I. Introduction
Bitcoin is an expression of discontent. If we are to believe the official narrative of the movement, the people have united in a great attempt to thwart the Powers That Be from meddling with the value of money, whether through the Feds printing it or the banks creating it. The more money they put into the system, the less the money we have in our bank accounts is worth. As money is supposed to be a measure of one’s labor and benefit shown to his community, devaluing it is akin to theft. Bitcoin beats the robbers.
For those unfamiliar with Bitcoin, it is a digital monetary system which exists as entries in an electronic database called a “blockchain.” Bitcoin isn’t a commodity: you cannot consume or use it in any industrial process. It is an abstraction which has no tether to any real economic good. In this regard, Bitcoin is no different than fiat currency—the worthless money the state and banks create. But there are important distinctions.
Fiat currency is backed, not just by the opinions of others, but by the state military and the tax system. The state’s monopoly on violence convinces us that its money is valuable and the need to pay taxes in the state’s money encourages us to deal and trade in the money among ourselves. As Paul Krugman put it: “Fiat currencies have underlying value because men with guns say they do.” As negative as that statement may sound, it does give the fiat monetary system some stability. Bitcoin does not have this same incentive structure. It is a non-political, non-state, privately issued currency, and thus its value is extremely volatile.
Those reservations aside, there are certain benefits of this private currency. According to the official narrative, there is a fixed limit to the number of Bitcoins that can exist: 21 million units. In order to obtain one of these digital tokens, you’ll either need to pay someone for it (today the going rate is ~$40,000), exchange a good or service for it (but you will have to wait an hour or so for the Bitcoin blockchain to process the transaction), or mine it. “Mining” means to solve mathematical puzzles with a computer. One can do this by searching all the various permutations within the blockchain database for a 64-digit (hexadecimal) [1] number, with the first to solve the equation gaining a reward of Bitcoins. [2] The Bitcoin algorithm adjusts to the speed at which puzzles are being solved, making each subsequent puzzle either more or less difficult.
Since 2009, when Bitcoin was invented by the pseudonymous and mysterious Satoshi Nakamoto, the computational equipment and energy required to mine Bitcoins has grown exponentially. As of now, according to the Cambridge Bitcoin Electricity Consumption Index, worldwide Bitcoin mining uses about 121 terawatts of electricity per year—that’s more energy than the country of Argentina uses annually. And one Bitcoin transaction (a purchase, a sale, or a transfer recorded on the blockchain) consumes the energy an average American household uses over 24 days.
Once you have a Bitcoin, you can either sell it to someone else or transfer it to another individual with a Bitcoin wallet. Because there is no central authority managing Bitcoin, the blockchain is an open ledger—anyone anywhere can see and validate the transactions that you complete and the record keeping is held universally on various computers across the world. Since the database is held on so many decentralised computers, it is thought to be impossible to hack the system, but this is uncertain.
II. The New Idolization of Mammon
No doubt this new concept of money gives people hope. Our work, represented in Bitcoin, will not be exploited by Central Banks changing the worth of the currency through endless printing or by banks creating money ex nihilo! Because Bitcoin cannot be increased beyond 21 million units, inflation—so they say—will be impossible. Our labor will be represented by this currency in a way that the state’s money could never be.
As a result of this hope, some people consider it a moral imperative to move from state money to Bitcoin. Consider this passage from the book, Thank God for Bitcoin: The Creation, Corruption and Redemption of Money: “In a fractional reserve system, every new loan adds to the inflated money supply, so churches that borrow are expanding the money supply and stealing value from the community. Besides the theft from the community, the church is saddling future members with debt.” [3] The authors put the moral hammer down: “If churches do not acknowledge the immorality of debt-based systems of money, then they will ultimately participate in them.” [4]
These authors are not alone. Many different groups have called this currency not just an alternative system, but a necessary evolution. Often it is likened to the Reformation, which protested the morally repugnant Catholic Church who used its power to steal from the honest man through indulgences. Consider this report by Adamant Research entitled, “The Bitcoin Reformation”:
In the 16th century, the principal doctrine of the Lutheran Reformation was summarized with the words Sola Fide which translates to “faith alone.” This phrase encapsulated the idea that for access to heaven, believers didn’t need a priest anymore. Their faith and devotion alone would suffice. Another common call of the Reformation was Sola Scriptura, or “by scripture alone,” which signified the rejection of any original infallible authority other than the Bible.
