The title refers to the legal profession and obtaining “Silk”,
“As members wear silk gowns of a particular design (see court dress), the award of Queen’s or King’s Counsel is known informally as taking silk, and hence QCs are often colloquially called silks. Appointments are made from within the legal profession on the basis of merit rather than a particular level of experience.” — Wikipedia
As Bitcoin continues to grow, many new people are exposed to it from different professions, and they all bring to it their prejudices and thought processes. Bitcoin is a tool. It is neutral. It is math and software. It cannot object to anything that is said about it, and there are many people who object to how it works and its inevitable side effects, that will change how things are done everywhere on Earth.
The groups of men who are having a particular problem with Bitcoin, because it directly challenges, dismantles and makes aspects of their profession redundant are lawyers. In order to prevent their complete displacement and disruption, they have two choices; either corrupt the technology, or call for it to be outlawed or made unusable via regulation. The latter will not work, because billionaire entrepreneurs are shovelling money into Bitcoin, and the network is growing steadily and rapidly. Subsequently they are left with the former as their only route to control Bitcoin’s effects and consequences.
In reality what the Bitcoin detractors have as their sole remaining tool is a campaign of FUD (Fear Uncertainty and Doubt) to try and convince other computer illiterates that Bitcoin is somehow not what it appears to be. They will fail of course, just as the MPAA/RIAA failed to stop file sharing with its propaganda equating BitTorrent with terrorism.
What is interesting about the objections to Bitcoin raised by these men is just how little they know about the subject they are addressing, and how desperate and threadbare their objections are. Lets go through some of them now; they are all variants of the latest iterations of anti-Bitcoin FUD which has had to rapidly adapt and retreat as a direct result of the spread of Bitcoin and the historic volumes of investment in its infrastructure. Someone is wrong here, and it is easy to see who it is if you have a firm grasp on the details.
Where is The Money?
The first objection these people now raise is the statement that Bitcoin advocates are not “thinking commercially”. This is untrue. All the people investing in Bitcoin and writing software that leverages it are using only commercial thinking. They have done their homework, done their research, installed the tools and other necessary software, made their calculations, and understand how Bitcoin works. Bitcoin is software that is very understandable whilst simultaneously being a breakthrough. It is not unlike E=mc^2, which whilst being a short formula, is incomprehensible to anyone but physicists in the actual mechanics. Anyone can understand Bitcoin in five minutes; all you need is the CoPay wallet, topped up via a voucher. It could not be more simple.
Scepticism is not rational or applicable to software. Software is something you can read and understand; there is no mystery involved in it (unless you are not a software developer) and it is not hard to understand the simple principles of it if you are not. Software is logic and math. It uses the principles of logic and math, and there is nothing in it that is hidden if you can see the source code, which you can with Bitcoin. If someone says they are “sceptical of Bitcoin”, you know you are dealing with a man who does not understand what they are talking about.
How it Can All Go Wrong
Here is an example of how not understanding what software is can lead to total confusion when it comes to forming a sound opinion on Bitcoin.
A man who coincidentally happens to be a lawyer claims that Blockchains do not transfer assets, they record data. This is true, but it is true of all Blockchains, whether they are the main Blockchain or a privately controlled fork or derivative of it. Since the number of people participating on a Blockchain determines how tamper proof the entries on it are, it makes sense for everyone to contribute to a single Blockchain with their computing power, so that the integrity of recorded data is beyond dispute and the reach of tamperers and fraudsters. Making smaller bespoke Blockchains without the hashing power to secure the records does not make sense, or commercial sense, since it is the integrity of the stored records that is the business proposition and tool.
Once we accept this fact; that the Blockchain is an infallible, tamper proof ledger that everyone can write to, access and see without having to get permission from or pay a third party, saying that registering assets and moving them by hand signing a document and emailing it is “just as good” is clearly incorrect.
