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Why Bitcoin’s ‘Culture War’ Matters

Michael J. Casey is the chairman of CoinDesk’s advisory board and a senior advisor for blockchain research at MIT’s Digital Currency Initiative. Let’s talk about bitcoin, toxicity and inclusiveness. (Boy, my Twitter feed is going to have fun over the next few days.) To start with, let me take a position: I stand with those […]

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University Researchers Turn to Blockchain to Preserve Cultural Heritage

A team from China’s Tsinghua University has filed a patent application detailing a role for blockchain technology in protecting cultural heritage.

According to a patent filing submitted in April and revealed on Friday, three faculty members of the university have developed a concept for a system that can store and share digital versions of culturally important objects using a blockchain.

The three inventors – including Tan Jiajia, a postdoctoral researcher and Lu Xiaobu, the head of the university’s Academy of Art and Design – explain in the document that the system primarily consists of two parts.

The first involves a 3D computing model that can scan a culturally important object in order to provide it with a form in the digital realm. In the second stage, the system automatically stores each object’s data on a private blockchain via a cryptographic process called hashing.

By including other cultural heritage holders (such as museums) as participating nodes, they say the blockchain platform could eventually grow into a consortium in which each party will obtain a shared ledger of cultural heritage data and be able to update it with their own archive.

On top of that, the patent filing adds, the system will produce a hash for the full ledger on the private blockchain whenever it gets updated, which would be further transacted to a public blockchain for enhanced visibility.

The team writes in the patent:

“Based on the unique design of blockchain for exchanging information, the digital identify of each cultural heritage can be transferred among different parties at lower costs with higher efficiency, so that we can enlarge their economic and social values.”

While the document does not disclose exact details on how the private blockchain would be developed, the inventors indicate that their early stage exploration had been based on Tencent’s Trust blockchain platform – a product the internet giant announced in April of last year.

See the full patent application below:

Tsinghua University Patent by CoinDesk on Scribd

Buddha image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Crypto and Twitter: A Toxic Combination, a Troubling Future

OK, Ardor fans. You have your wish. Your favorite token is getting a mention on CoinDesk.

Not, perhaps, for the reasons you want. But they do say all publicity is good publicity. So, there you have it. The response to my column last week on layer-two solutions was mostly positive with the usual dose of critics, but it was the Ardor tribe who caught my attention when one reader’s tweet, complaining that I hadn’t mentioned the blockchain platform, prompted others to pile on with accusations of my bias and ignorance.

It got me thinking about how financial self-interest, which has always skewed people’s perceptions of the media they consume, is being taken to a new level when crypto tokens are involved.

I do believe blockchain technology and related ideas around prediction markets and reputation will one day help us sort through the free-for-all of competing truths that the social media age has produced. For now, though, I worry that all we’re doing is creating a global brawl of angry people, all believing that they and only they own the truth.

This is really not about Ardor. (From what I can tell, Ardor’s framework for enabling “child chains” makes an interesting contribution to the evolution of crypto technology.)

What this is about is how people invested in the multiple tokens attached to competing projects that similarly claim to be making some quantum leap in blockchain capability come to passionately believe that theirs is superior to everyone else’s and deserves more prominence than it’s getting.

In Ardor’s case, it’s the holders of the main platform’s ARDR token as well as those invested in the child chain Ignis token. But I could just as well be talking about holders of ETH, XRP, IOTA, BCH and yes, BTC.

Fanatical, blinkered investors are nothing new, of course. It once was the case with GE’s shareholders – definitely, not any more. It’s always been so for investors in Warren Buffet’s holding company, Berkshire Hathaway, and in this past decade we’ve seen it with Tesla. But there are two factors that make the phenomenon more extreme in the age of cryptocurrency.

The first is the sheer volume of coins and the large retail investor base they attract.

The second is that social media is now the primary means by which market-relevant information is distributed. And social media, for better or worse, is essentially anarchy.

