A associated cousin of that is the notion that bitcoin is “backed by” vitality. Usually, this comes up when a nocoiner says, “However Bitcoin isn’t backed by something.” So, in some circumstances, a nicely intentioned however incorrect Bitcoiner might say, “No, Bitcoin is backed by vitality!” However that is incorrect.
Usually, when one thing is “backed by” one thing else, it implies that it one way or the other has the help of another entity, like a authorities. Traditionally, individuals say the U.S. greenback was “backed by” gold, and folks may traditionally redeem notes for gold, however no such factor exists with Bitcoin. So, maybe a greater query to ask is, “What’s gold backed by?” Solely then are we attending to the reality of the matter: it was all subjective valuation all alongside. Magnificence is within the eye of the beholder.
Bitcoin As Violence Or A ‘Weapon’
Some individuals wish to body Bitcoin as a form of “digital violence” or, extra just lately, body it as a weapon and a part of a “delicate battle protocol.” However this can be a gross misrepresentation of what Bitcoin is. Bitcoin is extra like cryptographic messages being handed round and validated on a community. Certainly that’s nearer to “speech” than a “weapon.” Or, extra precisely, bitcoin will be regarded as a rivalrous digital commodity (the primary of its type), working on an open-source financial community.
If the pen is mightier than the sword, wouldn’t it be acceptable to name a pen a weapon? Not likely. Additionally, this complete line of argument is clearly blurring a line between what’s voluntary, and what’s initiating aggression (which is the half that’s incorrect). How is working a node, adopting bitcoin as a rivalrous digital commodity and collaborating within the community a type of “weaponry”? That is simply gross mischaracterisation. Phrases imply issues.
Among the analogies and metaphors utilized in relation to “bitcoin as delicate battle protocol” relate to miners competing to safe the “chain of custody.” However do they? Or is it actually extra like Bitcoin nodes are what safe Bitcoin? Miners can’t make invalid transactions seem legitimate to those that are working and verifying transactions with their very own Bitcoin node. So, isn’t it extra related to consider it like nodes safe Bitcoin? The job of miners is necessary, however their job is extra associated to finality of transactions
So, What Is The Actual Fact Then?
So, as talked about earlier, economically talking, bitcoin is extra precisely characterised as a rivalrous digital commodity. Bitcoin is the commodity itself — it’s not a declare on one thing, it’s the commodity itself. When individuals ask what it’s backed by, this means they haven’t fairly grasped what it’s.
If an analogy helps a brand new individual get into Bitcoin and begin taking place the rabbit gap, that’s nice! However as that individual advances their data about Bitcoin, further precision about what Bitcoin is will assist us all.
Because of my good friend Conza for uplifting this text and offering suggestions.
It is a visitor put up by Stephan Livera. Opinions expressed are solely their very own and don’t essentially mirror these of BTC Inc or Bitcoin Journal.
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