In the bitcoin space today, there are several “battle cries” that tend to be dismissed as memes. In our view, they reflect a rebellious essence that could herald a modern-day reformation. A first is Vires in Numeris, which stands for “strength in numbers.” The spirit of this crede was summarized by Tyler Winklevoss in an often quoted line: “We have elected to put our money and faith in a mathematical framework that is free of politics and human error.”
This new system is intertwined with a new faith—a faith that clearly trespasses beyond state and money and into metaphysics. Rather than forcing people to adopt Bitcoin through taxing power or a monopoly on violence as the state does with fiat money, the Bitcoin movement goes after people’s souls.
But it seems that Tyler Winklevoss, one of the twins that first created Facebook and one of the high priests of the Bitcoin movement, needs some help with Metaphysics 101. St. Thomas teaches that all natural things are limited by their form—which is the source of an object’s nature. He writes: “a thing’s being is received and contracted to a determinate nature.” [5] This nature is bounded by time, magnitude, and use. It is limited—and for a purpose. This was an intentional design by God: “Everything created is comprehended under some clear intention of the Creator.” [6] Anything that slips away from bounded nature by means of what Thomas called an abstract realm of mathematics, comes into immediate question. [7] Insofar as mathematics abstractly represents natural reality, it is a sign. But if it is not revealing something about the material world, then what is it directing to? Can it be trusted if it is not built for an obvious purpose? In the case of Bitcoin, it is supposed to represent our work but is fundamentally and totally separated from human life, as Winklevoss proclaims. The article of faith is a contradiction disguised as a great spiritual promise.
The Bitcoin movement is loaded with religious language and metaphysical conjecture. This is a serious predicament that violates the tradition of metaphysics, both inside and outside the Church. A proponent of Bitcoin may retort— “that’s just FUD [Fear, Uncertainty, and Doubt]”. He might argue that we should focus on the facts on the ground and the incredible success that Bitcoin has achieved, despite serious government resistance. While this is impressive, the issue remains. The Bitcoin movement has specifically chosen to construct its articles of faith around Christian liturgies to help inspire people to join their Reformation. Indeed one of the top Bitcoin thinkers today, Allen Farrington, speaks about the development of Bitcoin as the construction of a Cathedral, a new house of worship where people can practice true religion. And they have begun to welcome neophytes, ready to change their lives and find the help they need in the cryptocurrency, through “Bitcoin Baptisms.” They now have Sunday services for Bitcoin, “Satoshi Services”, in which they sing hymns, make chants (such as “HODLujah”), and offer prayers such as, “Hail Satoshi, full of grace, the code is with thee. Blessed art thou amongst nodes, and blessed is the blocked reward, Bitcoin. Holy Satoshi, mother of Bitcoin, pray for us coiners now and at the hour of our genesis.”
Even in modernity, the people who recognize the ills of the State have founded a new Cult to Mammon (at least half of which is trolling), placing their source of security in the idol of Bitcoin. A major theme advanced by the Editors of New Polity is that theology and economics are absolutely intertwined—to be able to see the connection between the two, we will first have to look at economics. Here, it is fitting (if not somewhat perverse) that the first sovereign nation to adopt Bitcoin as its formal currency is named after our Savior.
III. El Salvador
Last Tuesday, Bitcoin became Legal Tender in El Salvador. Their president, Nayib Bukele, announced a couple days before that all debts, all purchases, all taxes and tithes could be given in Bitcoin. And all merchants are now legally required to accept Bitcoin.
El Salvador is not an advanced financial nation; it has had trouble maintaining a stable currency and around 70% of the nation do not have bank accounts. They believe that the stability of Bitcoin, and its accessibility for the unbanked, will boost the national economy and help the country’s most impoverished citizens.
