Bitcoin is a Social Creature (Mushroom) — Part 2/4

Original Artwork by Richard Giblett


In my last article, “Bitcoin is a Decentralized Organism” we explored bitcoin’s decentralized architecture through the lens of mycelium. We covered the decentralized network archetype, antifragility, PoW, arbitrage, bitcoin’s role in it’s ecology, and the merits of decentralization.

Bitcoin is a Social System Ratified by Code

Bitcoin is made up of individual constituents each with their own perspectives, motivations, and abilities. Collectively they form consensus on the rules of the bitcoin game. The code simply ratifies this social consensus.

Section #1: Human Psychology, Hype Cycles, and the Mushroom Method

Fungi exist primarily in their “mycelium form” which you can think of as an underground root system connecting trees and plants. Humans wouldn’t even know mycelium exists as it stays quiet underground for the majority of its life.

Mushroom Timelapse porn

Bitcoin’s Hype Cycles Parallel Fungal Reproduction

To the casual observer, most of bitcoin’s life is boring — months go by with relatively little action. Then when conditions are just right, bitcoin explodes into life, growing massively in size, and hijacking the consciousness of observers. Price goes to the “moon,” media is flooded with hyperbole, and “DMs from normies” flood in.

Bitcoin Detractors Mistake the Hype Cycle (Mushroom) for the Big Picture (Mycelial Network)

Amnesiac pundits proudly pile on proclaiming bitcoin has perished (for the 335th time). Fiat maximalists take victory laps on twitter by posting 12 month charts.

While the mushroom has died (recent hype cycle), the mycelium (bitcoin) is thriving underground.

Like a mushroom past its prime, bitcoin exuberance decays and the price plummets. This bear market will shake out weak hands, hedge funds will fail, ICOs will give back investor money or worse, projects will fail, and some charlatans will be exposed.

(Hodl Waves by Dhruv Bansal at Unchained Capital)

Hodlers are the revolutionaries” — Dan Held

As hodlers hoard more bitcoin, the “float” (supply actively being traded) is increasingly constrained. With a decreasing available supply, each new user puts more upward pressure on the price. As price rises, media shines a spotlight, new users are pulled in, and before long we’re back in another hype cycle.

Section #2: Mycophobia, Maria Sabina, and the Cult of Satoshi

Sometimes people say crypto can be a bit “culty.” This is both true and a net positive. Before we get into bitcoin’s religious tendencies, let’s learn from our history with mushrooms.

Humans Who Partner with Fungi have an Evolutionary Advantage

Ancient man relied on mushrooms to survive in the Alps of northern Italy. Ötzi, the Ice Man, who died nearly 5,300 years ago, was discovered carrying two mushrooms (Amadou and Birch Polypore) tethered on a leather strap. One of the mushrooms was used to start fires and the other was discovered to be medicinally active against the parasite discovered in his gut.

Cave painting: “Bee man” covered in mushrooms. Circa 4,000 BC
Mushroom artifacts from Central America

Bitcoin Conjures up a Similar Quasi-Religious Fervor

Described brilliantly by Yuval Noah Harari, Homo Sapiens are uniquely capable of cooperating flexibly in large numbers. This enables us to collectively agree on abstract concepts such as nations, gods, and money.

Each Rival Sect is a Competing Social Contract

Bitcoin’s social contract coalesces around a few simple rules. These agreed upon rules (a Schelling point) are then ratified in the bitcoin protocol automating social consensus.

(Source: Hasu’s Bitcoin as a Social Contract)

Religious Fanatic Behavior is an Indicator of Future Success?

We’re witnessing a new scarce commodity being monetized in real time. No living person has witnessed such a phenomenon.

Good Cults Have Incentives to Evangelize

Money is the ultimate network effect — its value is determined by the number of people you can interact with.

The Fungus Is Spreading

If the bear market blues make you frown, just look underground. There are countless developments (some listed above) to be optimistic about.


Did you enjoy part 2? Check out Part 3 where we explore bitcoin as an anti-virus to the modern financial system. Here’s Part 1 in case you missed it.




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Brandon Quittem

Brandon Quittem


Entrepreneur. Bitcoin. Fungi. Content Marketing and Education for Swan Bitcoin. DMs open on twitter.