There is no infallible unforgeable public record of communication when you send a scan of a hand signed document by email as proof of a transaction. You cannot even prove that the sender is who they say they are, because emails can be forged. Furthermore, signatures on paper can be scanned and cut and pasted in Photoshop to create an unlimited number of perfect forgeries. The example offered here by the Bitcoin detractors is clearly nonsense, but it speaks loudly to the level of computer illiteracy of men who think that scanned documents are equivalent to cryptographically secured entries on the Blockchain. The same goes for moving money by SWIFT; another example offered that is, we are meant to believe, equivalent to entries on the Blockchain. SWIFT, which is a private network, unaccountable, inaccessible to the public, unverifiable, slow, reversible, and which requires third parties to access it is completely inferior to Bitcoin for any purpose. Bitcoin entirely removes the need for SWIFT, and because anyone can build software against the Blockchain, it makes SWIFT completely redundant. A simple thought experiment shows how this is so:
In Bitcoin as “Open SWIFT”, unique tokens are exchangeable for money by anyone holding the keys to them. If you receive Bitcoin, you can assign it to anyone on the Earth without permission, for fees that approach zero. The tokens are re-registered instantly and irrevocably.
In three sentences its possible to construct a model that completely eliminates the need for central clearing by SWIFT; all that needs to be built is the infrastructure around the edges, with Bitcoin at the centre. This is being done.
This is the sort of thinking real entrepreneurs do; they don’t spend time trying to make others not look at or dismiss a technology, they solve
problems and then offer their solutions to the public, without tricks, memes, slang, FUD, nonsense or any form of deception.
Who is Confused?
When people say that Bitcoin can be used as “a digital representation of an asset” the meaning is not at all confusing, as some might like you to believe. Paper money used to be a token that represents the power of a holder to redeem an amount of gold or silver at a central bank indicated on the note. When men talk of “a digital representation of an asset” it is in this context that they are speaking. Everyone knows that the deed to a house is not the house itself; it is a document proving that you own the house. Putting that document on the Blockchain is simply a way of removing the possibility of unauthorized tampering with the entry, in a way that is infallible. The UK Land Registry is a perfect example of this, where anyone can see who owns what property, and transfers of property registered on it can only be made by lawyers. In the Bitcoin Blockchain mediated Land Registry, only the people with the keys to the entry can change titles, and anyone can see all the titles and who owns what. Its a much more efficient, and importantly, fraud proof and transparent system that is fast, and less expensive to run for the State. Unfortunately for lawyers, their position as gatekeepers is made completely redundant, and they only have a role to play when a dispute emerges. This makes them uncomfortable, just as the Buggy Whip makers where made uncomfortable by the advent of the motor car. And we know what happened with that disruption.
Tokens Are Terrible… For Who Exactly?
To say that “tokens are a terrible way of representing financial assets” is simply odd, unless you take into account who is making the claim. All financial assets are tokenized, from deeds to property, shares, bonds and money itself. No one who owns shares in Apple actually thinks they can go to Cupertino and cut out a piece of the headquarters because they own shares in Apple. Shares are tokens that represent a proportion of ownership in a thing. This has been going on for hundreds of years, and is not new or controversial. Bonds may be thought of a “bundles of rights”, but who owns those bonds, when they mature and what their value is are all reduced to symbols on paper or in a computer. What the Blockchain and Bitcoin do is make management and transferral of those symbols and tokens doable by anyone without the need for a third party to manage security and verification of who owns what and who is who.
To say “evidence of title is easily demonstrated with things like signatures and chains of evidence like correspondence” is to fundamentally misunderstand cryptography and how it works in the Blockchain and out of it. It also betrays that you are hearing the perspective of a Luddite Lawyer, who only understands the existing forms and procedures of his profession, is stubbornly resistant to change, and who has no insight into cryptography and software. It is a fact that in the recent past, there were lawyers who only accepted personally signed original paperwork as properly executed documents and rejected facsimiles of signed paperwork, “because facsimiles are not the real thing”. Very few lawyers in the west demand in personam signatures now because they know that a fax is good enough and waiting is not convenient. Blockchain signatures and authentication will similarly completely replace faxed paperwork and hand drawn signatures. In order to understand why this is so, you must understand what a digital signature is, and why it is unforgeable and completely reliable. Digital signatures are not only more secure than signatures on paper, but they can be made and transmitted instantly.
The Dotted Line
The making of unforgeable signatures at a distance represents a sea change in how business can be done and identity authenticated; you can be anywhere on Earth and sign a document in a way that is unforgeable and yet human readable and verifiable. This is called “Clearsigning” and you will only understand what that word means if you are familiar with public key cryptography.