Combine these two and you end up with something worse than the troll armies that already cause such public angst around social media. You get monetized trolls.

The scammiest way this plays out is with bots. Bailey Reutzel’s great little survey of some classic spam bot moments in “Crypto Twitter” shows how distorting the combination of crypto and social media can be.

But there’s also lots of human-led ugliness: anonymous trolls disrupting healthy dialogues with ad hominem attacks and coin-pumping tweets filling our news feeds.

Now I believe that, eventually, anarchic social media might evolve to point where it’s far superior to the traditional media model that preceded it. And, as I mentioned, blockchain-based “proofs” and skin-in-the-game staking systems might one day help us sort through this mess.

Under the old, centrally-managed system, where news organizations filtered the important public information before it reached its intended audience, there was an inherent constraint on the amount of information available. And there was an access problem.

So, just as ICOs have shown how access to capital might be democratized, one could argue that social media has also created a potentially more democratized model of access to publishing systems. (I say “potentially” because in many respects what has happened is we’ve shifted power from the old news establishment to a new form of media behemoth: the follower-rich celebrity – think Donald Trump, or Justin Bieber.)

However, with no viable, decentralized mechanism as yet for rewarding honesty and good behavior, or for processing information so that some kind of consensus can be formed around it, we’re left with noise. Worse, there’s a broken feedback loop in which metrics such as the market cap of a token or the followership of a social media account reinforce and confirm people’s biases.

We saw it with the XRP mob that jumped on the New York Times’ Nathaniel Popper after he cited bankers saying they weren’t using the token associated with Ripple. The mob was unleashed, ironically, by a former co-editor of TechCrunch and now vocal investor – Michael Arrington – who vehemently claimed that Popper must have made up his quotes.

The swarm of XRP fanboys was unmoved by the logic that for a reporter at the Times to do such a thing would be professional suicide – read about Jayson Blair for background on this.

Or there’s the IOTA gang that collectively pumped out an alternative narrative that my colleagues at the MIT Digital Currency Initiative who’d discovered flaws in IOTA’s hashing algorithm were conflicted by business interests. Or the gang of ethereum supporters who took as gospel truth Vitalik Buterin’s claim that CoinDesk is complicit in enabling crypto scams.

Attacks on the press have happened for as long as it has existed. That’s not a bad thing per se. Any functioning society maintains a vigorous critique of media organizations. Some form of bias is unavoidable in media coverage. It deserves to be questioned.

But news organizations are no longer the all-important filters they once were. They represent one, increasingly small sector of a vast array of sources claiming to offer relevant information.

And unlike those other individual and corporate sources, news organizations – the good ones at least, those that can get beyond their owners’ and their advertisers’ interests and practice sound journalism – shouldn’t be captured by the same heavily financial biases.

So it’s disturbing that we’ve gone from discovering Facebook’s #fakenews problem to the appropriation of that term by those who peddle the view that mainstream media is the main source of disinformation, to the even more extreme scenario in which a market for information is composed of participants with tokens whose value they want to protect.

If we’re going to tokenize everything, which may or may not be a good idea, this cacophony of competing truths peddled by different self-interested mobs will likely get even worse. What happens when celebrities and companies and dictators have their own coins, with armies of rabid supporters doing their bidding in this battle for truth? Decentralized solutions to this are still a long way off.

I’m not totally sure how we stop this train for now, except to make a plea formed by my own, unavoidable pro-journalism bias. I humbly ask that people in the crypto community have a little more respect for journalists who, while far from perfect, are at least trying to produce news and content that’s not skewed by their or anyone else’s investments.

Without them, what have you got?

Burning statement image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Warning: The Blockchain Could Rot Your Brain

Alice Ko is a Canadian CPA, a finance professional turned business consultant, and the founder of a marketing agency, Pivot Six. She holds a small cryptocurrency collection. Follow Alice: @thisisaliceko

Advancements in technology may be transformational. However we cannot forget that they also create adjunct problems.