Because the state has decided to adopt a currency that it has no ability to create, it must motivate an influx of Bitcoins into its economy, otherwise the adoption of the currency will be left to the initiative of its citizens. This would be possible if El Salvador were a wealthy nation with some kind of commodity or technological surplus to export. But El Salvador is an extremely poor nation with a budget deficit of 3.05%, a trade deficit of $6.07 billion, and one of the lowest GDPs in the world ($27.02 billion). Moreover, there are only 2.2 million unmined Bitcoins left, and, as discussed, the energy required to mine new coins is immense. President Bukele’s plan to address this conundrum is radical. In an announcement made on June 9, Bukele instructed the engineers of a state-owned energy company to dig a new well into the base of El Salvador’s volcanoes. By day-end, the well was already dug.
No doubt the volcano has a long life—hundreds of years, perhaps—but the upfront costs of producing geothermal energy are significantly higher than other forms of renewable energy, such as solar, wind, and water. Beyond this, the costs to drill new wells, on the taxpayers’ dime, must be measured against the opportunity costs of using that energy in other productive ways. Vanessa Interiano, a senior advisor of the International Renewable Energy Agency, observed in 2017: “It has been estimated that El Salvador still has over 600 megawatts of untapped geothermal resources, that if utilised, could expand and enhance the clean energy share of the country’s energy matrix.”
The well that was drilled this past week, according to President Bukele’s tweet, “will provide approximately 95MW of 100% clean, 0 emissions geothermal energy from our volcanos.” Thus, according to Interiano’s evaluation, 16% of the potential amount of geothermal capacity within El Salvador’s volcanoes, in one unilateral decision, will be used to mine Bitcoin.
While El Salvador is suffering from power shortages, importing 25% of its total electricity, a decision to use its natural resources for mining Bitcoin seems questionable, at best. “Nearly half of Salvadoran firms say that the high cost of electricity is one of the biggest barriers to growth because it increases the prices of products and services,” says the World Bank Group.
Bukele did not listen to these organizations, moving with haste and apparently on behalf of the Salvadoran people. Bukele’s strong-fistedness is a theme in his presidency. He sacked the entire constitutional court and attorney general shortly after taking office. In 2019, “there were three separate branches of government” in El Salvador, says Geoff Thale, president of the Washington Office on Latin America, “Now there’s one.” This certainly does not breed confidence in the president who promises to empower people through this superior monetary system and who rushed to mortgage that people’s most important economic resource. One may say that the congress had to pass the law and thus the people were “involved” in the decision. But the congress has been shackled during Bukele’s regime, even commanding the army to occupy the legislature at one point. On that occasion, Bukele invoked a prophetic voice in stating he only spared that branch of government because God had told him to do so. The people seem willing to go along with their leader, as recent polls suggest. But that does not mean they aren’t being misled by a tyrant.
There are two further considerations: Firstly, finite natural goods are being used up on artificial goods. As we have already noted, Bitcoin is nothing more than an abstract system of accounting. Thus, a real economic and societal resource belonging to the people of El Salvador (the volcano) is being claimed by the state and traded away for the sake of supporting and maintaining abstract financial instruments. This makes little sense for a country that suffers from power shortages. Why use energy resources for anything other than real economic activity, which money should measure and reward, rather than compete against?
Secondly, the only way it is possible for an average Salvadoran to obtain Bitcoin is to trade their goods and services for it. In other words, the people of El Salvador will have to cooperate with a monetary system that has already inflated (from $100 to $40,000) under the tutelage of the world’s (non Salvadoran) elites. They are coming late into the game and being prodded to part with their labour and goods for a currency overwhelmingly owned by a handful of billionaires.
It should not then come as a surprise that Bitcoin was introduced to the country by the advice of Bitcoin Billionaires who have been funding proselytizing missions to the country for the past few years. This newfound bromance between western technology elites and El Salvador is not the philanthropic gesture that the elites would have us believe. If anything, it smacks of colonialism. Here’s why…
IV. The Regressive Distribution of Bitcoin
According to BitInfoCharts, 95% of all Bitcoins are held by 2% of the Bitcoin wallets on the blockchain. True, 2% of wallets that hold the 95% of all Bitcoins are “omnibus” wallets—wallets owned by multiple people. This would imply that the distribution of Bitcoin is greater than what BitInfoCharts suggest. The wallets could be owned by collective entities—public or private companies, state-investment accounts, ETFs—all sorts of things. That said, and no matter how you massage the figures, there is someone that controls the investments of those wallets, and thus 95% of all mined Bitcoins are controlled by a small number of people or private entities. Additionally, according to Bitcoin Treasuries, a couple dozen known companies, ETFs, and states that own Bitcoin only amount to 6.769% of all mined coins—but this number is rising. While we do not have all the numbers to make a definitive conclusion, it is safe to say that very few individuals own the lion’s share of this new currency. For instance, it’s widely believed that Satoshi Nakamoto, whoever he is, alone holds 1.1 million BTC units, which is 5.2% of the total number of potential Bitcoins that can be issued.