It is not a requirement of every Bitcoin user that they know about Public Key Cryptography, but if you are an entrepreneur trying to sell software that uses a fork (variant) of the Blockchain source code, you would be well advised to completely understand the basics of it, so that you don’t spout out outrageous schoolboy howlers like,
“A signature on paper faxed is as good as an entry in the Blockchain”
Anyone seeing guff like this instantly knows that the speaker doesn't know what he is talking about, does not use or understand Public Key Cryptography, and therefore probably has other gaps in his knowledge that make his claims about his own software at the very least, less robust.
Case in point, to say that,
“commercially you probably don’t want to use a “decentralised” network” to store documents and signatures”
shows a complete misunderstanding of why the Bitcoin Blockchain is secure. The fact that it is publicly maintained is the exact reason why it is secure and invulnerable. Anticipating the criticism that people do not want their private documents to be stored publicly, once again, a computer literate man would know that you only need to store the signatures for the documents in the Blockchain, not the documents themselves, where the signatures would be infallibly time stamped and recorded. Digital signatures can be generated that are detached from the documents they relate to, and the signed content does not have to be bundled along with the signature.
Commercially, this saves time and money, and allows people from all over the world to validate documents wherever they are, without permission or needing to rely on a third party. Building the software that manages this and abstracts the complexity away from the user is the textbook definition of a business opportunity.
Ned Ludd’s Hammer Comes Down
This is the difference between true entrepreneurs and men masquerading as entrepreneurs; the true entrepreneur is thirsty for knowledge and new techniques, and as he acquires and consumes them, he blends them into his products, simplifying and strengthening them. The anti-entrepreneur wants to dismiss, destroy, distract and dissuade.
People who are against the Blockchain and Bitcoin are anti-entrepreneur “Tech Luddites”, who, seeing their professions under threat as the original weavers did in Ned Ludd’s era, are trying to smash the global loom that is Bitcoin.
This time, there is no physical place to attack and no loom to smash, just software and an idea, and so they attack with their own worthless counter ideas and broken software. Sadly for them, counter ideas have no force, and no one wants broken, worthless, useless software. Software is thinking in motion, and the only way to counter it is with more software….that works. Blockchain spin-offs provide no advantage because they don’t have the scale and security that the true Bitcoin Blockchain has, and so they fail. If they do not fail, then they are fulfilling a market purpose, and none of this applies to them. In that scenario, there is no need to be a Bitcoin detractor, because what you have works exactly as described and is also useful and being rapidly adopted.
As is to be expected, a lawyer will invoke, “Legal Nexus” as a reason why the Blockchain is not workable. This is a clear expression of the panic stricken sentiment, “You cannot do without us or the sky will fall!”, but of course, no one is saying that there will be no disputes in a Blockchain mediated world. What we are saying is that the definitive transaction record will be the Blockchain, not a private, bespoke, corruptible ledger, where the rule is, “trust us, we are professionals”*.
“Trust me I’m a lawyer?” I don’t think so. Everyone will refer to the Blockchain as the definitive record, no matter who you are, be you lawyer or layman. No one will trust a private Blockchain to record ownership of their valuable assets; the first thing a thinking man will ask is, “What are they trying to hide? And why do they want the power to reverse entries!?* These guys are CHEATERS!” Trust-less transactions are one of the effects of Bitcoin and the Blockchain. The need for third parties as verifiers, intermediaries and authorities is removed and this is what troubles the men whose profession it is to do those things.
The argument that the Blockchain doesn't verify that the owner of an asset is the real owner is a Straw Man Argument, and demonstrates once again, a fundamental lack of knowledge about digital signatures, Multisig Bitcoin Transactions and how cryptography works. Contrary to what some would have you think, the Blockchain does provide you with a facility to verify that the thing someone is trading is actually that thing; through Multisignature Transactions. Oddly enough, this is where the law profession, could have a new central role in the Blockchain mediated world; acting as a signature party verifying that the assets in question are what they say they are. This would be a reduced role for them, but it would be for the good of society, so I’m sure they would gladly accept it. Here is how it could work.
Take a car or a house as an example; you can link a Bitcoin transaction to that object’s serial number or address, which is created and signed by the original owner or manufacturer infallibly, and their lawyer. This is the “root ownership document”, created by the company or man that made the object. When that car or house is transferred in a Multisignature Transaction, the lawyer and the original owner both sign off on the transfer and this Multisignature Transaction is recorded on the Blockchain, unalterably transferring proof of ownership to you. There is no need for “certified copies” because that is what the Blockchain provides; its is the ultimate infallible certification authority. No prior interests can be usurped because in order to transfer an asset, they (the original owner) would have to sign any transaction on the public ledger. Anyone who has priority to you has an infallible lock on the asset no matter what it is. Transferring encumbered assets is impossible on the Blockchain; this is why people are so exited by this new software. Those who do not understand it, use childish language like,
crypto-escrow-thingy
to describe a Multisignature Transaction Escrow system as Brawker used, because they either do not understand how the software works, or they do, and are deliberately trying to belittle and spread FUD on the exiting capabilities and incredible potential of the Blockchain.