For instance, social media addiction is a serious issue, the Internet spawned the need for instant gratification, and artificial intelligence has many of us worried about technological unemployment.

Unfortunately, blockchain is no exception. And yet, everybody wants a piece of the pie, and people are already pouring their life savings into cryptocurrency investments. Should we take a step back and reconsider?

Productivity paradox

Proponents everywhere tout that blockchain will make the world more productive. I’ve even made the argument that blockchain will force auditors and accountants out of glorified administrative work so they can produce more value for society.

Whether it’s in banking, logistics, or advertising, on the surface, it may seem logical that any technological change will create “productivity gains.” But before we convince ourselves that blockchain will be a time saver, consider the Solow Paradox.

Also known as the Productivity Paradox, this is the observation that “… as more investment is made in information technology, worker productivity may go down instead of up.”

I’ve witnessed the Solow Paradox in action while working in different offices alongside C-Suite executives and other consultants. I’ve seen working professionals barely able to work an Excel spreadsheet, let alone utilize the countless Excel formulas that could have made their work output more productive and efficient.

While some will argue that the technical incompetencies I describe above are the result of poor training and weak hiring practices. Shouldn’t the concern of the Solow Paradox be seriously considered if blockchain technologies are destined to have a stake in all industries?

It’s certainly possible that the misunderstanding of technology may very well add hours to our workdays, rather than subtract them.

So before we get excited and confident about so-called productivity gains, due care and strategic planning should be top of mind to ensure that workers and organizations are adequately prepared for the next shift in the technological revolution.  

If new technologies are thrown at workers without adequate understanding of and training on the tools at hand, this may cause further declines in productivity, elevated stress levels in the workplace (and stress leads to health problems), and ultimately risk creating even more work.

The slump in smarts

Blockchain allows for the validation of transactions through an automatically verified, tamper-resistant system. This causes many to dream of the days where middlemen (and their fees) will be gone, and when tasks like verification and audit will be obsolete. All data recorded in a blockchain will be trustworthy since transactions cannot be altered.

Sounds utopian – and yet, reliance on technology has been shown to negatively impact human performance. The Google Effect (not committing facts to memory because we know everything is on Google) is alive and rampant. In fact, recent studies show that 90% of people suffer from this digital amnesia.

So as we move toward trusting everything recorded in a blockchain, let’s consider what might happen to society’s ability to be healthily skeptical and to critically think for ourselves outside of a blockchain.

For instance, I still know many finance professionals who are quick to pull out the calculator function on their phones rather than crunching the numbers in their heads. Is it really because it’s more convenient, or have they simply lost the ability to do the math?

While some studies show that society is at risk of become less intelligent with its increasing reliance on technology, these studies should simply be a red flag. Maintenance of brain health and increasing use of brain power is necessary as our species collectively continue to solve problems around the world.

Scientific American puts it perfectly: “As we are freed from the necessity of remembering facts, we may be able as individuals to use our newly available mental resources for ambitious undertakings.”

So how do we guarantee this is the direction we are heading in with blockchain? Instead of relying on blockchain technology as the “be all end all,” we could consider blockchain as a type of backup validation tool to leverage our current systems rather than a complete replacement.

To ensure our critical thinking skills remain top-notch, let’s also retain the skill set to perform transactions ourselves despite technologies that can automate tasks for us (like calculators). Technology should support us, not replace us.

Shift in skill sets

I started my career in auditing so I tend to have a pretty skeptical mindset. Whenever I read a metric or statistic, I’m quick to validate the source. Transactions within a blockchain network inherently create trust, but I think the automated “trustworthiness” of these transactions will negatively impact social skills and human behavior.

How? We were taught to be skeptical about certain things growing up (e.g. always count your change), and depending on where you lived, you were probably taught early to trust certain organizations like the bank and the government. Now as adults, we inherently trust that our technology is reliable (when was the last time your phone alarm let you down?).

