The hallmark of a good scientist is changing your mind when new evidence arises. Here’s what that looks like.
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Today, economist and Nobel laureate, Paul Krugman, wrote in the New York Times, that Bitcoin is taking us back 300 years in monetary evolution. As a result, he predicts all sorts of bad things.
A significant basis for Mr. Krugman’s argument is that the US dollar has value because men with guns say it does.
Is Bitcoin erasing 300 years of monetary evolution?
Running with the metaphor that fundamental change to an economic mechanism represents ‘evolution’, I think a more accurate statement is that Bitcoin is not erasing the lessons of history. Rather, it is the current step in the evolution of money. Of course, with living species, evolution is a gradual process based on natural selection and adaptation. With Bitcoin, change is coming up in the rear view mirror at lightning speed.
The Evolution of Money
When a medium of exchange is portable, fungible, divisible, unforgeable and widely accepted, it becomes money. For at least six millennia, barter was gradually replaced by various mediums of exchange.
- Obsidian —» Cowry shells —» Gold —» Promissory notes (backed by a Bank, employer or wealthy industry) —» Fiat (national currency)
But what backs these forms of money? What gives them value?
The first 3 currencies above were accepted as money on 5 continents. They were backed by their scarcity and unique characteristic properties (Aristotle called this intrinsic value). But even gold cannot serve as a widely used currency today. Although it is portable and scarce, it is not easily tested or subdivided in the field; it is risky to transport and difficult to track; and it is not suited to instant electronic settlement. But what about Fiat money. What backs it?
What Backs National Currencies?
Fiat has been backed by various different things throughout history. They are all compromised attempts to establish confidence and trust. They are compromised, because the fall short of one or more facets of trust.
In the list below, monetary backings in Red are what Mr. Krugman calls “men with guns”. That is, he claims that government demands give value to the dollar:
- Value tied to gold —» Promise of redemption —» Legal tender (public must accept it for all debts) —» settlement of taxes —» The “good faith and credit” of workers
Unfortunately, the transition away from a trustworthy basis and the constant temptation of kings, dictators and politicians to print money based on credit (or nothing at all—as in the case of our fractional reserve system), has created a house of cards that few people believe is sustainable.
Bitcoin changes all this.
Finally, a crowd-sourced trust basis was invented (or discovered). It is unhackable, un-inflatable, unforgeable and immutable. Most important, it allows a government to be decoupled from its own monetary policy and supply. This is a remarkably good thing for businesses, consumers, creditors, trading partners—and especially for governments.
And Bitcoin is backed by something better than guns, gold or promises. It is provably scarce, capped in supply, completely fair, and built on a massive, crowd-sourced network of bookkeepers and auditors. It is the first currency—and quite probably the last—built on genius math and indisputable trust.
Despite the gross misunderstandings and misconceptions of early pundits, it does not interfere with a government’s ability to tax, to spend or to enforce tax collection—and it does not facilitate crime.
Bitcoin is new, but the goal of distributing trust is not as radical as you might think. It addresses a problem that economists and mathematicians have pondered since Aristotle and the ancient Greeks…
Background
Ever since the transition from real gold to government notes, bank notes and bank ledgers—economists have wondered if value can arise from a public trust that is durable, distributed and stateless. Until 2009, the answer seemed to be that this was impossible because of the double-spend problem.
But 9 years ago, something changed; and the change is dramatic. It will take an additional decade for most people to understand and appreciate this change…
In the first paragraph, I cited Mr. Krugman’s statement that the US Dollar has value because of “men with guns” (a reference to the fact that its use is legally compelled for payment of any debt and for government taxes). But this is not what gives it value. The dollar, the Euro, a Picasso painting and a fresh serving of hot french fries all derive their value from supply and demand. Bitcoin is no different. The trick is to generate viral demand and a ubiquitous infrastructure needed to achieve a robust two-sided network.
In the white paper that introduced both blockchain and Bitcoin (the first blockchain application), Satoshi taught us that a widespread and easy to access communications network (the internet and universal access to smartphones) can give rise to value that is based on a different type of trust. Instead of trust in a government, a bank, or testing the chemistry of a precious metal, value can arise from trust in a formula that is ubiquitous, redundant and constantly monitored and vetted.
All of these things have a value based on demand and the available supply. But with Bitcoin, the medium of exchange (and additionally the store and transfer of value), can be achieved by math, distributed trust and a pure, two-sided network.
So, is Bitcoin taking us backward in time, utility, safety and governance? I have never been awarded a Nobel Prize—but it seems pretty clear to me that Bitcoin is taking us forward and not backward.
Philip Raymond co-chairs CRYPSA, hosts the New York Bitcoin Event and is keynote speaker at Cryptocurrency Conferences. He sits on the New Money Systems board of Lifeboat Foundation. Book a presentation or consulting engagement.