Until this point, these early investors, primarily western elites from Wall Street and Silicon Valley, have sought to benefit from the inflation of fiat currencies stemming from government stimulus programs that addressed the global financial crisis, and then more recently the Covid-19 pandemic. Their actions resulted in tremendous gain, disconnected from actual inflation of the monetary stock.
This type of “buy low, sell high” scheme is condemned by the Catholic tradition as blatantly unjust [8]. We see its effects in the fact that Bitcoin investments have produced the fastest wealth inequality in history. Those that got into Bitcoin at the beginning, who had the knowledge and foresight to do so, have a large fortune; those getting in now are set back disproportionately. The first investors’ fortunes are not representative of the good they contributed to society. It was nothing but wealth without labor and money without value-add. In a sense, they will be able to spend money they did not work for, and thus do not deserve. When they spend it, they functionally receive free goods and labor.
Illusory industries like these could be deleted from our economy and everything would run just fine—food would be on the table, houses would be built, and shoes would be made. The economic concept of money as a privately owned service runs contrary to the interest of local communities and increases centralized dependence on the internet and the power structure by making them an intermediary in the pursuit of the natural goods necessary for life. In other words, Bitcoin appears to lead to the same problem it has attempted to solve: the elites are becoming more elite while the labor of the poor is not properly represented in their scarce Bitcoins.
Now the Bitcoin Billionaires have a new technique: they are going to sell their coins to the fishermen of El Salvador. They’ll sell them, the fishermen will start trading with them, society will find a stasis—what’s wrong with that? The problem is one of power. Ricardian Rent Theory describes the phenomenon in which the farmer with the most productive land is able to set the rental price for that land, affecting the price at which farmers with worse land can rent their own. Whether it is renting the asset or selling it, those with the lion’s share of a finite resource or asset set the price. In our opinion, the same holds true for Bitcoin: the majority holders have a type of monopoly power over the price base, allowing them to extract a rent from the non-majority owners. What makes this even more problematic in the case of Bitcoin is that it is an entirely abstract mathematical unit, which can be fractionalized to absurd degrees that houses and fields cannot. This implies that the Bitcoin Billionaires can hold onto their majority share for a very long time while parceling out only limited amounts to minority participants—something akin to a liberalized feudalism. For instance, a Satoshi is the smallest unit of a Bitcoin, equivalent to 100 millionth of a Bitcoin. The proud owner of a Bitcoin could sell a million Satoshis and still have 99 million of them left. Bitcoin remains an elitist enterprise.
With an inflated value of nearly $1 trillion from Bitcoin, the elite, through statecraft, are beginning to trade their abstract “goods” for critical economic infrastructure, real goods, and natural resources. Remember the evil Wall Street corporate raiders of the 1980s? Investors artificially increased the value of companies before liquidating them and spending the money on real goods. This was a classic form of usury—creating an artificial system so as to take over natural ones. The elites always know that the most vital economic resources are in real goods and it is ultimately real goods and real resources they are after. This is why Bill Gates has ensured that he is the largest private owner of farmland in America. But the Bitcoin Billionaires are far more ambitious than the corporate raiders or even Bill Gates. They are turning to actual countries, spending their unearned value on the country’s people who do not know better, and, in the meantime, squandering their societal resources to support their unsustainable ponzi scheme. John Valis, in a recent Bitcoin Roundtable, warned us that this vector to gain power and monetise their scheme was firmly on the radar of the Bitcoin community:
There [are] island nations that have a GDP of $500 million to $5 billion all throughout the Caribbean and elsewhere… I know it sounds extreme but when are we just going to establish a sovereign state; you know, go somewhere, kind of co-op the political apparatus, rewrite the constitution, do whatever needs to be done to plant a flag for freedom?[9]
Rather than free the world from central banks, the Bitcoin Billionaires, with their pseudo-religious movement, are just cold-hearted opportunists. If they disagree, we implore these billionaires to announce a free giveaway of all their Bitcoins to the citizens of El Salvador. The purpose of Bitcoin, so the narrative goes, is to create a just currency, not to get rich. Giving it away would ensure that the Bitcoin Billionaires would not take advantage of their majority share of the currency. They could then compete for the currency on an even playing field by seeing if they could convince the Salvadoran fisherman to trade his billions of dollars worth of Bitcoin for a service or good which the billionaires produce. After all, aren’t these capitalists after free, productive competition?
