What Is To Be Done

“Without revolutionary theory there can be no revolutionary movement.”

At the end of the 20th century humanity was given the most powerful tool that the world has ever seen: the internet. In less than 20 years, the internet has evolved from being a slow, complex, obscure piece of technology to connecting billions of people today with just the flick of a button. Despite the fact that we can use the internet to communicate more efficiently, and exchange information with magnitudes more efficiency then just a few decades ago; we still find the shadow of fascism grow larger with each passing day…

Control of our respective economic, political, and social systems have been overtaken by corrupt capitalist and their political stooges, and now they seek to take over the internet itself. It does not matter if you are German, Korean, Argentinian, or American–all of our systems have been corrupted in the same way, with the same methodology, by the same class of people. Corruption reigns supreme, while the basic needs of society as a whole are ignored. Self-determined humans everywhere have been hamstrung by economic corruption, government impotence, and social cowardice to ensure that the wealthy will always win.

This is THE defining feature of ALL so-called democracies around the world. Unless we choose to fight this corruption directly and to strike at the single root which unites them; we will continue to suffer under their exploitation. The single feature which unites them is fiat money; and that is the very structure–the very object–which we seek to destroy. Through the promotion, advocacy, and use of digital currencies we can destroy the contemporary financial system, which is controlled by the 0.1% at the expense of the whole of society.

Politics and Economics are Inseparable

We must understand that there is absolutely no division between economics and politics. It is by the very make up of our political and monetary system that all economic conditions are determined. It is only when we fully recognize that political power is only economy power that we will be able to create the revolutionary struggle against all state monetary systems and their kleptocratic allies.

Never has there been a greater need for true radicalism to emerge to challenge the fascism hidden in the folds of all governments. We must radically divide ourselves from every other supposed ‘political’ group in order to make our struggle clear. Each and every sort of progressive movement throughout the world today finds itself under the constant glare of the fascist machine to ensure it remains complacent and broken. Threatened to be violently crushed back down each time we rises up; the people callow under the glare of the machine like cattle calmed by the hushes of butchers. For the first time in history, there is a real possibility for true international proletarianism, if we choose it.

We can use the internet to as our revolutionary vehicle to organize ourselves, and digital currencies as our method to create economic independence. All that is left is to create the organizational structure that will create a new future, in solidarity will all oppressed people everywhere.

As this new form of power grows to show what it is capable of, a new power structure will form–a polis within the internet itself, which will become the citizenship of the future.

From this base of power we can start to organize against all states, and the corporate machines that control them. As our membership grows, so will our political practice, and our political consciousness. This is how we build a new future outside and beyond the horrors that currently haunt the future which we are marching into.

Beyond The Spectacle

Despite the incredible power of the internet, today we stand stunned and seduced before it; subject to it, rather than subjugating it. We are hypnotized by the taste of the social architecture; the dazzle of infinite distraction. We succumb to the inertia of the impossibility of our task; feeling no more than a hollow glimmer that a different world is possible. Today even the most ‘radical’ solutions are little more than an impotent sigh; a sign of caring imbued with defeat from the start. Not an action of true struggle, but the compromises of slaves who know freedom can never be a reality.

The Left, crushed and broken for decades, has become little more then a false idol to placate the the liberal masses. To offer some illusion of progressiveness is the sole duty of liberalism, while allowing for nothing to change. Even socialist today are little more then apologist for the capitalist system, only wishing for a more ruthless exertion of state control upon capital.

If want to create a new way forward, the only way is to break the bonds of the old system itself: Money.

By break the antiquated money system of old, while cultivation any new one they do not control; we can change everything.

The New Way Forward

Every party today wishes, beg, and cowtows for The Machine of State-Capitalism to change its horrific ways.

Where is the party to which would stand and fight against this Machine? Where is the party that would crush it where it stands and to uncompromisingly disassemble each and every last cog of the machine to make way for a better tomorrow? Where is this party that proclaims to be a true representative of the people? This party is nowhere to be found, which is why we must lead to a new way of life that is beyond parties and politics.

It is this false hope that a ‘party’ can steer the state and use that power for good which is the greatest enemy of our cause. To believe in the legitimacy of a corrupt electoral system only empowers the corrupt, and legitimizes their evils. To truly create change we must go beyond the false political consciousness we have been given, and construct a radical new one.

No Gods of Government, No Masters of Money.

We radically divide ourselves from the liberals, socialist, communist, and libertarians who refuse to work towards a better tomorrow without the state, and against the capitalist machine. They beg and plead to reform this horrible system, and would rather tolerate a corrupt, inept government; then acknowledge the puppet democracy for the false idol it is. It is only when we realize reform is impossible, that we will be free to achieve inevitable:

Revolution!

To Create a Revolutionary Future

We must create our own organization that stands against the evil anachronistic ways of the past, while radically embracing the liberative power that digital technology harnesses. We must make a global technology union for all people that will stand, serve, and protect the rights of each individual against the interlopings of all thieves; be it in the form of banks, the state, or violence itself. This is what will become the citizenship of the new society that is forming in the shell of the old.

Everything we need to change money–which changes everything–is in our hands. The only thing left to do is to build, collaborate, and create the future we must have.

“For the anarchist, freedom is not an abstract philosophical concept, but the vital concrete possibility of every human being to bring to full development all of their powers, capacities and talents with which nature has endowed them, and turn them to social account.” ― Rudolf Rocker

The Reappropriation of Our Economic System

What we have been taught about money and the economic system is little more than a collection of lies, and propaganda shoved down our throats at the point of a knife. Our economy is far from being fair, or free; and we are exploited by the whims of capitalist whom have received the seal of approve from all governments. The financialization of the economy by the state started with the creation of the Federal Reserve, and finalized with the abandonment of the gold standard. This was the beginning of the end of money having independent value from governments. When governments of the world discovered at Bretton Woods that they could simply end the convertibility of gold, and all governments could move forwards with only fiat money they were exuberant. This removed the greatest check on government power that has ever exist: the power of the purse.

To Smash the Chains

The legacy of capitalism is deep, profound, and all encompassing within our society. The reification of everything by capitalism has left no stone unturned, and has sucked every facet of life into the economic sphere. This is not the capitalism that Smith and Ricardo understood; but a distorted, anti-human Deus ex Machina careening toward the destruction of both humanity and Earth. This greatest evidence of this is in the near complete and total environmental destruction that we have experiences all over the world with the sixth great extinction of species from this planet. Indiscriminate of nationality, race, or origin; our oceans, skies, water, and land has all been polluted and raped by the powers that be. The very governments that were empowered with protecting our sacred rights were overthrown by capitalist gangsters; thugs in suits who auctioned everything off for a meager thirty pieces of silver.

The issue is not with the capitalists who only know corruption and theft–this should be expect from them most of all! The issue is with the state, politics, and the corruption that has enveloped all aspects of our social spheres. This system is corrupted and festering to the core; it cannot be saved, nor should it. The men of politics who hold themselves in such high esteem for being the negotiators of the prostitute our political system are the very ones that hold us down to be raped and used, again, and again by the capitalist machine. Our cries of consanguinity are never heard; we are little more than objects to be tolerated by them, while they exploit us to our deaths. If we are to be liberated, and free, as we were promised by our forefathers and the constitutions that govern us, than we must smash the chains of economic enslavement which we keeps us tethered to the destructive machine that we call capitalism.

To Break a Monetary System

We must harness the power of markets and entrepreneurship for the good of all, while dividing ourselves from the parasitic nature of capitalism. We must rip power away from a corrupt state which empowers a very small, exclusive class of people to the right of destroying the world of tomorrow, for a collection of trinkets today. If we are to ensure that we have something to offer to our children other than imprisonment, and a burned Earth, than we must choose to end this system of abuse now, today, and permanently.

This can be done. We have the means to break this totalitarian socio-political-economic system of the old world, and usher in a new era of global development outside of the hands of both the state, and capitalism. We can reappropriate our respective national monetary systems, for new, independent digital ones. Through this single action alone–through the reclamation of our economic power–we shall create a domino effect that shall ripple throughout the economic, political, and social structures of the world. Through using an independent money whose control and power comes from outside of the state, people can reappropriate their economic power for themselves. This will come at the direct expense of the state and capitalist who bleed us like the vampires and leeches they are. By breaking the monopolistic control of the means of exchange by the state, we shall expropriated the system of exchange, and the means of exchange itself back to its rightful owners: the general public.

We see the corruption of their system. Beneath the shimmering veneer of capitalism’s accomplishments and supposed progress, lay the untold billions of shatter lives. At its base we see that the law is nothing more that offical violence–state sanctioned terrorism with propaganda from a capitalist third estate. To fight their violence we must use the most powerful weapon at our disposal to rid ourselves of this barbaric system:

Non-violent, direct economic action

Through simply using another form of money, we banish the violence and vicious fist of the state from the economic power that each one of us generates. No longer would the state have the ability to rob us, nor would they be able to fund their crimes, or continue their corrupt regimes. To cripple the monetary system would strike at the very heart of the corrupt state-capitalist machine, and would cause for it to come to a grinding hault.

