Austrian economic theories are an excellent starting point for learning about Bitcoin

Bitcoin is far more than a payment method. Bitcoin is a political statement. It’s a global currency that doesn’t have the backing of a government – and it’s for that reason that it is better than other currencies.

Understanding Austrian economics is a great way to learn about Bitcoin because the economic background allows us to understand why it makes sense as a currency, why it makes sense as a payment platform, and many of the use cases for Bitcoin – such as international currency.

A currency is a means of exchange. Currencies get their value from their power to function as that means of exchange. In the most primitive societies, something like corn can function as a currency. It can be weighed and scored on quality and can be traded for any number of goods. A cow or a television can be measured in “pounds of corn.”

Metals were used as a means of exchange because they held value more long-term than corn. Silver and gold don’t expire or deteriorate as fast as corn, so they can preserve value. Paper dollars representing gold and silver emerged because they are more easily handled than precious metals, and can be broken up to represent more granular amounts without using a chisel and a scale.

Even when dollars stopped representing precious metals, those paper dollars were given value because people agreed they have value. That value continues to fluctuate – when more dollars are flooded into the market, we value dollars less than what they once were. That’s why bread costs $3 today instead of $0.25 like it may have fourscore years ago. Sorry, I’ve been trying to use the word fourscore for a while now.

Bitcoin is a currency that gets its value from this use. People believe it has value compared to other currencies. It can be viewed as more efficient than dollars because it can be transacted globally without exchanging to new currencies. Because there are a fixed number of coins that will ever exist, it stores its value longer than a dollar that is subject to the whims of governments – and those Austrians were fans of currencies that best maintained their value long-term. It stores its value better than gold, which had an undetermined unmined quantity.

The Austrians were free market people. They saw the most advanced societies as those societies that welcomed the division of labor, which means societies that welcomed trade of products and services from the widest ranges of people. A currency that must be converted risks transaction fees and governmental overhead than can limit some people from sharing products or services – especially across country borders. By eliminating those obstacles, a currency can welcome more contributors into the economy to produce and consume.

Last, there are use cases for Bitcoin that benefit the individual, and the individual is the most important player in the Austrian economy. Everything starts with the individual – the want to spend. The need to produce. That is where man finds meaning according to the school of Austrian economics. Individualism is the center of economic theory, psychological theory, and social theory.

Those economists want to remove obstacles in offset to best enable individualism. In addition to a global currency that is more efficient than dollars at enabling this, cryptocurrency offers additional benefits to the individual. Man can skip the administrative hurdles that exist to promote, but are actually limiters to the economic sharing that exists in the economy.

Austrian economics is an excellent starting point to learn about Bitcoin because it is through this study that we learn how currency gets its value, the characteristics of a good currency, and the importance of a global currency in a world that is increasingly global in its enterprise.

Multiplicities of humans organizing via horizontally stratified rhizomes will overtake all existing centralized institutions within our lifetime

Multiplicities of humans organizing via horizontally stratified rhizomes will overtake all existing centralized institutions within our life. That’s a heck of a sentence, so let’s start by breaking it down before we get into why these rhizomes will take over.

Multiplicities are a large number of something – anything. In this case, large numbers of humans will organize into rhizomes. A rhizome is a concept based on a botanist term for an underground plant stem that extends horizontally to grow new roots and, at times, stem up to surface as a new, connected plant. The roots continue to extend horizontally, and the roots can form nodes, which send stems up to the surface. These roots and nodes can connect with other plants, or just continue to grow. This is in contrast to many plants which dig roots vertically to reach nutrition deep in the ground.

Like vertically reaching plant roots, most organizations are structured in vertical hierarchies. Institutions generally have owners and below them managers and below them workers. The workers do the actual building – the actual creating. Bosses and managers set direction and strategy for the workers.

There are many centralized institutions. Centralized institutions are any system where there is an oversight committee or gatekeeper in place to monitor and regulate the inputs or outputs. For instance, academia is centralized because there are federal and state requirements for both students and teachers dictating what must be taught and which students to allow. In banking, there are rules that dictate the flow of money and credit and interest rates charged. Even news organizations can be institutions if they have to comply with government regulation of content, or their ownership’s regulation of content.

In the next 50 years, these institutions will go away. The bosses and manager system will be replaced by less expensive and more-easily reached systems. Like the rhizomes, systems will be right under the surface, with quick access available for individuals. The future systems will be less expensive because people will be able to share their ideas directly with other people. Overhead will be eliminated. Also like rhizomes, the systems will be organized horizontally rather than vertically. This means that people will not organize themselves according to traditional hierarchies.

Traditional hierarchies will be destroyed as more people have access to more systems and more individuals. Consumers will have more options for the content they see and more choice in the source of products and services. Likewise, producers will have more options to create products and services for others. The big institutions are the current gatekeepers. Hollywood producers control the content that makes movies that people have access to, rather than it just being up to the people. News companies control content in newspapers, TV, and top news websites. Venture capital companies determine which companies get funding and, through funding, the ability to scale and reach a large audience.

While gatekeepers are incentivized to find great sources (people don’t want to watch, let alone pay for, bad movies), they aren’t as efficient as the completely free market, and they can insert their bias. The metoo movement started as a revolt against Hollywood gatekeepers that acted creepy because they held so much power over the careers of aspiring actresses. Political bias has had individuals (Gavin McInnes) and companies (Gab vs Microsoft) all but shut down by suppliers powerful enough to operate as gatekeepers.

