A Patent Based Bitcoin Mining Monopoly is Not Possible Because Ayn Rand
All monopolies are created by a special privilege for government.” ~Ayn Rand
Why does Ayn Rand say this (and with such egotistical conviction)? And why should we listen to a literature writer who was not an expert in economics and law?
Consider this argument…consider this frame, possibility, or postulate…
Free market capitalism IMPLIES the possibility of a winner. The system is held together because of the competition to win.
If government steps in and blocks a certain participant (or many or all but one participant) from having an equal and fair shot at winning this is NOT a free market.
Ayn Rand, in a sense, is being tautological:
…Nobody in a free society, now we are talking about a free market, in which the government doesn’t interfere, nobody can become a monopolist. All monopolies are created by a special privilege for government.” ~Ayn Rand
What Are Patents?
A patent (/ˈpætənt/ or /ˈpeɪtənt/) is a set of exclusive rights granted by a sovereign state to an inventor or assignee for a limited period of time in exchange for detailed public disclosure of an invention. An invention is a solution to a specific technological problem and is a product or a process.:17 Patents are a form of intellectual property.~wiki
Capitalism argues that property rights are necessary for a free market and for the government to take away the individual's rights to own property is to take away their natural rights.
Communism on the other hand, or more specifically Marxism, believes that all property should be publically owned, allegedly FOR the people, but BY in practicality by the ruling regime.
In the former example the individual has the possibility of winning through competition, and profiting from their success. In the Marxist view EVERYONE is supposed to profit off of ANY individual’s success and the governing structure enforces this.
Free market capitalism, or the Ayn Randian view, argues only a free market provides benefit to the public in this way:
Patents provide incentives for economically efficient research and development (R&D).
In accordance with the original definition of the term “patent”, patents are intended to facilitate and encourage disclosure of innovations into the public domain for the common good.
Patents are part of the infrastructure that incentivizes (and funds) inventors to create technology which we all benefit from.
Is Bitmain (and Jihan Wu) a Bitcoin mining Monopoly?
The existence of patent law is part of the capitalistic structure that holds up a free market. Inventors deserve to get paid and inventions need incentive otherwise would-be-inventors are forced to spend their time in other fields of work.
A Chinese owned/born patent is NOT an example of the Chinese government interfering with the INTERNATIONAL bitcoin mining market.
And the large success of a bitcoin pool and/or an ASIC manufacturer is not at all necessarily an indication of a monopoly.
What if China secures the largest majority of bitcoin mining?
Our global macro-economic economy and the relationship of nations (for example) is extremely complex. So much so that no subset of it can solve the problems international trade must address.
It might very well be that the solution to the world’s economic and geopolitical problems are such that we need China to have a (DE FACTO!) monopoly on the bitcoin mining industry.
What we DON’T want is for a fraction of individuals, ignorant to the importance of the free market and causes of monopoly, to try to usurp and control the free market (of bitcoin mining).
Is Bitcoin Decentralized?
Bitcoin is an internationally traded commodity in which no single national government could hope to control, stop, or defeat. It doesn’t bow to borders provided there is some international communication outside such borders (ie the Internet).
To control Bitcoin a government would have to reach beyond its own borders and into the constitutions of many or all other countries which is not possible.
This is the power of bitcoin and why it exists as the end of government and central bank’s monopolistic control over money issuance.
The Socialist Proposal of Usurping Bitmain’s Covert ASICboost Implementation
The participants in the bitcoin project have a right to run the code they wish. But there is no moral ground (we base moral ground on ensuring the freest markets possible which in turn ensures the largest degree of natural rights for the most individuals as possible) for proposing or voting for a proposal that takes away a competitive mining edge.
Citing a monopoly is an incorrect use of the word monopoly.
Claiming success by an entity is immoral because it is bad for the group is in itself an immoral claim rooted in communist and marxist style thinking.
Only an International Governance Structure for (or Over) Bitcoin Could Ensure a Mining Monopoly
The articles of federation for bitcoin Unlimited is an example of such a structure. The articles SEEMS on the surface to support decentralized mining. But in effect they create an infrastructure for the BU philosophy to control all mining:
Pool Operator: a publicly identified BU member who is responsible for running the BU Mining pool as specified in Article 4.
To alleviate real or perceived risk of this pool gaining more than 50% of total network hash power, if the pool’s hash power exceeds an average of 30% for more than 30 consecutive days, it must disband into two completely separate entities with no personnel overlap.
I. The Pool will be run by the Bitcoin Unlimited Pool Operator and other real-identity-known Bitcoin Unlimited members as designated by the Pool Operator
Users, companies, and other ecosystem stakeholders will be incentivized to contribute to this pool as long as it supports their values.
The pool is allowed to grow and make de facto splits into more pools, allowing it to hold far more than the majority of mining hashrate.
If Jihan Wu was made pool operator for BU (or someone Jihan could exert influence over) then THIS would be international government intervention in the bitcoin sphere and then we would expect a mining monopoly to emerge.
The Network Work Reject Immoral and Irrational Proposals
A proposal to USURP a patent based mining edge will be rejected by the network as will any communist or marxist based/style proposal.