International Money for All

Each state is invested into its own system of governance, money, and taxes so that the small powerful elite can rule over all for their own pleasure. They keep their power not through democratic means, but through oppression, division, regulations, controls, taxes, boarders, prisons, levies, and so much more. This is not for protection of the masses, but their oppression. This is not create justice, but to maintain injustice. Governments create these artificial rules and regulations so that they may steal from their people, and keep them divide and silent. We must see their petty tactics for what they are, and see the magnitudes of our own strength which we have in our numbers.

For the first time in human history we can smash these artificial boundaries and false consciousnesses of nationality and statism, and find solidarity in working together through simple rejecting their corrupt economic and political systems. There are billions of people across the global that create trillions of dollars of economic wealth each year; and yet these very same people live a life of poverty and insecurity from the exploitation they face. Through creating a new popular front against capitalist exploitation under the guise of the state, we can create a new economic and political movement that can break the bonds of debt that have enslaved us.

Using digital currencies as a political action, we can reappropriate our economic wealth away from the hands of corrupt politicians and their capitalist allies, while create a revolutionary new way forward. This single action alone can ensure that we will no longer be enslaved to the same system of debt bondage that has created the conditions of the world today. Together, as a single unite body of free people, we can banish the last vestiges of slavery from this planet for all history moving forward.

The crux of power within this system is control of the economy. This control is exerted through the monopolization of the object of exchange: Money. Governments steal fragments of the wealth from each and every person on this planet through taxation and inflation, while also give themselves the power to punish with legal violence and death to anyone who opposes this monopoly. The minders of this monopolies are the capitalist banksters, thugs who strut about in fine suits with no shame of their avarice, or the blood that taints their money. Through the direct expropriation of the system that benefits only the 1% at the expense of everyone else, we will create better conditions for the great tide of all.

International Direct Economic Action

We do not seek to create a party or to organize with titles and salutations; we simply demand direct action. We understand the most significant action we can take is to refuse to participate within the old economic system, while building our own independent one. Through boycotting fiat money and using digital currencies instead, we create a dual power of both economic boycott from the current system, and economic solidarity with the new emerging one.

This new system of exchange is not based upon the false nationalities that have been assigned to us, but upon the permanence of mathematics that applies to all of us. It is a form of money that is inclusive of all peoples, regardless of whatever oppressive state one may be forced to live under. Most of all, bitcoin is a form of exchange that is outside of the control of both statist scum, and capitalist pigs. It is a totally new form of money upon which we can build a new system of exchange, and an independent economic system. If we are ever to liberate ourselves from the chains of capitalism, and the impressment of debt, then building a new and independent economic outside of their control is the only way that we can move forward.

Bitcoin and other digital currencies can be the tools upon which we build this great new economic and monetary union–but only if people are willing to learn and participate. We know that there is a deep people problem with bitcoin, and that we will need to educate and agitate if we are to create a real and substantial change. This is the start of the global economic revolution that will smash down the artificial boarders that separate us, and will economically unite us against our respective oppressors. Bitcoin is the new economic Popular Front against the exploitation of capitalist, and enslavement from tyrannical state governments around the world.

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Next: Bitcoin, Economic Resistance, and Justice

Revolutionary Syndicalism of Bitcoin

Buried deep in the annals of history we find the powerful revolutionary praxis of syndicalism. Originally a radical movement for trade unions; syndicalism pulled its principles from “Reflections on Violence,” by Georges Sorel. In this revolutionary text, Sorel explores violence and how it can help humanity save itself from the barbarism it finds itself stuck within. The influence of this text helped create the largest working class movement in France and around Europe in the early 20th century.

During the October Revolution in Russia when the bolsheviks seized power, it was the anarcho-syndicalist, armed with these teaching, who valiantly fought both the corrupt communist army of the bolsheviks and the imperialist white army of the West. In the 1920s the fascist vulgarize syndicalist teachings to give themselves powerful, personalized mythos, in which they anointed themselves with divine right to rule over all as emperors. As dangerous as this praxis may be, it also may hold the key to liberation from the tyranny of our time. If we are to take the teaching of syndicalism and imbue them into cyberspace, we may develop one of the most powerful modes of organization ever conceived: The Digital Federation.

Revolutionary Syndicalism

The profound power of Syndicalism arises out of the nihilistic tradition of taking the mantel of God for oneself. Those that are of the Syndicalist’s teachings seek spiritual meaning, and a bond with one’s own God for which they fight: themselves and their communities.

This is not some imaginary, castrated god found stapled up on sticks; pathetic and defiled, to be made an example of. Not a god of religions or institutions, but the God that lives inside of us and insists that we forge a better world. The is a personal spiritual meaning that can only be found inside of ourselves; a personal knowledge that our struggle is righteous and meaningful. In many ways syndicalism is the jihad of the working class, and the General Strike is the apocalypse of the ruling class. Sorel, who has been called ‘the most powerful socialist since Marx’ is widely unknown today. This is mostly because of the spectacular conclusion in which Sorel presents his theory of The General Strike:

“Syndicalism conceived the transmission of power not in terms of the replacement of one intellectual elite by another but as a process diffusing authority down into the workers’ own organizations. Those organizations, unlike a system of political democracy replete with Rousseauian baggage, provided a pattern of genuine and effective representation. Most importantly, the violence employed by the proletariat in the course of the general strike bore no relationship to the ferocious and bloodthirsty acts of jealousy and revenge that characterized the massacres of The Reign of Terror.”

Sorel unapologetically embraced that we must understand violence as a tool that the state has monopolized for themselves to create the oppression we experience today. The Revolution can only be created through direct struggle against the illegal transgressions of the state unified with capitalism. It is only from demanding from ourselves, and our communities that we can build a true, and radical change that does not allow for the putrid slime of politicians and capitalists to keep a foothold in our systems of government.

A Breif History of Anarcho-Syndicalism

The power message of syndicalist can and is easily be vulgarized to serve national socialist, and their racist, authoritarian, ignorant perspectives. Fascism is the greatest form of government for the weakest and most sniveling cowards of democracy. This is what happened in Italy in 1924, Germany in 1932, and Spain in 1936 where the fascist seized power because of the cowardice of pathetic democratic governments that could not stand against them.

The fascist were able to come into power through this mystical perspective they carefully constructed with sinister propaganda that created the cult of the Great Leader. However, each of these seizure of power were valiantly resisted by the people on their own accords. The largest anarcho-syndicate ever created fought a long and bloody civil war with the fascist in Spain from 1936-39. The blasting cap of syndicalism finds its praxis in direct action, personal liberation, and knowledge that the revolution must be built and fought for. When Franco seized power in a coup in 1936, the CNT–the Spanish Anarcho-Syndicalist–rose to the occasion and heroically fought the fascist for three long and bloody years. Great citizens from around the globe answered the call of justice, and fought shoulder to shoulder with men and women of all nationalities, including 2,800 brave Americans. With the defeat of the CNT, and with the most powerful anarchist having been killed or jailed, anarchism moved underground to be forgotten for another age when the people would be ready to struggle again. That age is now upon us, and the spectre of anarchism has risen from its shallow grave to haunt the digital realm until its prophecy is realized.

The Digital Federation

The time is upon us to create the organizations that can lead a new way forward. We have the technology, and we have the will power–now we must organize. Over the coming years we will find one another in the streets, and on digital forums spread through cyberspace. We will organize from the shadows, and will strike out viciously from the night, only to abscond back into the digital sphere where we are Sovereign. Using the powerful ideology of revolutionary syndicalism we can create the digital-political organizations that shall allow for us to break the state, crush their capitalist allies, and build a new way forward. We openly declare that our ends can be attained only by the subversive overthrow of all existing social conditions through the empowerment of all people within the digital sphere. Let the ruling classes tremble at the revolutionary power of bitcoin, the personal empowerment of privacy through crypto, and the auto-didactic nature of the internet itself. There is nothing to left to lose but our chains, and there is a whole world to liberate.

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Next: The Reappropriation of Our Economic System

Antifragile Bitcoin

Thieves love bitcoin. Why wouldn’t they? Pseudo-anonymous digital cash that can easily be laundered, and taken while being personally physically secure from any sort of immedate counter-aggression. What more could a thief ask for? Not to mention that you can make off with much more than in any typical bank robbery, like the most recent bitstamp hack, where the bandits made off with around 19,000 BTC.

At first stealing bitcoin was pretty easy–here is a list of several early hacks put together on bitcointalk. But you can see that over time it has been getting harder and harder to rob exchanges. Why is the good life of a crypto-thief going extinct?