We should not be surprised by any of this. Power is not based upon who is in office but on those who influence others. Money, in whatever form it is, is a potential, it is power. By means of everyone desiring it, a person can use money to exercise his creative will in the world without breaking a sweat. It gives him divine-like capabilities, which is why the ancients considered their kings—who were also the sources of state currency—to be gods.[10] In fact, the Greeks and the Romans knew that the rich laymen, who were not formally part of the government, were a constant threat to their temple-states. By spending their wealth on the masses, the rich could reorient their allegiances. Hence the Greeks limited the wealthy in creating warships as well as festivals to a strict number of times in their lives.[11] Likewise, the Romans limited the number of times a rich man would create a festival in his region, as well as the amount that he could spend on them.[12]
In our contemporary situation, the wealthy seldom utilize extravagant expenses to win the praise of the masses—but they do spend that money on politicians. As Bitcoin Billionaire Max Keiser recently said: “Do you know that with the Bitcoin I have, I can buy any freaking senator or congressman I want—I make the laws. He who has the Bitcoin makes the laws… we’re not going to just sit around and let the **** congressmen tell us what to do. We’ve got the capital, we make the laws.”
There is no question that Bitcoin advocates everywhere have a genuine discontent with the State. But they are foolish for erecting another man-made system to serve as the solution to the real problems many of us have diagnosed. Their new idol to Mammon will only further enslave the weaker population, like all idols do.
V. Crypto-idolatry, A concluding commentary by Marc Barnes
Idols are strange things. We tend to think of them as magical totems; little statues, enshrined in a temple, responding, in some way or another, to the sacrifices and petitions of worshippers. And while this serves as a starting point, the Scriptures have much more to say about these things, and so much more to say about cryptocurrencies.
Idols are mechanisms by which some people are able to accrue real goods by inspiring other people to sacrifice—that is, to separate themselves from some real good that they own. When the Hebrew prophets critique idolatry, they do so in economic terms, describing idols as “worthless” and as “things that do not profit” (Jeremiah 2:8). One does not get a good exchange from sacrifice. In fact, the sacrifices of the idol-worshippers accrue in the hands of others.
In the book of Daniel, those who give their sacrifices to the god Bel believe he is a living god, because he appears to really eat: “every day they spent on it twelve bushels of fine flour and forty sheep and fifty gallons of wine,” (Daniel 14:3)—a stunning amount of real, tangible wealth. The prophet Daniel reveals what we, under the influence of the Scriptures, have come to expect: the temple of Bel had a trapdoor through which a group of priests would enter at night, taking the wealth for themselves. The idol, then, masks the transfer of real goods from one class of people to another with a work of illusion, usually in and through the promise of abstract, intangible goods, as the Book of Wisdom describes: “For health he appeals to a thing that is weak; for life he prays to a thing that is dead; for aid he entreats a thing that is utterly inexperienced; for a prosperous journey...for money-making, work and success with his hands…” (Wisdom of Solomon 13:17–19).
The nature of this illusion is revealed both in the physical and psychological construction of the idol. The Israelite people, to build the infamous Golden Calf, must give up their familial wealth: “the people took off their rings of gold… and brought them to Aaron. And he received the gold at their hand, and fashioned it with a graving tool, and made a molten calf; and then said ‘These are your gods, O Israel…’” (Exodus 32:3–4). This dispossession of personal wealth for the production of an idol is a standard ritual, as in the same idolatrous activity of Gideon, who constructs an ephod out of every man’s war-spoils (Judges 8:22–28).