The argument that counter party risk still exists with bond tokens on the Blockchain is another Straw Man Fallacy; what the Blockchain does is provide and infallible public register of assets. It has nothing to say about the soundness of an investment, or the solvency of any business. This is also true of shares and bonds recorded on paper of course. These threadbare anti Bitcoin arguments are the sound of rattling empty soda can desperation. Nothing more.
Clifford Stoll... Again?
Saying that the Blockchain is an excellent global data management system but it is not “mainstream” or “commercial” is absurd. Mainstream simply means widely used, has nothing to do with its inherent properties or utility, and the software to make it widespread is being written right now. As for commercial, the same applies. This is not an argument against Bitcoin’s capabilities and no true entrepreneur would ever make them. It’s the same class of Clifford Stoll argument in form and style along the lines that no one will ever use the internet, “because you can’t find anything on it”.
The same goes for the “ten minute confirmations are a problem” objection. This argument is made by the same men who think that signing paper, scanning and faxing it is better than a digital signature. The amount of time it takes to have a secretary print a contract, scan it, fax it, have it received, signed, returned, and then inspected, approved and countersigned will always be more than ten minutes. The confirmation time objection is nothing more than a Straw Man, and a very silly one at that. If the confirmation time never shortens, Bitcoin will still be more efficient and beneficial by orders of magnitude compared to paper mediated signatures, because anyone anywhere can use it for legal document purposes without a third party. The savings in time both individually and in aggregate make the ten minute window a very cheap price to pay. And we must also never forget, that the ten minute confirmation window is not set in stone; we are talking about software, that will always be improved and made more efficient. Bitcoin and its features are not permanent or forces of nature; anyone with even a cursory understanding of the subject knows this, and knows that improvements are always possible. The same people who complain about the ten minute confirmation “problem” could never predict the emergence Bitcoin in the first place. They are nothing more than noisy negativists.
“LOL WUT?!”
Which brings us to another schoolboy “out of his comfort zone” howler. Where the author tries to bamboozle his computer illiterate reader with “tech jargon” to try and convince them that he is an authority on software, an obviously false claim which anyone who knows anything about software can instantly see through. It is precisely this sort of nonsense that throws serious doubts on any other claim about the software being peddled by people who talk like this. To argue that Bitcoin,
has limited scripting capabilities
betrays a complete misunderstanding of how software works. The Bitcoin reference client is a software daemon, that you can address with your own bespoke software, sending commands to it and retrieving answers from it via its Application Programming Interface or “API”. You can literally write any software imaginable against the Bitcoin daemon’s API, in any language you choose. Bitcoin’s scripting capabilities are no limitation whatsoever, and to invoke it in this way shows the writer is completely clueless about how not only Bitcoin works, but how services on the web are architected.
The schoolboy howlers don’t end there though. On one line, the writer claims that
Bitcoin is not a foundational protocol, like TCP/IP
He then says four lines later that a Blockchain has two components, one of them being “Its protocol”. I'm not making this up. Since he instantly concedes that the Bitcoin has and is a protocol, the question then becomes what does the word “foundational” mean? Does it mean how many people are using it? If so, if 21 are successful, the Bitcoin Protocol will be exactly that; the foundation for global commerce built in to every device from your wristwatch to your toaster. Millions of transactions are are being conducted via the Bitcoin protocol right now, and this is a fact. The protocol is readable and usable. Do we really have to spell this out? It appears that we do. The scale at which something is used does not have any bearing on its nature. There are many protocols some of which are no longer in wide use, like Telnet, yet they are all still protocols, and Wikipedia itself lists Bitcoin as a protocol:
Next another loud howler. Saying that the entire world should use one ledger is not the same as saying that the world “should store the entire English literary cannon in one book”. That is a very poor analogy. Saying the world should use one ledger is like saying the entire world should store every book on the internet… and that is exactly what has happened, and only copyright maximalists and, surprise surprise, lawyers, think this is a bad thing.