I’m sure that bitcoin thieves dress like this.

It is because crypto-thieves are putting themselves out of work–they are helping solve the security issues of bitcoin! We can see this evolution over the course of the last few years with hacks becoming more sophisticated, detailed, and sneaky as the price of bitcoin grows, and the network expands to include more people. Now altcoins, with less savvy developers, and smaller exchanges which lack the same resources as major bitcoin exchanges are being targeted more frequently. This is occurring because the security infrastructure around smaller exchanges that cater to altcoins are less developed than bitcoin, so altcoins are being targeted more like the NXT hesit from BTER last year.

As the various altcoin ecosystems develops, they will either gain enough traction to exude the same antifragile properties of bitcoin, or drown under the weight of major attacks. Either way, the whole ecosystem evolves so that with weak coins die, and powerful ones survive. The same is true for exchanges as well; with each major attack or exploit that is carried out, a ton of money is stolen, but then the hole is then almost immediately fixed, or the exchange dies. This one-time ‘security fee’ now raises the bar for all hackers; as the post-mortium analysis of what happened is generally shared with the whole ecosystem of exchanges. The more people try to exploit exchanges or the crypto-currencies themselves, the more flaws are found and fixed, making the system strong and harder to exploit in the future.

The Antifragile Nature of Bitcoin

From http://www.innoguru.nl/

Bitcoin is antifragile, meaning that the more you try to break it, the stronger it becomes. That is why the exchanges with horrible practices like Mt. Gox have died, or at least will be reanimated under much better security. This is not a fluke, but is how distributed networks function; as they are antifragile.

In fact, the only reason that bitcoin has even evolved to where it is today is because of its antifragle properties. No matter what has happened–the demise of the Silk Road, Mt. Gox, and almost 1/2 of major exchanges have failed–bitcoin is still here. Furthermore, bitcoin has not just remained, but security has improved dramatically both on the side of consumers, and exchanges in response to these catastrophes. Even the core protocal is getting more secure as more time and energy is spent developing bitcoin, with features like multisig not even being introduced until 2011. I am sure after the most recent bitstamp heist there will be a post-mortem amongst the major exchanges to ensure a theift like this does not happen again.

This antifragility goes beyond just learning from mistakes, as the whole bitcoin ecosystem works offensively in response to such events. Major exchanges are not sitting around waiting to respond to a heist, they are innovating and developing to make themselves more secure and more difficult to steal bitcoins with each passing day. Coinbase’s vault is a great example of this. When people started to complain that Coinbase could go the way of Gox, Coinbase responded with multisig vault, which means they couldn’t even steal bitcoins stored there if they wanted to! I’m not one for keeping coins with any service, but it’s good to know that such features are available for those who may not want to secure their own coins, or spend the extra bits on something like Trezor.

This kind of development in turn makes it easier for the average consumer or business to have confidence in bitcoin. This paired with already low economic barriers to entry to use bitcoin creates a payment system that is both more secure, and cheaper to use that any other payment system that has ever existed. Anyone with a computer can setup an webpage and sell something to people directly for bitcoin with much more ease, and less expense than any other payment system. This lower barrier to entry is also creates a greater degree of resiliency within the network, as it distributes the risk for the ecosystem among many actors, unlike centralized payment entities.

The price of bitcoin, which has taken a major hit in recent days, also works in an antifragile nature. Having made absurd gains over the last two years (for good reason), the market was overheated, and so a large sell-off started. Although this became a vomit-inducing ride for some noobs to the game, this was actually a good thing! Such an adjustment in price not only shook out speculators and capitalist of all kinds, but it allows for the price per bitcoin to become ‘reasonable’ to people who were looking to invest, but thought bitcoin was overvalued. This drop in price allowed for a whole new wave of folks to invest, which in turn distributed the network even more. As the price rises and falls, we will see this process happen over, and over again.

The Evolution of the Bitcoin Ecosystem

The advent of colored coins, multisig wallets, and properties contracts all seem like they will come to fruition in 2015, and are all going to bring forward a new boom in the bitcoin ecosystem. Again, it will be through a string of thefts, hacks, and exploits which will allow for service providers to improve themselves and allow for the network to get stronger. It is this process of creative destruction that allows for the demise of smaller weaker parts of the network which will allow for more evolved ones to take there place. I am confident that as we move into the coming years that service, security, and creative thefts will only get better, along with the security response to each event as well.

So this one is for the thieves, criminals and neer-do-wellers! Keep doing what you do best, it improves the security of the bitcoin network and ecosystem, and reward those for their unsolicited pen-testing services.

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Next: What is the intrinsic value of Bitcoin?

Bitcoin’s People Problem

“I insist that it is not the handful of parasites [of capitalism and the state], but the mass itself is responsible for this horrible state of affairs. It clings to its masters, loves the whip, and is the first to cry Crucify! the moment a protesting voice is raised against the sacredness of capitalistic authority or any other decayed institution. Yet how long would authority and private property exist, if not for the willingness of the mass to become soldiers, policemen, jailers, and hangmen. The Socialist demagogues know that as well as I, but they maintain the myth of the virtues of the majority, because their very scheme of life means the perpetuation of power. And how could the latter be acquired without numbers? Yes, power, authority, coercion, and dependence rest on the mass, but never freedom, never the free unfoldment of the individual, never the birth of a free society.” –Emma Goldman

Bitcoin’s People Problem

Bitcoin has a very serious problem, and it has nothing to do with the technology of bitcoin–it has to do with the stupidity and ignorance of the common people. Everyday I hear from the common man the same damn foolish straw-man arguments for why bitcoin cannot work. Again, and again I hear:

“But how does it work?”

“Who controls it?”

“What if it fails, or the governments stop it?”

“There’s nothing backing it–it’s not even real money!”

And my personal favorite, “Bitcoin is dead”

Stupidity is a poor excuse for failing to understand how technology and money works, but alas, we are in a world ran by a union of morons, commanded by sociopathic capitalists and politicians. Those who believe in the demise of digital currencies are the same sniveling cowards who cannot see past their own avarice and callowness to ever accomplish something great–they simply want to punch the clown each day, satisfied at the safety of being commanded by another. They are cowards happy to obey governments and laws that can only be defined as illegal and tyrannical.

These are the fools who would pled that the bitcoin’s cause can never succeed. They do not understanding the purpose of bitcoin is the struggle against the system as it is. The fools bitch of being ripped off by banks, and then offer hollow stares when told of what bitcoin can do. They demand to be told how bitcoin works, without a damn clue how fiat works. The only problem that bitcoin has is that stupid people do not want to be free and independent–they demand to be ruled and governed, and to drag us all down with their sad need to be controlled.

These clowns tell me of how pleasurable life is on their knees, and how they are allowed so many of the scraps from the table of Empire! That a life of looking towards the ground is not only a great pleasure, but one of deep honor! These people love their duty to their God of the state, and their masters of capitalism. They will offer any excuse to justify the needs of their master, any reason to qualify the barbarism they execute daily. There is nothing that the state can do that the slaves cannot create a justification for. If these are the very idiots that we must rely upon to help us create our change, I must animate the seriousness of the dilemma in which we have been caught. We shall never succeed if we believe these people will welcome the liberation from Plato’s Cave.

A Confederacy of Dunces

There is a whole union of morons parading about the world as the false champions of justice, dragging innocent dead bodies behind them. How they scream their idiocy from the tops of their lungs:

“War is Peace!

Freedom is Slavery!

Ignorance is Strength!”

See their foolishness for exactly what it is, and let the crimes and injustices which they have taken part in speak directly to what they are. Understand with every fiber of your being that the enemy is not some nameless, faceless army of destruction; but the people in your community that tell you, “This is just the way things must be.”

These are the people that are gleefully celebrate the manufactured democracy of two-party totalitarianism. They are slaves to all of the trinkets they have collected through debt, they militantly pay taxes which are used to create illegal wars, and they demand that the law be respected at all cost–beyond that of even the law itself. They thinking nothing of the meaning of the law; only to obey.

If we are to build a new world, one that is free from the constant transgressions of corrupt states and their allies, we must insist on labeling the slaves for what they are: stupid, weak-willed cowards who would rather have temporary safety, than true liberty.

Forget them and press forward!

Let them stay at their bullshit jobs, where they can ever so happily be paid pennies for their own voluntary enslavement. Let the fools believe their masters of capitalism and the state would ever-so-kindly give them justice; and let them cry tears of shame when they realize the shall never receive it. We have no need for those kind of people to help us build a new and better world.

To Fight the Fascists

Our republic die a sad and quiet death long ago; swept under the rug and ignored by the media and public like all of crimes of the state. We are little more than the aftermath of total liquidation of democracy; the world manifested after the crushing of constitutional rule by weighty corporate hands. From the coast of the Mediterranean, the to the tip of the Arctic circle, and back to the peaks of Patagonia; every nation across the globe has been crippled under the weight of international fascism–the true face of transglobal capitalism. This happened before our generation, are we are the ones that have been left to clean up the travesty of the 20th century, and the bold-faced lies the inept generation before us insist upon being the truth.