My concern is the impact of a future blockchain-driven trust economy on social cues. Will people still trust transactions outside of a blockchain network? Will blockchain become the primary validation method of all data? Will society become more or less trusting in general? Will a transaction or agreement made outside of a blockchain be legitimate?

If we do eventually rely on blockchain to validate and manage tasks and transactions, I foresee the decline of underrated skill sets and important social behaviors. With the loss of middlemen (think brokers, agencies, auditors), our mediary, negotiation, and project management skills might also deteriorate. With this in mind, now is a crucial time to start planning for this and figure out ways to mitigate it.

After all, we know from experience that new technologies dissolve existing problems, but will also create new ones in passing. Let’s prepare accordingly this time.

Brain MRI image via Shutterstock.

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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Time to Acknowledge – and Encourage – Women in Blockchain

Michael J. Casey is chairman of CoinDesk’s advisory board and a senior advisor of blockchain research at MIT’s Digital Currency Initiative.

It’s International Women’s Day – a good time for a mea culpa to the overlooked women in the blockchain industry.

Last week, Paul Vigna and I presided over a Museum of American Finance event at Fordham University to mark the publication of our new book, The Truth Machine.

We sold a good number of books. We were very happy.

But the event could have, and should have, been different.

The lineup of speakers, excellent as it was, was entirely composed of white men. It further reinforced the idea that the world of cryptocurrency and blockchains is a male-dominated affair, and it did so before an impressionable audience of relative newcomers to the technology.

We helped perpetuate an imbalance in which the narrative, the access, the culture and thus the development and policymaking behind this technology has been steered by a small group of similar male elites. In planning the event, we’d fallen for the oldest mind trick in the book, and it had been played on us by very own minds: the bias of habit and of insufficient critical thinking.

I’m especially embarrassed about this because I’ve been preaching for some time the urgent need for diversity in the crypto community.

My concerns are only slightly fueled by stories of the ugly “bro” culture and showy displays of wealth that permeate the crypto trading community. It is sad that the “lambo” crowd in general gets so much attention from mainstream press. Relative to so many other important elements of the blockchain and crypto ecosystem, it’s a sideshow. 

The bigger problem is that in those more important realms – the areas of software and protocol development, of entrepreneurship and of policy negotiation – male voices are also overly dominant. These are the people writing the rules by which this vital new technology gets to evolve. If our economic existence is to be defined by these new, far-reaching algorithms, humanity needs as a diverse an input as possible into their development.  

There’s no a shortage of brilliant female minds in this space. Those who suggest there is are guilty of the same circular arguments rife in anti-feminist arguments everywhere: that men are simply better at this stuff, as proven by their prominent leadership positions. “Better” is defined by its own, internal parameters. Men, wielding power, set the terms of the debate.

I know loads of women providing intelligent, outside-the-box perspectives on the challenges and solutions we face across the multi-disciplinary arena that blockchain technology resides within. I work for one of them at MIT. But rather than deliver some tokenistic sample of those names, I want to instead focus here on just one woman in this industry, because he story has helped me discover the pitfalls of my own biases.

Glaring omission

Recently, I was at a birthday party for Sandra Ro (a woman who, incidentally, masterminded the CME Group’s bitcoin futures policy before departing her position as that company’s blockchain just before they were launched to pursue a new blockchain-based commodity exchange project in Africa.) The venture capitalist Jalak Jobanputra was present at that party. When I mentioned our new book, she asked whether she was in it. When I said that I didn’t think so, she politely pointed out that her name had not appeared in Paul’s and my prior book, The Age of Cryptocurrency, either.

My first thought was, well, sorry, but loads of people weren’t cited; we can’t please everyone. But after pointing out that index contained just a tiny smattering of female names, she explained why she truly deserved to be included. You see, Jobanputra was one of the very first investors in a bitcoin venture. As early as 2013 she was putting money into startups such as (now known simply as Blockchain), the wallet and data services company that last year announced a $40 million new round of financing from the likes of GV (formerly Google Ventures), Lakestar and billionaire investor Richard Branson.