The idol is always a confiscation of distributed power and familial wealth. It appears efficacious, not by any natural characteristic, for it is “overlaid with gold and silver, and there is no breath at all in it” (Habbakuk 2:19). Rather, it only ever appears relatively efficacious—by confiscating the ownership of families, the idol (and so those who operate it) appear that much more powerful by comparison. By offering up their real wealth, goods, time, to “things which do not profit,” an idolatrous people participate in a collective weakening; a loss of distributed wealth and power which allows relatively larger amassments of wealth and power to appear as mysteriously “other” than the rest of the (weakened) society. This “weakened state” is achieved in both the construction of the idol, and by regular sacrifices, tithes, and ritual oblations which maintain and feed the god.
Most practically, however, the state in which the idol appears efficacious is achieved by the slavery that follows from disposession. The Israelites, fearing military defeat, ask for an idolatrous king, one who appears divine like the kings of the nations that surrounded them. The prophet Samuel argues that this appearance of divinity in the king is nothing more than the collective dispossession of the people. A king is “mortal, like all men” (Wisdom 7:1), no more divine than the idols that he builds, but he may appear unlike other men by reducing all other men to an impoverished status. As Samuel puts it: “He will take the best of your fields and vineyards and olive orchards… He will take a tenth of your grain… He will take your menservants and maidservants, and the best of your cattle and your donkeys and put them to work. He will take a tenth of your flocks, and you shall be his slaves” (1 Samuel 8:10–18). Men only ever appear divine by the dispossessed because he has seized their goods and used them to do things only able to be done with that amount of resources, usually, if the Scriptures are correct, for works of war.
To imagine otherwise—that these particular men, and these particular statues, actually have access to an otherworldly source of power—is simply to begin the process of living within an idolatrous state. This is why the prophets made “ignorance” a prerequisite of idolatry, a state in which “every man is stupid and without knowledge” (Jeremiah 10:14). The believability of the idols is compounded over time, because the more a people are dispossessed of wealth and power, the more they really do need aid and succor in order to live, and so the more the idol, which promises both, and even appears to give it, (via the redistribution of sacrificial wealth by the person, or the class, that receives it) becomes a social necessity.
Bitcoin, like all fiat currency, has the marks of an idol. But it is an idol perceived by a people who, through the historical influence of the Scriptures, reject the ancient naivety that believes human mechanism to be divine. Moderns are much more likely to live in a state of practical idolatry, in which we know that all apparently superhuman power is in fact just a mechanism combining collective wealth and resources but act as if a particular technology simply achieves goods for us with its own, superhuman power: clicking here and getting what we need, with no further thought to the specific sacrifices of money, energy-consumption, time, and attention by which our clicking is made efficacious.
Bitcoin is no exception. It has the fundamental problems associated with the idol. It is a mechanism that appears to provide goods for all, but in fact accumulates wealth unto the few who have created and maintained it. It is a mechanism that appears to produce solid, dependable goods that exist apart from the whims of others—one can have a Bitcoin, after all—but in fact, the value of Bitcoin and the capacity to own it is still held firmly in the hands of an elite, and especially the elite who constructed it. The Bible understands this rather simply, asking, “What profit is an idol when its maker has shaped it?” (Habakkuk 2:18), a question we might update by asking, “What profit is Bitcoin when its makers and early investors have shaped it to get wealthy?”
Like the idol, Bitcoin operates through sacrifice: it siphons real goods (like geothermal energy, time, and attention) into the service of the acquisition of an abstract power, namely, money. The idolatrous resonances of a national sacrifice carried out upon a volcano is fun, but not the point: Like all idol-worship, the sacrifice of real goods is deliberately detached from any definite exchange. What is granted to those who make the sacrifice is access to the system. El Savadoreans are not to give up their natural resources for anything definite. The major reason President Bukele gave for his billionaire-inspired scheme was not that the poor would become richer, but that the poor would have “access” to the use of Bitcoin. One spends natural resources to get Bitcoin so that people may use Bitcoin; one gives the best of one’s personal resources to the god, so that one may petition the god. As with all idolatry, the question of whether the god is in fact giving us goods, or taking them away from us, becomes obscured by the solemnity of the sacrifice, the apparent power of the deity, and the insistence of the priests.