Resistance would be nearly-impossible if it were not for the internet, crypto, and bitcoin. Despite the international terrorism that has presented itself under the banner of ‘freedom and democracy for all’ we know the truth for what it is. We need little more than to watch the videos of the aftermath of their drone bombings, extrajudicial killings by police, and politicians who voice their contempt for the very laws that create the throne they sit upon. Their world is slowly and surely slipping away from their grasp of power with each new piece of technology we have. They no longer control our media, communications, or economy–we will move away from them as we build our better world here, preparing to chop off their fat-fingered hands for when they interlope into the land of digital sovereign.

The battle of bitcoin is not for the hearts and minds of the people of the world today, but of the generations of tomorrow. Everyday more of the older generation who are suspicious of the internet are dying off and dwindling in numbers, while droves of brilliant young people from all around the globe find refuge in the internet, away from the tyranny of life as slaves under state capitalism. Great ideas take time to build, as if great rumblings of thunder before the lightning strike of revolution.

The Truth About Bitcoin

The simple matter of the facts is that bitcoin is a both a better payment system, a superior form of money, and the most powerful mode of economic resistance that world has ever seen. Lies, fear-mongering, and doubt all sort themselves out with enough time–and time is on our side. Bitcoin is barely 6 years old, and really only 4 years of that has it had any commercial application. Over the next 4 years the myth of fiat money will show itself for exactly what it is: a myth.

People are pissed off about the general illegalism, corruption, and graft that is the norm for banking and government cultures alike, and frankly there is little that can be done about it. Institutions of justice time and time again have proven themselves to be corrupt to the core, with no interest in defending the rights of the common people, or respect the laws as they stand. Due to the cozy relationships banksters have developed with governments from greasing the palms of politicians, they are given special treatment so they may operate outside of the law with impunity. If we are ever to reestablish the rule of constitutional law over our governments we must demand that people understand that our republic was lost to the very people who take oaths to protect it.

The considerable amount of lies, stupidity, and idiocy spouted by the trolls and detractors will come to bear the truth of their nature over time. Their lies about bitcoin, governments, and the ‘dangers’ of independent money are out in public for everyone to see, and to act as a testament against them in the coming years. Their words will be as bankrupt and hollow as their money; and people will seek for themselves the truth of what bitcoin and digital currencies can do. If people want to discover how to liberate themselves from an economy ran by gangsters in banksuits, and fascist masquerading as politicians, and it is simply a matter of time before they discover that for themselves. As for everyone else; they can keep their chains and I’ll take my liberty.

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Next: Class Consciousness of The Digital Age

The Revolution of Bitcoin Banking

One of the dirty secrets of the bitcoin world is that we are still in the 11th century of online exchange. Today bitcoiners are dealing with the classic issue that plagued humanity since at least the 7th century BC when the first piece of coinage were found. Coins, as all physical objects, are subject to physical theft, confiscation, swindling, fraud, and debauchment; but most of all, outright violence to seize it. These issues continue to this day; however there are apparatuses that as groups of people we can use to defend against such issues: Banks.

The Evolution of Banking

The remains of the London Mithraeum

Banks from their earliest origins have functioned quite autonomously of the state. Developing out of the rise of italian merchant class in Italy during the 11th century, banking evolved far beyond the meager protection of precious metals into financialization. I highly recommend reading Nick Szabo’s two essays, “Origins of the Joint-Stock Company” and “The Birth of Insurance” for an in-depth look how this process occurred.

At this time, lending and banking was not a concern of the Sovereign–He had the power of taxation, and war–this was how he would raise funds if need be. However, war economies don’t work if you are on the losing side, and this is where the english crown found itself at the conclusion of the Nine Year’s War. England had been crippeled by france at the Battle of Beachy Head where the Royal Navy was decimated. William the III could not raise the funds at the time, and so he developed something very, very sneaky: The Bank of England. Of intersting note, this bank was built physically on top of a Roman temple of Mithras–how fitting.

As a private corporation, the BOE was given the sole power to issue bank notes in england on behalf of the crown. This allowed for lenders to give cash bullion to the bank, who could then give a loan based upon a promise of repayment from the Crown in the future. The Crown essentially invented war bonds to raise funds for the transformation of england into the naval superpower it would later become. And this was all thanks to the seditious revolution of banking.

Moving from a coinbased economy as the main mode of exchange, to a reserved-based note system, is what allowed for substantial economic development to occur in England in the generations after. This was specifically due to the technological development of new kinds of financialization which were never used before, which gave england a substantial economic advantage over other states.

Slowly and insidiously this version of banking took over the whole world! Using this system states could create money that did not exist yet; one could spend tomorrow’s promise of repayment today! A revolutionary development, but as we see today, when stretched beyond the limits of the markets, it can, and will create havoc.

Transitioning From a Coinbase Economy

Today in the bitcoin world, were are shuffling about our bitgold forged into coins from the process of bitcoin mining. You can read more about the production process of forging bitcoin in my previous post bitcoin as commodity money for a more detailed explanation of this process. While this does have many, many benefits over contemporary banking, fiat money, and governmental interference in economics; it also has substantial problems–mainly incompetence. From the Gox fiasco, to the most recent Bitstamp compromise, it is the golden age of digital highway robbery, with the Black Barts of the digital age having the time of their lives.

Attempting to move from a coinbase economy to a fractional reserve one does have some appeal, but we all know how problematic, and antithetical this is to bitcoin. However, with the developments going on over at Blockstream, I think there is real hope to create something that will straddle the lines between a coinbased economy, and a fiat economy: transparent reserve banking.

Sidechains and Collateralization

Source: https://www.cryptocoinsnews.com/sidechains-bitcoin-2-0-revolution-highlights-reddit-ama/

The team over at Blockstream has assembled a ‘Manhattan Project’ scale of crypto experts to develop sidechains. The sidechain project is one to essentially be able to create a two-way peg between coins deposited, and the creation of new assets. There are two reason I believe this is such a critical development:

1) Using bitcoins deposited via sidechains a new assets can be created which would be more difficult to steal, and would allow some process of restitution in the case of theft, similar to what banks provide today.

2) Bitcoins can be used as collateral for a unique model of debt-financing as follows:

Bob deposits 10 BTC today with Alice Bank via sidechains. This creates a loan that is a fractional value of the bitcoin he deposited.

Today those 10 BTC are worth around $2700, and once deposited with Alice bank, this will make a loan that is leveraged 1:10. Alice Bank will now give Bob a lump sum of $27,000 to be repaid in the future. In order for bob to recover his 10 BTC, he will need to make payment of $275 each month for 100 months. Bob is free to pay back the the loan + the fixed interest early if he chooses to do so. Once the total of $27,500 is fully repaid Bob will ‘unlock’ his bitcoin from the sidechain. Bob now has his 10 BTC back.

What makes this so revolutionary is that it solves the impossible trinity problem that all central banks face. This allows for a natural equalization of the USD value of bitcoin to occur through debt-financing via bitcoin, fixed in dollars. If the value of bitcoin substantially increases beyond the initial $270 that Bob’s bitcoin is financed at over the next 100 months, he will have all the more motive to repay quicker to get his bitcoin back. If bob defaults, Alice Bank will be able to keep the 10 BTC for itself.

By treating bitcoin as property, a sidechain bank could use a fixed amount of bitcoin as collateral just like a how a home is used as the collateral in banking today.

The Next Generation of Bitcoin

If bitcoin is to advance itself beyond the wild west of digital finance, while remaining true to its core tenets we will need sidechains. This will allow for a revolution that will be similar to the scale and scope of the one William the III ushered in when he created the BOE. This will help bitcoiners resolve some of the security issues that have plagued the coin-based bitcoin economy, but more importantly, it will help financialize the bitcoin economy. By using bitcoin as an assest for debt-financing in fiat values, bitcoin banks will be able to create loans for people, while still remaining free from the hands of the state–if they choose to do so.

As dangerous as this is to flirt with debt financing, I believe that sidechains offer a revolutionary way to financialize the bitcoin economy in a way that allows for those in the bitcoin economy to have their cake and eat it too.

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Next: Bitcoin is Political

Bitcoin is Not About Money

It’s about power

Bitcoiners are part of a new political, economic, and social class. At the core of our tenets is the recognition that bitcoin and digital currencies are powers in themselves, and that they cannot be restricted by the despotic tyranny of States, or their capitalist allies in banking. We are not united by our creed, nationality, or gender, but by our economic objectives and the advancement of our technology. We are the ones that shall force the fiat banks towards their death, and we are the ones that shall make the State capitulate on its monopoly on legal tender and the mode of exchange. It is time for the youth of this world to rise and take their rightful place in history by striking down the awful corrupt governments of the past that have sold us out. No longer do we need to remain subservient to this system of exploitation and alienation.