These systems will be global in reach, and local in their availability. By eliminating these gatekeepers, more people will be able to reach an audience, regardless of their politics or gender. If no one gives them attention or money, it’s because no one thinks the individual is worthy of attention or money. Step your game up.

Technology such as Bitcoin and blockchain are making this possible. Bitcoin has the potential to eliminate banks and venture capital. This will allow more people to have access to funding and reaching customers. Not only are they means of removing institutional middle-men, but Bitcoin enables a lot of these other applications to work and to tear down institutions as well. By eliminating financial gatekeepers, individuals or companies can then bypass the corporate gatekeepers that would otherwise make them stick to their rules and boundaries in order to reach an audience. This is the case for modern movie and journalist content as well as products and services in the market.

Because of the burdensome overhead, there aren’t practical options to reach target customers. Music and movies must please the masses of they are going to make a profit. By removing the overhead and giving producers direct access to consumers, producers can profit if there are a small number of individuals that are interested in consuming their products – and those customers can be located anywhere in the world. This allows for more direct access to what consumers want, and what producers are good at creating.

In summary, multiplicities of humans organizing via horizontally stratified rhizomes will overtake all existing centralized institutions within our lifetime. This will happen because:

  • We will have more access to choices as funding becomes available. Through funding, we will be able to reach customers on a small scale, internationally.
  • As gatekeepers are eliminated, these will open up new job opportunities and business needs. These will not be filled by central institutions.
  • Technology, such as Bitcoin and blockchain, is enabling the overtaking of middlemen.

BITCOIN PROVES THAT THE “GLASS CEILING” KEEPING WOMEN DOWN IS A MYTH

This was originally posted at Return of Kings here: (link to article).

Bitcoin is further evidence that the “glass ceiling,” the idea that women are kept from reaching the ranks in corporations and in financial success because of a nebulous “patriarchy,” is nonsense.

Economists have disproved the glass ceiling on more than one occasion in the past, so the more well-read will not be shocked by this. Yet, the existence of the glass ceiling has remained a major talking point for feminists. The silence of feminists during the rise of Bitcoin has been deafening.

Bitcoin is an interesting case study because it is modern and doesn’t have the excuses that you hear when the glass ceiling argument breaks out. There is no Bitcoin establishment or “old boys’ club,” because Bitcoin has no establishment. Bitcoin is hardly established, and there is no one central authority.

Feminists claim that “institutions have always had biases” and “it’s a man’s game,” but Bitcoin didn’t come with any biases. It didn’t come with anything. It was nothing ten years ago, and its meteoric growth is well-known.

Bitcoin was created in 2009, a time where women had established themselves in various industries, most notably tech (see: Meg Whitman, Sheryl Sandberg). Nine years later, only three percent (at most) of Bitcoin use (suggested through Bitcoin community engagement) is by women.

Is this the patriarchy keeping women from investing? No. There is nothing that stops women from investing in Bitcoin. Women don’t even need to go to banks to introduce an intermediary which could discriminate against them.

So why aren’t more women investing in Bitcoin? There are a number of reasons for this.

1. Bitcoin is Boring

There are no emotions involved in cryptocurrency investing. Women are more likely to get involved in areas that stir their emotions, from the social sciences to humanitarian work to political rallies.

Bitcoin is mathematical. It was created with a white paper and some computer programming. Since more women take up studies in the arts or humanities than math, it is more difficult to understand the concept and takes more work.

Also, because women prefer soft subjects to hard ones, women end up in jobs related to the arts and humanities versus the hard sciences. They will be more likely surrounded by men and mostly women that also did not study math and computer science and will not be interested in—or understand—Bitcoin.

In addition, Bitcoin isn’t tangible. You can’t feel it in your hands, so you cannot wave it around to boost or lower your status without hopping on a male-centric Reddit page (HODL!!). This reduces the emotional connection to it because there is no physical thing to attach a feeling to. Where money can be a sign of prosperity or options, the numbers in a bit wallet are less tangible.

2. There Is A Lot Of Risk

Women generally value security and strength, which we have seen in relationship dynamics and the number of careers chosen as opposed to entrepreneurs. Men are more willing to take chances.

One of Bitcoin’s tenets is that it is less risky than fiat dollars because it is not subject to inflation and to crumbling governments, so it should be more stable. However, Bitcoin is still young and has a wildly fluctuating value. It is this perceived value that people see as risky, not the idea. It is these wild fluctuations in value that appeal to men.

Bitcoin is also a long-term investment. Bitcoin believers believe the cryptocurrency will be more durable than fiat and will be a superior currency. Women are much more likely to spend and distribute wealth than to build it through investing.

3. Bitcoin Is Competitive

Men eat what we kill. We evolved to eat the animals we hunted, and we still do that in the modern economy. In a tribal setting, the man that hunted the most for his tribe was rewarded with more power and more women to bang. We evolved to be competitive and to fight for the top spot.

These days, men are more likely to participate in sports and more likely to try new things to get ahead (see here). Bitcoin is competitive with other cryptocurrencies as people (men) race to market and grow their currency of choice. Bitcoin is also competitive as a store of wealth. The more men own, the more men can use our primal brains to associate with power and sex.

These are the reasons why only three percent of Bitcoin users—a completely decentralized, open world without bias—are women. These are the same reasons that men make more money than women in the workplace. It isn’t the patriarchy. It’s the evolutionary and behavioral differences in men and women that decide the numbers.

Men are competitive, find freedom in long-term wealth, and are more excited about new ideas and a new, selfish way to increase wealth. At least, more than women.