omogočile hitro rast, ter njegove verjetne ekonomske, politične in družbene posledice. Had European nations remained on the gold standard, or had the people of Europe held their own gold in their own hands, forcing government to resort to taxation instead of inflation, history might have been different. It is likely that World War I would have been settled militarily within a few months of conflict, as one of the allied factions started running out of financing and faced difficulties in extracting wealth from a population that was not willing to part with its wealth to defend their regime’s survival. But with the suspension of the gold standard, running out of financing was not enough to end the war; a sovereign had to run out of its people’s accumulated wealth expropriated through inflation. I have personally no idea if the world would be a better or worse place today if we had continued with a free market and following the Austrian school of economics. Saifedean's views of the golden past are probably simplistic and the problems of today's globally connected and overpopulated world are probably far more complex than the author (or anyone on the planet) could possibly understand - BUT I can see with my own eyes that my generation's buying power is absolutely ridiculous compared to my parent's generation, despite us working significantly longer hours in supposedly much higher classed and higher paid jobs.