The Digital Vanguard

There is nothing that ties any of us together–no names, no identities, no bodies–just Bits of data being sent across the Great Commons of the Internet. Together we have created a multi-billion dollar economy from nothing just five years ago. Those who hodl bitcoin are far past the point of doubting the success of bitcoin–we know bitcoin will be successful. We see its power, we see its efficiency, and we see the world that we are to create with it–and governments of the world and their corrupt allies are not part of it.

We are the Vanguard of bitcoin. We are the ones who shall fight the Goliath of Finance and the Leviathan of the State and watch them fall from the pedestal of human they mounted themselves upon. We shall watch them fall, we shall watch them burn, and we will do nothing but stoke the flames. We will do simply laugh and walk away, disengaging them and continuing to build the new economy that is based upon the values and virtues that has been put into the code.

Over the last few years we have poured our hearts, minds, souls, and fortunes into this project. We have made the market, built the applications, and connected the nodes, and militantly worked on security to ensure our success.

Indeed, detractors will do everything they can to discourage us. Even in that very word, we can see their cowardice; to dis-courage. They lack courage; and are spineless, sniveling, fear-dominated people who couldn’t fight anyways. They only see a world of 9-to-5 enslavement as a favor that we should be grateful for. These people cowtow under the unjust laws of their masters; for anything their masters choose, for them becomes law and justice. We refuse to bend our necks to these men: we know the crime against humanity they have purported, and we shall resist them.

Together, united in the cause of building a better money, we shall also build a better world. We have made ourselves nearly invulnerable to the malice of the state, and rage of the banks though ensuring our Privacy. We know from the code that Privacy is our immutable Law; for privacy is what assures us not only our safety, but our equality in dialog as well. We know nothing of the other parties that participate with us, except for the Solidarity we have with one another. Together we are building an economy that is based upon fairness, equality, and individual sovereignty–and we are not asking for permission to do this.

To Build a Free World

We are the ones that have ensured the success of bitcoin, and we have been and shall continue to be rewarded kindly for such loyalty. No one came to us and said, “You need to invest and support this,” In fact, many of us were mocked and called fools for ever believe in it. But onward and upwards we went, making the long journey from the obscure origins of bitcoin to the multi-billion dollar economy it is today. No one told us we would make 5, 10, or 20 times what we originally invested–we did that.

Famous vulgar philosophers, politicians, investors, economist, and journalist from all around the world have insisted that bitcoin would be nothing. They said it couldn’t be a currency, and that it was only used by drug-dealers and pedophiles. Every single step of the way they laughed at us, mocked us, and insulted us…and yet we are still here, growing, building, and pulling more and more into our sphere of influence, and away from theirs with each passing day. So quietly and seditiously, people are coming to understand the nature of money, and realizing that the banks, and the state are using that to keep them oppressed, and divided from our true political goal:

Freedom.

True, unadulterated, messy, complex, Freedom.

Freedom that cannot be suffocated because of the fears of pathetic men who need to terrorize us into compromising this most sacred of rights. Freedom that cannot be taken at the whims of the states, or the cries from banks.

Freedom–despite being so thoroughly abused, manipulated, and contorted by men of power for nefarious deeds–is a word that still has meaning. Words will always seek to give themselves means for what they are and what they represent. The word ‘freedom’ will always sound hollow coming from the mouths of oppressors to justify their despotism, which will also make present the need and demand for what ‘freedom’ truly means.

Tragically, we were birthed into a world where the fascist won long ago, and created a sophisticated oppressive apparatuses of nightmares to terrorize us into giving more and more power to the state, and their allies. This manufactured terrorism from our masters has allow for us as a people–fearful, and trembling–to sacrifice our essential liberties, bastardizing our sacred constitutional rights, proving their worthlessness without the force of men, and the will to protect it behind them.

Bitcoin is not about money

It has never been about money, it’s about freedom and what that means for our society today. As we descend into the panopticon the state is erecting at this very time, preparing the gulags in the deserts, and military control of these states, we declare that we shall not go quietly into that dark night. We declare that a government that is marked by every act which may define a Tyrant, is unfit to be the ruler of a free people. Together we are building the mode of resistance that shall cause for the empire of paper to collapse, which will free everyone from the shackles of debt, and the chains of domination.

We shall no longer be force and intimidate us into playing by the corrupt and hollow laws of the state. We see the men of government, banking, and capitalism for the criminals they are, and for the damage they have done to us. We see how they have betrayed their oath, their nation, and their honor. Their words, and their threats are meaningless to us. We are building a better world that they are not a part of, nor will they be allowed to be a part of. We no longer need them.

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Next: Revolutionary Syndicalism of Bitcoin

The Creative Destruction of Bitcoin

A little more than a year ago I covered bitcoin’s creative destruction, and how bitcoin is more efficient money system on several economic levels. We also explored how the near-zero transaction cost of cryptocurrencies creates a monetary system that shall always be more efficient than fiat monetary systems. It is because of this fact that we shall see bitcoin destroy the contemporary models of finance, banking, and monetary systems; while as the same time building something new, better, and more egalitarian in its place. As the bitcoin ecosystem grows, we will see a radical shift of money, finance, and banking away from huge institutions that are embedded within the capitalist structure, to a decentralized, global framework of economic exchange divorced from the state. Schumpeter described this process of creative destruction in chapter 7 of Capitalism, Socialism, and Democracy and how capitalism incessantly transforms the economic landscape:

“In capitalist reality as distinguished from its textbook picture, it is not that kind of competition [oligopolistic competition] which counts but the competition from the new commodity, the new technology, the new source of supply, the new type of organization (the largest-scale unit of control for instance)—competition which commands a decisive cost or quality advantage and which strikes not at the margins of the profits and the outputs of the existing firms but at their foundations and their very lives.”

Smashing Monopolies with Advanced Technology

The superiority of bitcoin as a money system is something that will be proven in the long-run of decades. What bitcoin has accomplished in 5 years alone is astonishing. As a non-goverment money system, bitcoin is not subject to the same legal system, taxation, inflation, or political pressures that all fiat money systems must experience. Bitcoin explicitly lacks the charlatan features that all fiat money systems–this is a feature, not a bug.

Bitcoin exist outside the framework of sovereignty of the state. Bitcoin cannot derive any legitimacy from laws or enforcement, but only from its own merits as money. In doing this, bitcoin points out how corrupt our current economic and political system is, while creating a totally new form of money that is a radical alternative. Bitcoin points out the corrupt relationship between the state, institutions of money, and how that relationship creates oppression for all people.

Today, the oligopolist and monopolist have won. A small handful of companies control vast swaths of industry with the full cooperation of the state. Government pay huge subsidies to mega-corporations while child homelessness is at an all-time high. Governments use the money they control not to help those in need, but to make illegal wars both domestically and abroad. Politicians are paid off openly and without shame, while the banks readily kick hundred of thousands of people out of their homes and into the streets with the full support of the law. Police openly murder children and are readily acquitted and protected by the legal system.

This is a form of inverted totalitarianism monopolizes the structure of power through omitting any democratic process from the economy system. The monopoly of banking, the monopoly of the law, and the monopoly of the issuance of money have all been forcibly justified through extreme campaigns of fear-mongering around the ‘need for safety’. This has nothing to do with economics, efficiency, or safety–it is about corruption and using the state to create laws that protect incumbent industries and politicians.

Breaking these monopolies is the kind of creative destruction that bitcoin is engages in through applying a superior technology. The restructuring of economic power into a digital realm will not only dramatically redistribute wealth away from the old order, but it will also radically transform the size and breadth of the financial economy by several fold. The financial and banking systems will become much more accessible, the nearly 10 million american adults lacking a bank accounts today, and the 2.5 billion unbanked all over the world can now have a real opportunity at financial access in a way that has never been experience before. Those who build these new systems, and utilize the power of bitcoin to revolutionize the financial and banking industries, will be the champions of this new digital economy.

The Revolution of Accounting

The creative destruction of bitcoin strikes at the very root–the very object of exchange–of the capitalist economic structure: money. It is through the explicit destruction of the current payment systems, legal tenders, and the monopolization of those, that bitcoin will reinvent the entire economic. From destroying these old model of finance, banking, and exchange; the entire infrastructure around economic exchange will be recreated in a better, more effective model. A similar revolution happen around 800 years ago in the north of Italy with ‘discovery’ of double-entry accounting.