Like anyone’s at the time, Jobanputra’s investments were a bold bet. She saw an opportunity that only a few visionaries could spot. (I certainly didn’t see the potential of this technology at that time.) And in Jobanputra’s case, it was fueled by a passionate belief in its sweeping social impact, in particular its potential to improve the lives of billions locked out of the global financial system. (That rationale drove her to invest in another female trailblazer: Elizabeth Rossiello, who, in 2013 quit a traditional finance career that had included stints in investment banking for Credit Suisse in Zurich and London to set up shop in Nairobi with a bitcoin-based cross-border payments startup called BitPesa.)

The Age of Cryptocurrency was filled with stories of wild adventurers who’d bet big on bitcoin and on early bitcoin projects, the guys who set the foundation for all that has since come and will come.  There was no mention of Jobanputra. Yet she was surely as bold and as important as any of them. The book was well received and earned acclaim – as we hope will be The Truth Machine. But both need more stories like hers.

A vicious circle

Why did we overlook Jobanputra? A simplistic argument is that she hadn’t promoted herself sufficiently. Indeed, I only got to know her after the book was published. But that’s too easy. The reality is that we were part of a vicious circle in which structural barriers make it much harder for women investors, entrepreneurs and innovators to get their stories out and be noticed. Those barriers include being under-represented at conferences and in books, articles and media.

Those barriers often reside in our heads, reinforced by a male-dominated industry that doesn’t challenge the status quo. Well-meaning men will neglect to think sufficiently about these issues because there’s little downside to not doing so. There’s no imperative to break with that status quo. And so, we hit the trifecta: two books with underrepresented stories of women and a conference.

Importantly, women themselves are taking action to overcome these biases. Jobanputra, along with Ro, Rossiello and other women in blockchain such as CoinDesk Advisory Board member Maja Vujinovic, recently gathered in Brooklyn to set up a group called the Collective Future to advocate for diversity in the crypto industry.

But this effort will succeed more readily if men like us, who also care about diversity, start tackling their own biases.

And no doubt this column will prompt a backlash from some quarters. But for those who agree with us, this is surely the right moment to act. Unless you’ve been living under rock, you’ll know that the past year has produced a reckoning with the problem of male indifference.

The #MeToo movement is not just about egregious abusers of power like Harvey Weinstein. It’s about ordinary Joes – and Michaels and Pauls – who perpetuate the existing structure by doing too little.

Image via Shutterstock.

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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The Real Problem With Nocoiners

Marc Hochstein is the managing editor of CoinDesk. 

The following article originally appeared in CoinDesk Weekly, a custom-curated newsletter delivered every Sunday exclusively to our subscribers.

A nocoiner, according to Urban Dictionary, is someone who has no bitcoin. But not everyone who has no bitcoin is necessarily a nocoiner.

Rather, what makes a nocoiner a nocoiner is not simply the absence of cryptocurrency from his investment portfolio, but his sanctimonious attitude about it.

Urban Dictionary’s definition, which was posted in December – about the time the word entered wide usage in the bitcoin community – goes on to describe nocoiners as:

“….people who missed their opportunity to buy Bitcoin at a low price … and who [are] now bitter at having missed out. The nocoiner takes out his or her bitterness on Bitcoin Hodlers, by constantly claiming that Bitcoin will crash, is a scam, is a bubble, or other types of easily refuted FUD.”

In other words, a nocoiner is full of what philosophers call ressentiment, defined by La Wik as “a reassignment of the pain that accompanies a sense of one’s own inferiority/failure onto an external scapegoat.”

The Twitter user known as @crackbagged picked up on this psychological insight in a Medium post in June of last year, warning fellow bitcoiners not to gloat when the price reaches $1 million:

“The people you told about Bitcoin may turn on you and assault you. You might be accused of witchcraft and thrown down a well, or worse. The mind of a nocoiner (a person who has no Bitcoin) is a dangerous place.”