Bitcoin absolutely is a new protocol on the internet; it is a new layer where what arbitrary address owns what entry can be stored and retrieved. There is nothing at all absurd about a world wide ledger if you characterize the idea correctly and understand precisely how it works. In order to do that, you cannot remain a computer illiterate.
Another example of computer illiteracy; comparing LAMP stacks to the Blockchain is absurd, and once again, shows that anyone can throw around terms without understanding what they mean. LAMP stands for Linux Apache MySQL and PHP, the operating system, web-server, database and scripting language respectively. These free tools are used to build essentially any application you can imagine from facebook on. MySQL is the software that many companies use to create and manage their databases, and this is the part that some anti-Blockchain men are trying to replace, not understanding what MySQL is, or the context it is used in.
The “B” Layer
LAMP can be used to interface with the Blockchain by adding another layer to it, the “B” layer. It means running a copy of the Bitcoin server daemon, and then accessing its functions from LAMP. In a “BLAMP” setup, you can write to the Blockchain and read from it, including other people’s entries, and so can anyone else using BLAMP. That means you can write a title to the Blockchain, and anyone anywhere can verify that the write occurred. With Multisig, you can also make an infallible claim that other verified persons or institutions have “signed off” on any transaction.
This is the correct model for anyone wanting to build applications with the Blockchain; not to create their own private, unverifiable, insecure, reversible*, broken Blockchain, but to add the new protocol layer in a BLAMP application, using the Blockchain as a global readable, writeable, infallible authentication layer for every sort of transaction imaginable.
Now consider this. The Blockchain is a,
fully public open ledger which everyone can see, and which nobody controls.
Do you consider this to be a feature or a problem? Depending on your profession, the fact that the Blockchain is not under the control of anybody and is neutral is a feature, unless your profession is the control and mediation of man’s legal interactions and obligations. The Bitcoin Blockchain does this, and it is a benefit to ordinary men at the expense of professional mediators.
What matters ultimately, is that all the entries on the Bitcoin Blockchain are unforgeable and immutable once written. And the implied lack of privacy by using the phrase “fully public” is easily addressed as I described above, by only storing the digital signatures of documents in the Blockchain, not the plain text documents themselves, the signatures being privately verifiable by GPG on the office side. In order to understand how that works, you need to be computer literate, and understand Public Key Cryptography, which obviously the author does not.
Once again saying,
It’s not possible to do XML/FpML or anything even remotely that complex on Bitcoin
shows the writer doesn’t understand how software is developed. Anything you require in terms of function can and is provided in the software that communicates with the Bitcoin daemon. That logic is something your company has to author, and once again, true entrepreneurs immediately see business opportunities in creating off the shelf software packages that do this work so that the authoring of these tools doesn’t need to be done in house.
That Old Chestnut?
Saying Bitcoin can’t scale is something only a man who is completely inexperienced would say. Google will show you (if you know what to ask for) that for decades people have been raising the Straw Man that X software product “doesn’t scale”; on Slashdot its been a running joke for many years, along with the other hilarious ones like “FreeBSD is Dying”. For someone who uses forced memes to try and sell software, this is particularly hilarious.
Once again, as I said before, objections to software are essentially irrational. The only people who make them are men who are trying to complete in a space, or who have some other nefarious agenda, like the MPAA/RIAA and their pathetic attempts to conflate BitTorrent with every crime imaginable.
The Verdict: Guilty. Wishful Thinking and FUD M’lud
Objections to software must be made with software, not fallacies. Wishful thinking cannot stop software. If you want to understand how software works, you must download it and use it, and read its documentation. There are no short cuts. Men who refuse to download and run software, but who continually raise objections to it all come from the same class of corporate professional class; they are computer illiterate jargon mongers, who try and cover their ignorance with bad college humour, fallacies and nonsense. Their appeal, limited or not, is irrelevant; only the software matters, and in this case its Bitcoin, which will not be stopped or derailed by any lawyer or faddish entrepreneur without insight.
The world has changed. The landscape is shifting with a quake that is way above 9 on the Richter scale. The edifices of the law and banks are being toppled by this quake, and in their place will be something better, faster, more widespread, secure and equitable, with a side effect of peace, the end of inflation and prosperity.
Now what sort of man wouldn’t want that?
*Etherium
Grilled rack of lamb, mushrooms, string beans. 2 large Westmalle Tripples:
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