Lithium-ion batteries are effective, but they can be a bit on the expensive side. Striking a balance between common materials and efficiency is important, and regular old salt looks like it could fit the bill – after a few kinks are ironed out. Now, researchers at King Abdullah University of Science and Technology (KAUST) have developed a way to make “disordered” graphene that can help improve the sodium-ion battery recipe.
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Experts widely agree that human activities are harming the global environment. Since the Industrial Revolution, the world economy has grown dramatically. Overall this is a success story, since rising incomes have lifted millions of people out of poverty. But it has been fueled by population growth and increasing consumption of natural resources.
Rising demand to meet the needs of more than 7 billion people has transformed land use and generated unprecedented levels of pollution, affecting biodiversity, forests, wetlands, water bodies, soils and air quality.
On August 1, humans will have consumed more natural resources in 2018 than the Earth can regenerate this year, according to the California-based Global Footprint Network. This environmental nonprofit calculates the annual arrival of Earth Overshoot Day – the date when humanity’s demands on nature exceed what the network’s analysts estimate the Earth can regenerate over the entire year. August 1 is the earliest date since ecological overshoot began in the early 1970s.
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A discussion about why life extension isn’t selfish.
The topic of life extension is much more debated these days than before. As a result, more people who are not in the field talk about it, and they don’t always do so in praising terms. Articles written by outsiders tend to be conservative at best and fear-mongering at worst, mainly focusing on the potential downsides of life-extending technologies without paying much attention, if any, to the benefits, as if there weren’t any to begin with.
One accusation that is often thrown at life extensionists is that they would be selfish for wanting to extend their lives. It is all too easy to say that all that life extensionists think about is their own benefit while disregarding the common good, but it’s not too difficult to see how this is entirely wrong.
Life extension is about eliminating the suffering caused by the diseases of old age, and at this stage, it is not clear who will actually make it to a world where these diseases are under control; many of today’s rejuvenation advocates might simply die before the world they are trying to build will come into being. I am not trying to say that all rejuvenation advocates do what they do only for others’ sake, because that would not be true, but the opposite claim—that all advocates of life extension are such only for exquisitely selfish reasons—is quite a stretch, to the point of slander. It is no different from claiming that all women’s rights advocates who happen to be women only care about this cause for their own benefit and not at all for their fellow women, and it is equally outrageous.
Despite its remaining mystery, the ocean is a complex working environment, widely used for fishing, shipping and recreation; but so far largely untapped for energy generation. OCEANERA-NET seeks to give the industry the boost it needs.
The European Union coastline runs to around 66 000 kilometres. This vast stretch holds a largely unexploited potential for ocean generated electricity, calculated to be around 380 GW by DG MARE (the EU Directorate responsible), constituting a significant contribution to the EU’s 2020 targets for renewable energy.
Presently, there are a number of Member States funding research and development into ocean energy technology. However, these efforts are not coordinated and so not the game-changers they could be.
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The energy-generating potential of solar panels – and a key limitation on their use – is a result of what they’re made of. Panels made of silicon are declining in price such that in some locations they can provide electricity that costs about the same as power from fossil fuels like coal and natural gas. But silicon solar panels are also bulky, rigid and brittle, so they can’t be used just anywhere.
In many parts of the world that don’t have regular electricity, solar panels could provide reading light after dark and energy to pump drinking water, help power small household or village-based businesses or even serve emergency shelters and refugee encampments. But the mechanical fragility, heaviness and transportation difficulties of silicon solar panels suggest that silicon may not be ideal.
Building on others’ work, my research group is working to develop flexible solar panels, which would be as efficient as a silicon panel, but would be thin, lightweight and bendable. This sort of device, which we call a “solar tarp,” could be spread out to the size of a room and generate electricity from the sun, and it could be balled up to be the size of a grapefruit and stuffed in a backpack as many as 1,000 times without breaking. While there has been some effort to make organic solar cells more flexible simply by making them ultra-thin, real durability requires a molecular structure that makes the solar panels stretchable and tough.
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The weirder Goop went, the more its readers rejoiced. And then, of course, the more Goop was criticized: by mainstream doctors with accusations of pseudoscience, by websites like Slate and Jezebel saying it was no longer ludicrous — no, now it was dangerous. And elsewhere people would wonder how Gwyneth Paltrow could try to solve our problems when her life seemed almost comically problem-free. But every time there was a negative story about her or her company, all that did was bring more people to the site — among them those who had similar kinds of questions and couldn’t find help in mainstream medicine.
Taffy Brodesser-Akner is a staff writer for the magazine and a writer for The Times’s culture desk. She last wrote for the magazine about the author Jonathan Franzen.
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