Marco Santori, a lawyer who’s represented bitcoin startups since the early days and now the president and chief legal officer of wallet provider Blockchain, recently tweeted his distaste for the word “nocoiner,” writing that “it has a bitter us-vs-them flavor to it” and “smacks of partisan tribalism.”

But nocoiners engage in tribal signalling at least as much as bitcoiners.

The nocoiner isn’t just skeptical or even bearish about bitcoin. He feigns epistemic certainty that it will fail.

A nocoiner doesn’t simply express doubt about the use cases for cryptocurrency – he declares, unequivocally, that there are no use cases at all, in the face of evidence to the contrary. (A subset of nocoiners will assert that the only uses are criminal, implicitly committing the logical fallacy of appeal to the law.)

The nocoiner mocks the bitcoiner’s evangelical fervor, but he is every bit as religious in his convictions – and nowhere near as endearing.       

The first use of “nocoiner” on Twitter is believed to have been in February 2017, though the term’s apparently been used in 4chan forums for several years. But nocoiners have arguably been around since long before Satoshi’s white paper. As long as humans have walked the Earth, perhaps.

In the late 19th century, Nietzsche compared the nocoiners of the day to tarantulas: “In all their lamentations soundeth vengeance … and being judge seemeth to them bliss.”

Mea culpa

Cards on the table: I myself was a proto-nocoiner in the late 1990s, a good 10 years before bitcoin’s Genesis block.

Working at a daily banking newspaper (a phrase that will be indecipherable to our grandchildren), I sneered at the dot-com boom and regularly gawked at F**ked Company, a website that printed unvetted rumors of layoffs and bankruptcies at the era’s highflying startups (what an edgy name, I thought then).

Incredulous about market valuations for companies with no profits or even revenues, I rolled my eyes and looked forward to the day when the the internet bubble would burst. Once this nonsense is over, I thought, we can concentrate on writing about serious companies. Like Countrywide, ha ha.

In my defense, a lot of those tech companies I scoffed at were indeed frivolous, and most went belly-up or got acquired. But the internet still transformed the economy (though the financial services industry less so) and the subsequent mortgage boom and bust were far more destructive, all things considered.

Even Fast Company is still around, while the tawdry gossip site that spoofed the magazine’s name is long forgotten. Its rapier-like subtlety lives on at the r/buttcoin subreddit.

To be clear: The lesson from that era was not that we should revere entrepreneurs or accept all technologists’ claims unchallenged. Rather, keep an open mind, think beyond the quarterly metrics Wall Street obsesses over, question your assumptions about how the world will always work – and don’t confuse a beautiful horse (the world wide web, bitcoin) with the flies buzzing around its rear end (, Mt. Gox).

In other words, you don’t have to hold or even like bitcoin. Just don’t be a nocoiner.

Empty pockets image via Shutterstock.

The leader in blockchain news, CoinDesk strives to offer an open platform for dialogue and discussion on all things blockchain by encouraging contributed articles. As such, the opinions expressed in this article are the author’s own and do not necessarily reflect the view of CoinDesk.

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Welcome to Bitcoin Country: Silk Road and the Lost Threads of Agorism

Dr Paul Ennis is a research assistant at the Centre for Innovation, Technology & Organisation at University College Dublin, specializing in bitcoin and blockchain studies.

In this opinion piece, Ennis takes a dive into the kinds of sub-cultures bitcoin and cryptocurrencies enable, tracing their origins in libertarianism – and beyond.

Not everything is tameable – that’s a truism that might apply to bitcoin above all.

Recently, researchers from City University and Stockholm University introduced the concept of the “bandit organization,” calling it “a form of association or ‘band’ (frequently led by a charismatic individual) that occupies a space outside national and/or international credibility but inside the everyday practical and moral organization of specific audiences.”

