3 ways “The Internet of Money” changed my perception of Bitcoin

Antonopoulos’ must-read is a metaphor masterpiece

The Internet of Money by Andreas Antonopoulos is probably the one book one is supposed to read in order to start grasping the concept of Bitcoin.

This British entrepreneur with Greek roots, involved in Bitcoin since the first half of the 2010’s, is one of the most respected voices in the crypto communities, and his talent for metaphors make him a good professor for whoever would like to learn more about Bitcoin. The Internet of Money is nothing more than a collection a talks he gave between 2013 and 2016, which you can all find online, in case you prefer watching videos over reading a book.

Out of the 11 talks transposed in the volume I of The Internet of Money, here are the 3 I found the most striking, and how they can shed a new light on the current controversies surrounding Bitcoin. You will see that they open perspectives, much more than they give definite answers — Bitcoin is indeed still a newborn at the scale of human inventions.

1: “Scaling Bitcoin” — or how this endless controversy might not be such an issue after all

Prague, March 2016. The full talk: https://youtu.be/bFOFqNKKns0

In this talk made to debunk one of the strongest arguments against bitcoin, Antonopoulos draws a parallel with the history of the Internet.

He starts back in 1998, when emails were scarce, and the main use of the Internet was Usenet, a sort of slow messaging network designed to work with the infrastructures of a time when the Internet was dial-up. As the service gained in popularity, the time necessary for Usenet to process the data shared every day grew from 30mn to hours. At this point, Antonopoulos argues, “experts predicted the end”, i.e. the collapse of the Internet. “They said, if you draw a point at where we are today and another at where we were six months ago, and connect them in a line, very soon it will take 26 hours to transmit one day’s messages and then we have a problem because we only have 24”. The controversy, he adds, went on for at least two years. “Many people wrote their Ph.D. theses on why it wouldn’t scale.” Of course, eventually, it did scale. Connections improved, making infrastructures more robust, and the Usenet service easily carried on.

“Then people started using Email. and the scaling problem returned.” After alt groups on Usenet, it’s email attachments, much bigger in size, that the author says led to concerns about how the Internet could not cope with the fast-growing use of data on its infrastructure. It was then the Web, with its images and hypertext documents, followed by VOIP that allowed to run phoning via the Internet, and later cat videos on YouTube or movies on Netflix.

“Scaling is a moving target. Scale defines the edge of today’s capabilities. As it moves forward, capability increases. The reason for this is simple: it’s because scale is not a goal to achieve; it is a definition of what you can do with the network today.”

Now, this can sound like wishful thinking. History doesn’t have to happen the same way every time we see any resemblances that allow us to draw parallels. And the community is still debating and working hard on the issue of scalability in bitcoin — with real struggles.

But this is a crucial point, as scaling problems are often used in biased press coverage to simply dismiss the potential of the cryptocurrency. You think Bitcoin might never be resilient enough to handle exponential growth? You might very well be right in years to come. But pointing out this limit without putting it in perspective by reminding that the Internet itself faces massive scaling problems makes you partial at best, irrelevant at worst.

2: “Bitcoin Design Principles” — or how fixing Bitcoin UX could make it go mainstream

Boston, June 2015. The full talk: https://youtu.be/Ur037LYsb8M

Let’s face it: Bitcoin remains today still extremely difficult to understand, to explain, and even to use. In a long talk intended to participants of a hackathon, Antonopoulos says design choices of the past are to blame, and future ones could allow cryptocurrencies to go mainstream more easily.

“Design metaphors are extremely powerful tools. They allow us to create expectations.[…] But they’re also extremely dangerous when misapplied,” which is the case with Bitcoin, Antonopoulos argues.

Among all the examples given, the poorly chosen term wallet is a striking one, as a wallet is the one thing every Bitcoin user is supposed to use. And this term is profoundly misleading, since “the money isn’t in the wallet, the money is on the network. The wallet contains keys. So, it’s not a wallet; it’s a keychain. […] Can you copy a wallet? No. But you can copy a key. A keychain is a far better metaphor.”