This novel approach to accounting allowed for merchants to have a much better understanding of their total assets and liabilities, as opposed to the old version of just keeping a daily diary of what they possessed. The real revolution that came from this accounting system was the way to measure, value, and utilize various assets and liabilities in new ways–equity was birthed into the world. This transformed non-active capital that was previously doing nothing, into doing something. Adam Smith talks at further length about this in The Wealth of Nations:

“It is not by augmenting the capital of the country, but by rendering a greater part of that capital active and productive than would otherwise be so, that the most judicious operations of banking can increase the industry of the country. That part of his capital which a dealer is obliged to keep by him unemployed and in ready money, for answering occasional demands, is so much dead stock, which, so long as it remains in this situation, produces nothing, either to him or to his country. The judicious operations of banking enable him to convert this dead stock into active and productive stock; into materials to work upon; into tools to work with; and into provisions and subsistence to work for; into stock which produces something both to himself and to his country.”

-Adam Smith, The Wealth of Nations

Though this seems to be the most boring possible topic to be revolutionary, it certainly was. With the development the merchant banks in Northern Italy, now there was a way in which the ‘dead stocks’ of stationary capital could be commoditized. From the ability to much more accurately understand one’s own finances through double-entry accounting, there became a whole new way to utilize, and understand money. This was the revolution that helped create finance as we know it today, and is what also propelled the advancement of capitalism to its place on the world stage it is today.

The great advancement that came from double-entry accounting was the novel approach of pooling money through banks, and then being able to utilize that capital as an active, and productive investment, rather than a dead stock. This meant that many, many more people could access capital for investments than there ever had been available before. This new market for capital and mode to utilize it, fundamentally restructured the economic fabric of life in a way that would indelibly change the future, and advance it towards one of capitalism. This was the first revolution of accounting, and now 800 years later, we are having the second revolution of accounting and measurements.

Building The New in The Shell of the Old

The creative destruction embedded within capitalism can best be understood as a dual force of creative power. It seeks to destroy and defile old ways in the quest to create something more efficient, more masterful of the task at hand. The only way that we can build a new and better world, is through first through destroying the old ways. It is only once we have cleansed ourselves of the inefficiencies of the past, that we are able to fully manifest and powerfully produce the changes we wish to see in the world.

Luca Pacioli–remembered for writing down how to do double-entry account. No one knows who that other guy is.

The revolution of bitcoin is not just in destroying these old financial industries; but building the new system that will be radically better than anything we could imagine. In this brave new world we are quickly coming into, the financial industry as we know it will be crushed in order to make way for the new system of finance. Bitcoin and other digital currencies simply have too low of a transaction cost when compared to the transaction cost of any fiat money system.

The development of the triple-entry accounting system of the blockchain has at its core the same praxis and creative destruction that double-entry account had: to destroy the old order of exchange, to make way for the new, better, and more effective system that can reach and serve many more people than the old system ever could. What is so revolutionary about this new mode of economic organization is now the arbitrator of measurements within the system of exchange (bitcoin itself) is subject to the same accounting standards as all other actors within the system–the bankers and politicians cannot cheat this system for their own benefit. The bitcoin ecosystem has no way it can just make up new bitcoins, as the state and banks can do with fiat money, or how they can debauch commodity-monies. The real revolution within bitcoin is that makes the banksters, the financiers, and the state subject to the same economic laws that govern everyone else.

Through eliminating the costly, inefficient, slow, burdensome, and corrupt contemporary system of banking, finance, and money itself; there is a whole new economy world to be created. This will exponential increase the productivity of capital, as it no longer has to be subservient to the state, their regulations, or laws that protect their cronies. Bitcoin ensures there is no longer any physical space that must be defended to protect money, so the infrastructure of this new form of capital can extend well beyond the branches of banks, or physical kiosks. Money no longer has any masters–it is free to create the world it sees fit.

What Must Be Done

We have the tools, now we must build the new system. Rome was not built in a day however, and what we are attempting to do is to fundamentally restructure the most prominent aspect of our society and world today: money and wealth. This is an ideological battle of the greatest kind. We are not just trying to address the economic issues at hand, but the mysticism and magic of how money functions. These are huge political, social, and ethical issues that many people today would rather not question or talk about–they would prefer to simply shove their head in the sand and refuse to believe that this is possible.

However the younger, technologically inclined and technology trusting generations will soon come into power against a political and economic system that has willingly and enthusiastically sold them out, disparaging them each step of the way. Spite and the demand for justice is a very powerful thing, and the true revolution is going to come when the youth from all around the globe realize that they can economic and politically organize themselves against the respective systems that have exploit them. The revolution is already in motion; what remains to be seen is how quickly people are going to be willing to seize it for themselves.

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Next: Hayek’s Promise

Bitcoin is a Commodity Money

We have discussed several different ways in which bitcoin creates an intrinsic value for itself. We also have discussed the absolute value that cryptography offers, and how States conjure up fiat money through legal violence via valor impositus, rather than creating money with real bonitas intrinseca value of metals that are coined. Now that we have an understanding of the above concepts, we can discuss how bitcoin is a commodity money, made from rare unique bits of data that create the whole cohesive framework that makes up bitcoin.

Satoshium

For this post I am going to pretend that bitcoins are real coins that are minted from a new metal called Satoshium. This metal is ugly, has few uses, and cannot be physically touched, as it is invisible–overall it is pretty useless. However this new metal is very, very divisible, malleable and it can be transported over any digital communication channel. All Satoshium that will ever comes into existence is created through the coinbase reward that ‘mints’ bitcoin units, which happens during the process of ‘bitcoin mining’.

The reason for the fictionalizing this alloy Satoshium is several fold:

1) To elaborate on the very important distinction between the legal creation of currency out of nothing, and how that is different from the minting of coins which must gain their value from the material the coins are made from. This is the distinction of legal tender under the force of law (valor impositus) and the nominal value states creates out of thin air (the expansion of the money supply), verses natural (bonitas intrinseca) money, which derives its value from no enforcement, or organization of men; but from the intrinsic use-value the object possess in-itself. This is seen most frequently with precious metals, but also with objects of use value like cigarettes.

2) Bitcoins can be used for much more than just money. When bitcoin units are creatively destroyed (proof-of-burn, colored coins, etc) it is similar to the melting down coins to use the metal for something more useful. Contracts, identity, transparent taxation, autonomous agents, etc. can all be created from Satoshium, or the outright destruction of bitcoin units.

3) Bitcoin is really a several dynamic systems working together (payment, identity, proof-of-existence, ownership, PGP system, etc) each with their own purpose. This is in addition to the fact that ‘bitcoins’–what one could think of as the cassacious coin, and I refer to as ‘bitcoin units’–is separate from owning a bitcoin address with no money in it.

Today we shall cover only the first item, and discuss how the bits of data that create the individual bitcoins have their own unique values that are not found within in the laws of men, but the laws of math.

Satoshium Mining

bitcoin monetary base

Let us think of Satoshium similar to gold or silver, with a few notable exceptions. Satoshium is rarer than gold; with only 2,100 trillion units (0.00000001 BTC–the smallest bitcoin unit, ‘a satoshi’) of Satoshium that can ever exist. Today there are about 1,350 trillion units of Satoshium that have been discovered through the ‘Satoshium mining’ process. More and more people are mining everyday with better, and better mining equipment–which is making it harder for current miners to find the mining reward. We will comeback to how bitcoins are ‘minted’ from satoshium using the coinbase reward process later in this post.

Another unique trait about satoshium is that it has a very, very steady inflation rate. For every 10 minutes of satoshium mining that is done on the bitcoin network (combining all of the mining power that everyone is using to find satoshium–be it 9 computers, or 9 billion) there are 5 billion units of satoshium discovered. After the first 4 years of mining, this amount was reduced by 1/2, to 2.5 billion units for the same 10 minute block of total work by the network. This amount will continue to divide in half every 4 years until there are no more units to be divided, which will be somewhere around 2138. Today there is much less satoshium available for mining than there was even just a few years ago–this is similar to the real deflation that metals, like gold, silver, and platinum experience over time, as they also have a finite supply.

Satoshium mining has become very difficult because so much mining energy is competing for these limited number of bitcoin units; the little guy can no longer mine satoshium on their own–it is simply too hard. This would be like trying to mine for gold with only a pick and shovel, while the guy next to you has a gold mining operation–you are not going to win. To resolve this, people discovered that if they ‘pool’ their work, everyone can share in the reward of satoshium mining based upon how much work they are doing for the bitcoin network.

The Minting of Bit-coins

Satoshium is really the coinbase reward, which is the raw material that bitcoins are minted from (fun fact, the only way you can truly destroy a bitcoin is through not claiming the full coinbase reward). In the same manner that gold is just a hunk of metal before it is minted into a coin; so is satoshium is to bitcoin. When someone is rewarded for satoshium mining, those satoshium units are grouped into chunks of 100 million units and ‘minted’ single bitcoin. This is the coinbase reward process. This ‘mints’ satoshium units into bitcoins based upon what the block reward is at that time, and pays that reward of new coins out to a new bitcoin address. This is the ‘minting’ process and how the bitcoin network creates new bitcoins.