Bitcoin, as we all intuitively seem to sense, is not quite a community in any usual sense.

For this reason, I’ve started to describe it as a land of bandits, “Bitcoin Country,” a term that denotes a semi-autonomous lawless region full of bandits, some noble, some not, and most certainly not cohesive.

Too formless to be a country, too amorphous to be a company, you can think of Bitcoin Country as a kind of digitally decentralized frontier.

The outlaws

Historian Eric Hobsbawm provided an early model of outlaws as social bandits that, although often violent, were celebrated by the local community as heroic or defiant.

In this way, the origin story of bitcoin is deliciously outlaw, essentially one of the individual who, through an amazing feat, harangues the evil king. It’s all the better if the king has devolved into vice and avarice to the point of financial ruin.

The other, slightly more contentious hero, operated on the edge of the edge, is the black market within the black market, the bayous of Bitcoin Country.

“The fascists always use the narrative of ‘We are the white knights in shining armor protecting against the threats. We come here and we move out the dark with pure whiteness.’ That’s a false narrative because there is corruption in those castles. The real base of power lies with us. We are the darkness.”

In the above quote, anarchist bitcoin developer Amir Taaki sets out, in the context of a documentary about the original darknet marketplace, Silk Road, a common theme within digital libertarian culture: the establishment, broadly construed, is corrupt.

Not just corrupt, its corruptness is clouded in “whiteness,” traditional forms of organizational legitimacy, and it uses narratives of fear to ensure we place our trust in them.

We need police to stop crime, we need armies to stop invaders and intelligence services to stop terrorists. Taaki’s rhetoric is hyperbolic, but it contains, implicitly, two important insights. The first is that the organizational legitimacy of central authorities is connected to our placing our trust in them in exchange for protection from threats (Taaki calls this “babysitting” a little later in the speech).

The second, a cypherpunk view, is that a powerful response to this situation, in the context of the digital world, is the creation of technological systems that subvert this power relation, “the real base of power lies with us.”

Radical dimension

These systems Taaki discusses would strive to be trustless, having no central authority and, strikingly, they would not require legitimacy. It is crucial to remember that digital libertarians do not propose a counter-legitimacy belonging to them.

They do not claim to be the truly legitimate position. Rather they revel in being “the darkness.”

Their ideal systems necessitate no “babysitters,” no trusted third party, no “legitimacy” in any traditional sense. Given such an anarchic spirit, it is no surprise that digital libertarians are drawn toward those areas deemed off-limits by authority, such as the shadow economy.

Silk Road was never just an exercise in deviant entrepreneurship, but was “presented as a means to dismantle the state.” University professor David Golumbia notes that in the wider bitcoin discourse “the idea that government itself is inherently evil” appears with “particular force.”

It was a form of activism involving a political “prefiguration” that sustained the community.

Prefiguration is a concept found in the left anarchist and autonomist Marxist traditions and developed in relation to cryptomarkets. Like most forms of political radicalism, libertarianism relies on envisioning a world that does not yet exist. Aware that this is the case, radical activists often must discover methods that justify their faith in the project.

For the anarchist and autonomist traditions, this tension has emerged quite visibly in movements such as Occupy Wall Street.

As Mathijs van de Sande explains, prefigurative politics need to be seen in terms of the ever-evolving act of bringing into being the world its adherents wish to see, but without any mainstream engagement. Crucial to prefiguration is a subtle inversion within leftist thinking.

In traditional Marxism, the relation to the state is directly antagonistic; one is against the state.

In the anarchist and autonomist view, this becomes inverted. There, to borrow from the Spanish Indignados, “We are not against the system. The system is against us.”

This redefines the nature of defiance as a focus on how best one can build new worlds despite state “interference.” It manifests as a process of instantiation of abstract ideals to come through practices occurring in the here and now.

The overriding aim is to act “as if one is already free.”

Exit over voice

The state is to be escaped rather than replaced. In other words, “exit over voice.”