The author goes on a list of past mistakes, stating that “Bitcoin desperately needs design — it has been created by engineers and it is absolutely inscrutable” ; but more importantly, he draws another parallel with the early Internet:

“It took almost exactly 20 years from the day I sent my first email to the day my mom sent her first email. In order to do so, a lot of things had to happen. Most importantly, the iPad. She was able to do it with a swipe of the finger, and that was the only thing that made it possible. There was no way the internet in 1989 could be used by the mainstream.”

For Bitcoin UX to be solved, Andronopoulos expects (and calls for) two trends in the next years or decades. First, designers will have to roll up their sleeves and make Bitcoin more user-friendly. Second, as the perks of using Bitcoin will become more obvious for many, entire populations will get more educated and learn a new language — the same way most people managed to grasp the difference between @ and www, all of which was at first an obscure alphabet that was only decipherable by the few.

3. “Infrastructure Inversion” — or how Bitcoin might become the new standard

Zürich, March 2016. The full talk: https://youtu.be/5ca70mCCf2M

In a talk once again full of metaphors, historical ones this time, Antonopoulos makes the point that the most innovative technologies always have to struggle first with the infrastructure of the past, before replacing it and imposing a new standard in an “infrastructure inversion”.

His most detailed example is the automobile.

“When your first ride your brand new automobile in a city, you are riding on roads used by horses with infrastructures designed and used for horses. There are no light signals. There are no road rules. There are no paved roads. […] And what happened? The cars got stuck because they didn’t have balance and four feet.”

He argues that car drivers were laughed at, with their expensive vehicles that couldn’t compete with horses in the streets covered in mud. Until we upgraded the roads, based on the new automobile standard. Not only cars could flourish, becoming the new standard for transportation, but the change of infrastructure allowed to do much more than that.

“Something really interesting happened. When you pave roads and make them suitable for vehicles, the old technologies (horses) can still use them. If you want to do a tour of Zürich on horseback, I am sure the horse would be perfectly comfortable. […] Flat, paved roads also open the door to new technologies. Now, you have people riding Segways, scooters, skateboards, rollerblades, pushing prams and all the other things that are moving around in our streets.”

He sees this flip regularly happening in history. Likewise, electricity became much more powerful than natural gas the day we reversed the infrastructure — and still can use gas.

More recently, telephone lines made for voice transmission have been replaced by data infrastructures, that not only allowed the Internet to grow much quicker than when using telephone lines, but also voice calls themselves to be made in a much more efficient way than before the flip. Actually, voice calls sent through the Internet are now so efficient that telecoms companies have to artificially downgrade the quality, so that consumers used to decades of low-quality interface still understand it is working properly (“comfort noise” simulates the noise open lines were making, in order to make sure the interlocutor has not hung up).

“The very same companies that said, ‘We will never be able to do quality voice over the internet, we don’t want the internet on our phone line’ are now injecting noise in order to simulate the terrible performance of previous networks because we’re now delivering CD-quality or better sound across continents. Complete infrastructure inversion.”

You saw it coming, Antonopoulos predicts such an inversion in finance “in the next 15 to 20 years”.

“First, the banks will resist. Then, the banks will adopt. The banks will run their systems alongside blockchain and bitcoin systems, and finally they will run all of traditional banking as an application on top of a decentralized trusted ledger.”

This would allow a whole new financial system — an Internet of money — to emerge, while traditional banking wouldn’t have to cease functioning as it can be one of the many application built on top of bitcoin.

“For example, I can create an application that takes your bitcoin transaction and makes it clear in three to five business days for a cost of 5 dollars. I have implemented traditional banking. It’s kind of like comfort noise generation.”

Will Bitcoin flip our old finance infrastructures? With this vision in mind, Bitcoin maximalists can be tempted to dismiss the accusations of current poor performances by replying it’s exactly like laughing at cars being slower than horses in the mud.

All in all, the main lesson of the book is: be patient. Most alleged flaws of Bitcoin remain important to address with critical thinking, but should always be seen in the light of how difficult it was for world-changing technologies to emerge in history — the Internet of the 90’s being the most relevant parallel to date.

If this all sounds interesting to you, I can only advise you to read the book.


Pssst: the first of those talks was given in Paralelni Polis in Prague, a foundation that hosts the very first bitcoin café in the world. That’s precisely where I spent some bitcoins for the very first time, back in 2015, and I even wrote about it (in French) at the time: