Welcome to the CoinDesk Weekly Review 9th August 2013 — a regular look at the hottest, most controversial and thought-provoking events in the world of digital currency through the eyes of skepticism and wonder. Your host … John Law
Become famous in a fortnight!
The summer doldrums are well under way, with the world and its non-gender-specific partner fleeing the office for a fortnight on the beach. In the days before the Internet expanded it to a 365-days-a-way festival, journalists used to call August the silly season. With no real news about, desperate editors turned to a run of non-stories, usually involving vicars, starlets or other animals, while waiting for politicians, businessmen and bank robbers to come back from their hols.
Bloomberg, being a very traditional media outlet, still celebrates this ancient festival. This week, it chose to mark a chunklet of real bitcoin news – a judge deciding that BTC was real enough to be called money – as proof that the currency is doomed. The argument went something like this: bitcoin’s only reason to exist is that it’s different to everything else. If it’s defined as proper money, then the magic goes away and it’s got no advantages over what’s gone before.
John Law is much taken with such thinking, and would like to take this illustrative example to help you become a Certified Bitcoin Pundit. Earn big money at home! Become famous on the conference circuit! Write a best-selling book (which is forgotten seconds later)!
All you need do is decide whether you’re for BTC or against it. If you can’t make your mind up, flip a (non-virtual) coin. It doesn’t matter what your stance is, providing it’s consistent – once famous, you can flip your opinion every other week, but it’s best to start on the nursery slopes.
Chosen a heart-felt conviction? Good. Here’s how to turn it into fame and fortune, with three worked examples.
1. A regulator pronounces that bitcoin is a proper currency, and will be treated accordingly.
For BTC: This is exciting news that validates the technology! This means that it really does have consistent value and a place in finance, while retaining its unique attributes of flexibility, anonymity and non-mediated transfer. Its future is assured.
Anti-BTC: A death blow! Everything you might love about cryptocurrency is lost, as the great mechanisms of official money control are brought to bear on the fledgling idea. Nobody will be able to shift so much as a bitcent without being taxed, regulated, inspected and complied. Stick to dollars, fool.
2. A major scam is uncovered and the miscreant dragged away by the Feds.
For: Exciting news that validates the technology! All new discoveries of worth spawn an initial phase of over-excitement and hype, when the mere attachment of the idea to something renders it far more appealing to the credulous (see: radium health drinks, commercial television, digital watches). It’s only when a new idea completely fails to inspire over-reach (3D TV, Sinclair C5, vat-grown beef burgers) that you know it’s a flop. This is a regrettable but healthy demonstration of vitality.
Against: A death blow! BTC is nothing but a bunch of chancers and swivel-eyed libertarians fishing in a sea of idiots with the worm of deceit. How anyone can take it seriously when this sort of thing goes on is beyond me. What next, bitcoin cures cancer? (Note use of ridicule when facts not available).
3. A new cryptocurrency suffers a security problem and shudders to a halt.
For: Exciting news that validates the technology! Let a thousand flowers bloom – evolution says that some will die so that others may live. The idea of decentralised currency is so correct, and the tools to make it so available, that perhaps some will dabble without thinking it through. Let them, and accept that the furnace of interest will purify the slag of incoherence into the puissant steel of the new industrial revolution! (Note use of flowery language and simile to cover lack of intellectual rigour in argument).
Against: A death blow! The whole area of cryptocurrency is infested with inventors who are either incompetent or incomprehensible. Nobody truly understands this stuff but the hackers, and they’re out to get you. No thinking person will give this nonsense a second thought.
There you go. A new career awaits and you have a couple of weeks before the silly season is over. Homework will be set later.
Slush fund
Growing beef burgers in vats is very science fiction. The idea goes back to the 19th century, although one of the best books featuring it is 1952’s The Space Merchants, a pungent satire of big business and advertising that holds up well even today. But it’s not the most famous SF foodie riff: that would be Soylent Green. In an overpopulated world, a mixture of soya and lentils is the only way mankind can feed itself – only, of course, it’s really made from the most plentiful protein source on the planet: humans.
Bitcoin has plenty of science-fiction chops too: real money that doesn’t exist except as a pattern of ones and zeros, generated and controlled by a global robotic mind that lives in the incomprehensible Internet. So it makes total sense to combine the real-life Soylent – an artificial gloop designed to be a complete nutritional substitute for all other food – and the cryptocurrency of choice. Now, you can buy the one with the other. Is it possible to live a more 21st century life than eating quasi-food bought with BTC you mined yourself with the latest ASIC? No, it isn’t.
However, a word of warning. Although John Law cannot speak about the long-term consequences of such a diet, he does know of one serious drawback. A friend, fired by curiosity, misplaced geekiness and youth, decided to live on the stuff for a while. This being 2013, he published a day-by-day account of the experiment, so all his friends (and everyone he came into contact with in his professional life) knew he was guzzling the gruesome brew.
On meeting said friend for the first time after his conspicuous consumption, the obvious question came out: how was it, and what were the, er, end results he hadn’t written about?
“You mean my poo, don’t you?” said the friend. “The poo was horrible. But not as horrible as the fact that despite me working at the cutting edge of technology, finding out about the latest big computing technologies and assiduously cultivating the digital future, for the past month all anyone has wanted to talk about has been my poo. All. Anyone. Asks. Is. Poo.”
His eyes blazed. The veins in his neck throbbed. Tiny shudders convulsed his body. The subject was swiftly changed.
This may be a sign of some latent psychosis, perhaps triggered by unforeseen effects of the diet. Also, to be fair, the conversation came up at the end of a long night spent absorbing other liquid nutrients. But John Law recommends, should you be tempted, that you prepare yourself to talk an awful lot of excrement.
Pi eyed by bitcoin fan
Finally, another marriage made in heaven – this time between bitcoin and the Raspberry Pi. If you’ve somehow missed this phenomenon, then it’s time to hand in your geek credentials: a tiny £30 computer designed to bring proper programming back to the masses, this Cambridge-sourced wonder has been a true phenomenon, spawning a hyperactive and ultra-inventive fan club.
Raspberry Pi is small, cheap and powerful enough to make itself the obvious hub for almost any esoteric computing and control application. In this case – literally – a hacker by the name of Garbage put a 4G modem and some electromechanical gubbins in a briefcase and offered passers-by at the Defcon security conference the ability to turn their pocket change into bitcoin. The output was a printed QR code that could be scanned in later, when the punters had set up a wallet. The overall intention was to make people aware of, and part of, bitcoin, at no possible risk and for the tiniest possible investment.
So: your exercise for the week is to write a think piece explaining why this is either Exciting News That Validates The Technology! or A Death Blow! Something to do when you’re bored with the beach or stuck in the queue at immigration. John Law is off for a couple of days R&R himself, but will leave you with one final thought: the true Master Pundit is he who can get other people to provide all the material for him.
Get cracking!
John Law is an 18th century Scottish entrepreneur, financial engineer and gambler. Having reformed the French economy, invented paper currency, state banks, the Mississippi Bubble and other ideas essential to modern economics, he took three hundred years off in a small cottage outside Bude. He has returned to write for CoinDesk on the foibles of digital currency.
Image source: jan kranendonk / Shutterstock.com
In-post image credit: Flickr