Though each bitcoin is created equally, the data that comprises of each individual bitcoin is unique and different. Each bitcoin addresses has unique identifying properties, that differentiate each individual bitcoin to their owners, but to no one else. This is similar to the serial number that is unique to each dollar bill. This means that the history of that particular bitcoin (or subdivisions of that bitcoin) can be tracked, and can only be spent when the 53-digit unique hexadecimal private key authorizes its movement. If properly secured, it is impossible to ‘hack’ a bitcoin address and take the money from that address; as only the private key will be able to move it. This is why there are several bitcoin addresses that have tens of millions of dollars in them, and not a single one has been hacked.

The mining process is also what ensures that there are no ‘double-spend’ attacks. In lay-terms, a double-spend attack is similar to check-kiting, where one spending the balance in checking account twice before the bank can check to make sure the funds are there. We won’t go into details about this right now, but just be aware that the mining process also acts as the gatekeepers to the transference of funds, and offers mathematical assurance that no coins can be stolen, or double-spent.

The Money Supply of Bitcoin

The reason for us fictionalizing the metal Satoshium is to make clear the distinction between fiat currency that are made from nothing, and commodity money which must derive their value from an object’s intrinsic worth–the value is found in the money itself, not vice-versa. A fiat currency is a scrips certificate of exchange issued from a central bank. The scrip itself (such as a $20 bill) is just worthless paper–there is no bonitas intrinseca about it. An infinite number of these scrips can be created, as their values are created and set by the dollar accounting system controlled by the Third Bank of the United States (also known as The Fed–a misleading term that I hate). Each one of these scrips can be redeemed for goods and services for the nominal value printed on it, because it is legal tender–one must accept fiat money in exchange for goods or services. If not, you will face the wrath of the law.

Historically, once could exchange the nominal value of these worthless papers for a precise measure of commodity money, such as gold or silver. However, fiat currency no longer has any sort of value backing them–since 1973 they have been free-floating. Governments are now free to print as much money as the like, which they are happily doing. This is because there has been a low level currency war going on since 2008, and it is starting to intensify. This means that while there still is a finite, natural supply of all physical objects; there now is twice as much money (in the case of the US) that can purchase those same objects.

This is how governments expand the money supply to create inflation. This bleeds the value of the hard-earned savings of common people, in order to further enrich the current ruling class. All people in all nations are now facing these political calamities that will make us all economic casualties.

Velocity of Money

Velocity of USD

When more units of a currency are injected into circulation, this causes for a total number of units within the system to increase. If the velocity of money were normal today, this would mean that the prices of everything would double over night–but it has not. This is because the velocity of money is at historic lows, at less than 1/2 of what it normally is. This is not a mistake, but a response to the QE of the FED.

Let us compare this to how bitcoins are ‘minted’. Bitcoins derive their value from the bonitas intrinseca, the real economic work that has been preformed in the Satoshium mining process, and the use-value that Satoshium has. Each and ever single bitcoin in existence must have came from a coinbase reward–there is no other way to create bitcoins. In order to create the coinbase reward, real computational work that takes real energy–no different from the energy used to dig gold from the ground–must be preformed.

With Satoshium mining, this ‘work’ is done in the form of solving very, very, very complex mathematic problems that secure the network from ever being corrupted. This gives each bitcoin unit equal, market-based value due to the fact that it cost real-time energy to produce bitcoin today. There is no way to modify the number of bitcoin units that can be created (unlike fiat money), as bitcoins can only come from the coinbase reward, and that is hardcoded into bitcoin. This ensures all bitcoiners that no one can ever just change the supply of bitcoin in the way the US can, or any other central bank can for their currency (I’m looking at you Japan and EU).

Bitcoin as a Currency

Money can be held here and proven that it exist

This is a public bitcoin address. If you have the private key for this address you can control the money there.

For us to understand bitcoin as a currency, let us think of bitcoin paper wallet for the moment. This is a piece of paper that has the private key of a bitcoin address printed on it. When one inputs the private key of that address into a bitcoin client, they can access, and transfer the bitcoin found in that addresses. This is a currency bill in the most fundamental sense of the word; as it is not that piece of paper that has any value, but what it represents. What has value is the private key, as that can access the bitcoin–not the paper itself. The paper has only exchange value, not use-value. This is how banking classically existed for centuries with banking bills representing some value of gold until the 1973, when the dollar dropped its peg to gold.

Although bitcoin is called a digital currency, that is a bit of a misnomer. Bitcoin is not a currency but a commodity-money. Bitcoins must come from the coinbase reward process, and that process can only be done through the electrical labor of mining. Thus, like physical coins, a bitcoin can only be created when the correct ‘bits’ are ‘minted’ into bitcoins. Bitcoins cannot just be created willy-nilly–real computational work must be done, and real energy expended to mint bitcoins.

This is why we have differentiated the creation of bitcoin units from that of Satoshium mining. If we are to mint coins, physical or otherwise, we must have something to mint, we cannot make coins from nothing! And this is the very place that commodity monies are different from fiat money–fiat money does not represent anything other than the law, whereas bitcoins ARE something–very special data sets verified by the bitcoin network.

Bitcoin is a Commodity Money

Bitcoin is a commodity money because the cryptography that bitcoin is built on top of. This has created the contract that limits the supply of bitcoin units and protects the bitcoin payment network. It is cryptography that creates the immutable and fungibility of bitcoin units and the imperium of the bitcoin network. This immutability creates a use-value for bitcoin, which also creates its exchange value. Furthermore, the ‘satoshium’ units of bitcoin can be broken down and used for all sort of other various contractual functions. By understanding bitcoin as a commodity money, we can see the true value that bitcoin has is outside of the legal constructs of the state.

The internet now has money that is loyal to no political body, or statist organizations; but to digital ideals alone. This is not just the economic base of a new epoch, but a political one as well. Bitcoin is the economic praxis that will allow for humans to create a new class consciousness. We can use the internet to help us create a new society, and we can use bitcoin as the economic mode to create that new world.

Bitcoin is not about money, and has nothing to do with money. Bitcoin is about political power, sovereignty, and the freedom of economic exchange. This is in direct and antagonistic relations to any and all states. Bitcoin seeks to destroy the old institutions of political power, and replace them with new digitized, decentralized ones.

Once people start to see and reject the corrupt and worthless scrips of the states, there is going to be a great unraveling unlike anything we have seen before. The crisis will collapse the value of all fiat money to becoming nearly worthless, and the value of cryptocurrencies will explode. There will be chaos, and there will be anarchy–but these are the conditions of creative destruction that we must have in order to rebuild something better in place of this corrupt and wicked system called state capitalism.

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Next: Bitcoin and The History of Money

Bitcoin and The History of Money

To understand Bitcoin, we need to also understand the history of money. This is a long and complex topic that has changed dramatically over the last 400 years, and has a total history of more than 3000 years. In order to understand both money, and bitcoin, we need to understand that there are two distinct functions that money has, that are independent of each other, but both influences money’s value: the payment function of money, and its storage of value function.

Both of these features have important functions for money, but it is important to understand how each one of these affect money differently. I cover this in more detail in what is the intrinsic value of bitcoin, and bitcoin as commodity money.

The best way to think of it is that bitcoin is a threat to both common storage of value; such as precious metals like gold and silver, but it is also a threat to normal fiat money because of the bitcoin payment network. These two features of bitcoin create one type of money that is superior to both precious metals and fiat currencies. To understand why bitcoin works as money, we need to understand the history of money over the last century.

The History of Banking

To understand banking, we need to know what is a mode of exchange, how did it come about, and why it was needed in addition to a storage of value.

A mode of exchange is just that, a mode in which you can engage in the exchange of one good for another. Before modern money, this could be anything that was commonly exchanged, and the value was well understood by the general public. Throughout history, this has been everything including bushels of wheat, tobacco, land, etc. As long as both parties understood the value of what was being exchanged and chose to accept it, it could function as a mode of exchange.

As gold became the common standard for exchange during the mercantilism era, there became substantial risk in carrying large amounts of precious metals. Instead of carrying around a brick of gold, people could carry around notes that were redeemable at banks for the same amount of gold as the note. This is how banking has been practiced for most of its existence. It has only been in the last century that fiat paper money with no convertibility to a commodity has become the norm.

It is substantially important to understand that fiat money came about to represent an actual storage of value to make real payments. The only reason fiat money ever did come about is because it was a technological innovation that was fiat money. To be able to spend the value of gold, but carry it around in a lighter paper form what a huge technological development that fundamentally changed how exchange was preformed. This allowed for people to continue commerce in the same ways as before, but now with their wealth from the threat of theft.