According to economist Albert Hirschman, the two options open to all dissatisfied members of an organization are exit or voice. One can either exit the organization or voice dissatisfaction.

Libertarians are infamous for their preference for exit or, at least, the option of exit and, as journalist Brian Doherty charts, there have been many attempts to escape what they perceive as the ultimate closure of options, the state.

The concept of exit has even led to attempts to establish entirely new countries, known as micro-nations, their failures documented in an obscure libertarian classic “How to Start Your Country.” Arguably the most successful forms of exit have occurred by simply moving out to sea, as encapsulated in our romantic vision of anarchistic pirates, but also in the most successful micro-nation of all time, the Principality of Sealand, an offshore oil platform located not far from the coast of Suffolk, England.

The Dread Pirate Roberts name evokes this pirate outlaw status quite explicitly (Ross Ulbrich, who ran Silk Road under that name, even notes this in discussion with Variety Jones). He had not just prefigured the world his community wanted to see, but had generated a space, a micro-nation located off the coast of the clearnet, where the law (seemingly) no longer applied.

In effect, what Ulbricht achieved was a quite unique marriage of high-minded digital libertarian ideals with the routine process of buying and selling narcotics.

For most participants, their engagement with Silk Road operationalized a sense of freedom to consume their drug of choice in the context of doing no harm to others, aligning participants with the cyber-libertarian philosophy of DPR.

Konkin’s influence

In more formal terms, organizational legitimacy on the Silk Road was ensured by reimagining the “mundane” act of buying and selling narcotics as an act of liberty.

For Ulbricht, the success of Silk Road was precisely in line with the teachings of his most important intellectual influence, Samuel Edward Konkin III. A relatively obscure figure, Konkin developed a strand of libertarianism known as agorism in the early 1970s. In his exceptionally detailed and thorough-going history of American libertarianism, Doherty references Konkin a mere five times and not once in any especially important manner.

Indeed, Konkin seems to have “fallen” out of the tradition, but this is consistent with his rejection of the Libertarian Party as inherently paradoxical, preferring instead to promote black market activism where one might “commit civil disobedience profitably.” It is not clear how Ulbricht first came across Konkin, but perhaps there was something of the kindred spirit to them, both had studied chemistry to an advanced degree.

Konkin proposed a dual course to bringing agorism into being: (1) a theoretical position known as “counter-establishment economics,” or “counter-economics” for short, and (2) the practical dimension of “counter-economic activity.” For Konkin only a small handful understand agorism, in the theoretical sense, but this does not mean that counter-economic activity does not occur.

Konkin was keen to celebrate the unconscious agorists that populate our world: tax-dodgers, black market operators, prostitutes and so on. This is where Konkin can be considered explicitly radical.

The creation of black markets was for Konkin an agorist act where small “pockets” of outlaw culture create markets more efficient than the state can provide. The more efficient these pockets the more people in the white economy will turn to agorism.

Konkin died in 2004, but he had foreseen, as early as the middle of the 1980s, that the internet opened up agorist possibilities. His remarks are worth quoting in full, given his influence upon Ulbricht:

“The internet explosion has led the American State – for now, at any rate – to throw up its tentacles at regulation of the information industry. Every legislative session, however, brings up new attempts to tax and control the World Wide Web. But consider this well: should the counter-economy lick the information problem, it would virtually eliminate the risk it incurs under the State’s threat. That is, if you can advertise your products, reach your consumers and accept payment (a form of information), all outside the detection capabilities of the State, what enforcement of control would be left?'”

This is, to be direct, quite simply what Silk Road was.

Even more prescient is that Konkin recognized the importance of encryption around the same time.

Noting that encryption meant the state “cannot reach the invoices, inventory lists, accounts and so on of the Counter-Economist,” Konkin’s proto-conception of the cryptomarket means he arrived at the idea before even the cypherpunks.

Rusted train image via Shutterstock

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