Like most idolatrous states, Bitcoin is characterized by a hierarchy of knowledge. At the top, the Bitcoin Billionaires serve as priests to the system. They know, with all the cynicism of the voracious priest of Bel, precisely how the mechanism works in order to give them economic and political power. At the bottom, there are those who only know Bitcoin in the mode of the pious believer: baffled by blockchains, they simply know the promise that they can “get something” by using Bitcoin. It is those compelled to give sacrifices who actually make Bitcoin efficacious, a point one could make regarding all fiat currency: only belief in the efficacy of Bitcoin, and its subsequent use, makes Bitcoin actually efficacious as a unit of exchange. Where this faith falters, the idol falls. It is not like land or food. If people were simply not to accept it as having any worth, it would have no worth.
Perhaps this is why Bitcoin comes with its ritualistic side, its culture of verification, its baptisms and its cathedrals. Within state-backed fiat currency, continued faith in the efficacy of our credit cards and paper notes is, at base, faith in a state’s capacity to enforce its efficacy. This faith in the power of the State is already achieved in other rituals, baptisms, and pledges of allegiance. No one needs to be baptized into belief in the efficacy of the U.S. dollar, because American society is already a complex system designed to ensure that efficacy through its military, its police, its courts, and the participation of its citizens in its national life. As an as-of-yet stateless system, Bitcoin needs efficacious belief, that “social contract” in which multiple parties agree that something inherently worthless shall be treated as something valuable and established as a “true fiction.” Human beings are odd creatures, and need felt guarantees that such a contract really holds, beyond the dangerous game of mutual self-interest. The laying on of hands, the taking of oaths, the self-conscious description of Bitcoins participants as a reforming church—all these blasphemous appendages to the cryptocurrency endow the contract by which Bitcoin is made efficacious with ethical and religious significance, ensuring by other means what is usually assured by a standing army: that the efficacy of the inefficacious coin will not be doubted by those who use it. Whether these spiritual assurances will remain as Bitcoin is absorbed into nation-states like El Salvador, who will presumably enforce its efficacy as they currently enforce the dollar, is yet to be seen.
Footnotes
[1] This means that the base is not 10 but 16. So options run: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, A, B, C, D, E, F.
[2] Currently this is 6.25 bitcoins, but this will change in a year or so, decreasing by half.
[3] Jimmy Song, et al., Thank God for Bitcoin (Bitcoin and Bible Group: 2020), 145.
[4] Ibid, 143.
[5] STh., I q.7 a.2 resp.
[6] STh., I q.7 a.4 resp
[7] St. Thomas Aquinas, An Exposition of the On the Hebdomads of Boethius trans. Janice L. Schultz and Edward A Synan (Washington, DC: Catholic University of America Press, 2001), 43.
[8] cf. St. Thomas, Summa II-II q.77 a.4 ad 1.
[9] We removed all the “umms”, “uhs”, and “likes”, for your reading pleasure.
[10] Fourteenth century John Bromyard once wrote (satirically): “a certain man used to say that if he wished a god other than the God of Heaven, he would choose money . . . for just as the man who has God is said to have everything, so the man who has money can have everything; for all things on earth and in Hell and in the Heavens, and even redemption from sin are bought with money.” Later in the same work he compares it to Christ’s cross, which was imprinted on the English silver coins during his time: “He who has a purse copiously marked with the silver cross and always knows how to impart its abundant blessing can enter any court, and safely go wherever he wishes...This cross conquers, it reigns, and it wipes away the guilt from everything.”
[11] Paul Cartledge, “‘Deep Plays’: Theatre as Process in Greek Civic Life” in The Cambridge Companion to Greek Tragedy (Cambridge: Cambridge University Press, 1997), 3–35.
[12] Cf. Symmachus, Relations 8.1, (Edited and translated by R. H. Barrow, in Prefect and Emperor: The Relationes of Symmachus, A.D. 384 (Oxford: Clarendon Press, 1973), 60; Vera, Commento storico alle “Relationes” di Quinto Aurelio Simmaco (Pisa: Giardini, 1981), 74–82.