Ironically, the creation of banking notes that can be redeemed for a storage of value also created the needed framework for the current system of fractional reserve banking that all states use today. This created a kind of banking system where banks no longer operated on how much money they have available, but they operate on only a fraction of the total they should have available. Banks use this system to cheat their profits by using the multiplier effect to multiply their profits–and their losses. These losses can become so substantial that it can destroy the entire banking system and economy. This is what happened during the Great Depression, and more recently during the 2008 meltdown.

The Bretton Woods Era

near the end of WWII, the allies came together in secret meeting in Bretton Woods to negotiate how the new global economy would be built. Keynes wanted an International Clearing Union which would use a fair international banking currency based off of trade deficits called the Bancor. This became the official position of the UK when negotiating at the BW conference.

Keynes’ idea was rejected (despite its popularity), and instead the dollar was to replace the international currency unit, which today gives the U.S. a special power in international finance call exorbitant privilege. To do this, $35 was set as the redeemable price for one ounce of gold (almost twice what it was worth when it was seized from U.S. Citizens back in 1933), and what would become the IMF was setup. Keynes understood the huge issues this would create in international monetary system, and offered incredible insight to how this would play out 20 years later.

This system would have worked, if the U.S. was not cheating on their balance of payments. From 1945 to 1971 more and more U.S. dollars started circulating around the globe because the U.S. was importing more than they were exporting–creating a negative balance of payments. In fact, so many dollars were exported like this that the U.S. could not cover all of the outstanding gold that the dollars represented. The French were suspicious of this in the 1960s and started to repatriate their gold, which led to Nixon shock. In 1969, Nixon announced that the dollar was no longer convertible to gold, and created a 10% tariff to protect american industries from the shock of this. $35 was no longer worth an ounce of gold–it was worth nothing.

Nixon Shock

In order to make sure that the dollar did not enter into a death spiral of hyperinflation, Nixon as put in place tariffs, wage freezes, and a fixed exchange rate until he figured out what to do to give the dollar value. In 1973, Henry Kissinger struck a deal with the Saudi King. In exchange for arming and supporting the Saudis and their brutality domestically, they would agree to sell oil in only U.S. Dollars. This created the ‘petrodollar‘ which propped up the value of the dollar now that it was no longer exchangeable. So from 1973 on, the dollar was no longer worth gold, but oil.

Nearly thirty years later we can see the evidence of how decoupling the dollar from gold has shattered faith in the global monetary system and the dollar. This had huge consequences for the purchasing power of the dollar and everyone who used it. Below is a chart of the purchasing power of the dollar since 1970–today the dollar of 1970 can only purchase $0.18 of goods today–it lost more than 4/5th of its purchasing power in just 45 years.

The Theft of The World

Now that money was no longer tied to the actual value of commodities and is free-floating, it became possible for the theft of the productive capacity of not just entire nations, but the world itself through the monopolization of money by state governments. Slowly over decades, inflation simply caused for the slipping purchasing power of not only the dollar, but all fiat currencies. This was done so slowly and deliberately that few could understand what Keynes had warned people of so many years before:

“Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become ‘profiteers,’ who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

–JMK, The Economic Consequences of the Peace (1919)

Today the inflation that we face is not due to new gold being introduced to the fractional-reserve banking system, but from the value of the dollar simply decreasing. Today there are more dollars in the world today than yesterday due to quantitative easing (i.e. making more dollars). The decrease in the purchasing power of the dollar is a direct loss to you and everyone using the dollar; and a direct gain for the government and banks who benefit from the creation of new dollars. We have been told that these are good men, and that they will use monetary policy to create price stability and keeping unemployment low, but the facts show something much different and much more insidious.

Failure of Gold as a Storage of Wealth

Gold has been used as a storage of wealth for millennia because of the total fungible nature of gold. However, what happened from the start of the 20th century, to the end of WWII, was a consolidation of gold in the hands of the State through legal confiscation and violence. By 1973, almost all gold was in the hands of the state through force and theft.

This was done in two distinct ways. There was state-to-state confiscation of gold and precious metals, such as the reparations from WWI and imperialism. This concentrated gold in the global north in the hands of a small number of elite bankers and business magnates. The other way was through the war that governments carried out against the private wealth of their own citizens.

This can be seen throughout the world with the restrictive legislation from states around the globe; such as Executive Order 6102, The Australian Banking Act 1959, and the Indian Gold (Control) Act 1968. Instead of protecting citizens from the tyranny of wealth seizures, holding gold actually made people a target for the state. Through this violent seizure of wealth, governments essentially gained an oligopoly on gold. This allowed for governments and their allies in banking to manipulate the price of gold through holding or dumping; but more importunately, they have rendered gold meaningless as a source of payment and storage of value. Today, almost no one will take your gold or silver as payment, despite the fact it truly is worth more than paper money.

The Need for Protection From The State

It should be obvious that the greatest threat to ones personal wealth is not some foreign or personal aggressor, but the State itself. This puts us in a predicament because the State is the owner of the means of exchange, and the arbitrator of all legality. Through controlling the means of exchange, the State can manipulate the value of the dollar on a large scale for its own benefit (such as quantitative easing or unlimited funding for war), while also being the gatekeeper of the finance system. The greatest issue with this is that even if you find a suitable alternative means of exchange (like bitcoin), the state can still call it illegal, and bring violence to you and your family for not complying.

If one is to control a large portion of wealth, it can only be done with the explicit approval of the State. At any time they can choose to seized you wealth, and you can go to prison. The accumulation of large amounts of wealth becomes impossible without the approval of the State in modern society. If the State does not approve of it, they will call it ‘money laundering’ and treat you as a criminal. This means that it is impossible for someone to be against the state, while still being able to control their wealth. This helps explain why the state is so active in financial oppression against its own citizens, while allowing for out right crimes to be preformed by some of the largest banks in the world, and letting police execute its citizens.

This explicitly displays that the State has the power to stop these criminals today, and yet they choose not to do so. This is because the government is in bed with these organizations. Politicians receive ‘donations‘ from these companies and former CEOs are given elite, secure jobs from the government later down the line in exchange for this. These companies have bought laws and protection for themselves at the direct expense of other citizens through the corruption of the legal, and political system. It should be clear and obvious for all to see: we cannot recover this system of government, economics, and finance, and we must reject the system as a whole.

Now that we have bitcoin, we can actual do that. Once we reject the money of the State, and their crony capitalist bankers, the value of their fiat money will collapse. The State will no longer be able to pay for their wars, bloated salaries, or mechanisms of fear and terrorism. There will be a great unwinding and no one will accept their shitty paper money anymore.

Conclusion

The State over the course of the last hundred years has pulled off one of the greatest stunts ever: getting people to believe that paper is worth more than real commodities. Through the slow theft of gold for paper, people have been robbed of their ability to have independent wealth. Wealth today can only be acquired at the good will of the State because the State monopolizes the legal authority for how you can get money. The State, and their banker allies siphon off as much value as they can from the productive capacity of normal, hard-working people through devaluing fiat money through quantitative easing and interest.

From the end of gold standard in 1933, to all of the usurpation that brought us to where we are today, it should be clear that governments cannot be trusted with our wealth. Bitcoin and digital currencies offers people a chance to have a financial system that does not empower the State, or elite banks, but protection us from them.

Bitcoin is a global payment system, and storage of wealth that allows for a new system of finance and economics to be built. One based upon the principals of mathematics, privacy, and provability. A new system where we are not punished for saving and protecting our wealth, but rewarded. A system that understands, respects, and protects people’s right to privacy, and their right to conduct commerce with anyone in the world, no matter what State has their bootheel on their back, demanding a portion of their wealth.

Change is coming, and it will be radical, and it will change the world for the better.

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Next: The Absolute Value of Crypto

Menu

Politics and Economics are Inseparable

Beyond The Spectacle

The New Way Forward

No Gods of Government, No Masters of Money.

Revolution!

To Create a Revolutionary Future

To Smash the Chains

To Break a Monetary System

Non-violent, direct economic action

International Money for All

International Direct Economic Action

Revolutionary Syndicalism

A Breif History of Anarcho-Syndicalism

The Digital Federation

The Antifragile Nature of Bitcoin

The Evolution of the Bitcoin Ecosystem

Bitcoin’s People Problem

A Confederacy of Dunces

To Fight the Fascists

The Truth About Bitcoin

The Evolution of Banking

Transitioning From a Coinbase Economy

Sidechains and Collateralization

The Next Generation of Bitcoin

It’s about power

To Build a Free World

Bitcoin is not about money

Smashing Monopolies with Advanced Technology

The Revolution of Accounting

Building The New in The Shell of the Old

What Must Be Done

Satoshium

Satoshium Mining

The Minting of Bit-coins

The Money Supply of Bitcoin

Velocity of Money

Bitcoin as a Currency

Bitcoin is a Commodity Money

The History of Banking

The Bretton Woods Era

Nixon Shock

The Theft of The World

Failure of Gold as a Storage of Wealth

The Need for Protection From The State

Conclusion