Crypto, humanity, and the path to abundance — Bitvo

The times were different then. The people of that time didn’t have computers in their pockets or direct market access for stock, crypto, and options trading. Nor did they have Google or other major search platforms to potentially guide their thoughts.

And yet the technology of that time contributed to the conditions leading to both destruction and misery and the potential for something greater in the future.

2023 hasn’t been a cakewalk.

Monetary experiments are being conducted. There is aggressively promoted social change, one that most people appear not to be aware of yet.

And crypto is in the thick of it.

Crypto advocates continue to criticize the current banking system and economic structure. A system that looks like it’s being dismantled before our eyes.

And yet, this system represents 400 years of financial innovations. Some of which crypto has reshaped for a distributed digital network focused on free interaction between people.

And 2020 gave us a picture of why this competition is so important.

The human experience requires more than just digital. It requires physical presence and connection.

And that means looking for a way to use digital to enhance our analog experience. And this means seeing the world as abundant, where people are no longer simply economic inputs.

Crypto is built on 400 years of financial and economic innovation

Money is the lubricant that makes the modern economy work. And the economy is supposed to serve people. And our modern economy is in part a byproduct of innovations from 400 years ago.

In 1602 the first formal stock, the Dutch East India Company, was created. The advent of the limited liability corporation has its origins here.

The size and scope of the company as well as the number of subscribers and eventually regular dividends, resulted in numerous financial innovations.

A liquid secondary market, although nothing compared to today’s standards, was one result. Dividends added speculative volatility to the price, which resulted in two things. One was forwards, and the other was the development of an options market.

The East India Company shares were so valuable that they could be used as collateral or even a form of money. The idea was taken to England in the late 1600s.

The Dutch had perpetual contracts dating back to 1624. Even the democratizing of finance through small denomination annuities and debt gave tradesmen the opportunity to invest. Yes, back in the 1600s. They also had the ability to create diversified portfolios.

The updated crypto equivalents are tokens, blockchains, DAOs with treasuries, DEX’s, derivatives, perpetuals, staking and collateralizing.

And in 1776, Adam Smith published his first edition of the Wealth of Nations. This work defined the core elements of our modern economic system. It could also be argued that Smith’s work formalized the idea of human beings as economic units in a vast system of capital driven by scarcity.

And this scarcity is a primary mode of thinking for everything we do in our modern financial interactions.

What all of these innovations contributed to is the idea of a vast industrial information system.

The original information system

The original information system is the human being who learns, develops, and shares information in various contexts.

Information is transferred through stories or symbols. Some are carved in stone, or written vellum, paper, and now through a digital device of some kind. Other learnings are shared through formal structures of teaching, mentorship, or something like a guild system.

Some believe that the entirety of the human experience is contained in our chromosomes and passed down from one generation to the next. Here, each of us is the steward of humanity through procreation and the exploration of our unique skills, attributes, and talents.

But this experience implies a relationship with others in a physical world, where we connect, share, and ignite insights.

Contrast that with lockdowns in 2020 and forcing everyone into digital immersion.

Removing these serendipitous and intentional physical human interactions between kids and adults alike affected mental health, lives, and relationships. We are still determining the impact as a society.

No doubt, the natural, informal information system was disrupted.

As we look around, things look the same but seem unrecognizable somehow. Our experience seems altered. Like something is missing.

Now we are told that many of us will face employment armageddon due to AI, the productivity enhancement tool. Our economic usefulness in the Adam Smith scarcity model has run its course according to some acolytes.

Of course, this means centralizing knowledge and its source. It means further centralizing money where control can be absolute.

Which begs the question, if an economy is meant to serve people, what do you have when people are classified as “redundant?”

The technology story

The story of technology is often about a thing and how it grew in adoption, domination and how it disrupted some paradigm of ideas.

The printing press opened up the world to thoughts, ideas, and literacy.

The horseless carriage led to the destruction of the horse-drawn carriage era on the way to the numerous benefits of the car.

The Wright brothers started what was to become a way to transport people and goods across the world with relative ease. Different types of energy opened up opportunities to make all of this and much more possible.

The postwar period led to the discovery of microchips and forays across every imaginable part of life.

Then the internet opened up a world of connection and information flows unlike any other.

Mobile devices took all that and put them on the road.

And then there was all that data…

In each step, it was not the technology itself that mattered initially, it was the way in which the technology shaped the way we saw the world around us. It was a shift in experience. A new way to connect and interact with others.

And this is a powerful thing.

Innovation also unleashed abundance for a wider number of people.

Money chooses what gets built

There is an argument to be made about who and where funding comes from determines what gets built. It means deferring to the judgment of the financiers, whether they be VCs or bankers.

Then there is the influence of government money which is directed to meet policy and propaganda goals. Here winners and losers can find themselves subject to perverse expectations and incentives.

The paternalistic element of finance can lead to layers of regulation to protect people from deciding what gets built, even if they have unique and expert insights. The goal, according to the regulation, is to protect the consumer. They want to be sure that the unaccredited are able to absorb losses but forget that this decision exposes them to the loss of potential future gains.

In the words of the social transformers, crypto is driven by equality rather than equity.

This is how innovation can advance in its unique haphazard way leading to remarkable discoveries.

What is missing is the human-focused alternative to Adam Smith’s world of scarcity.

The narratives of crypto

Crypto narratives are often bombastically focused on disrupting finance, replacing banking, and taking control of money from the government and returning it to the people.

The solution is an information system delivered in a software package that leverages decentralization, incentives, and networks to empower users.

Control of money is a pretty significant aspect of governance. It is the source of trade and taxation. The source of power and influence. And at the extreme, the steroids for metastatic growth of authority.

Now challenging money with bitcoin wasn’t a big deal in 2009. But 24,000 crypto experiments by free-thinking people later, and without the direction and input of the government, now, that might be a problem.

But once you have the money part figured out or, in the process of figuring it out, now it’s time to think about the economic model.

Because there seems to be a movement to an all-digital future. One like we had in 2020 and longer in some places. One that divides people from one another. One that seems to emphasize human beings as things to be cared for and managed by the state.

In this model, we are consumers with universal basic income hooked up to the Borg.

And that begs the question of whether crypto can be used to create an economic vision that enhances our analog experience.

The world of abundance

Author George Gilder has noted many times that as the population of the world has grown, so too have the resources. The reason he says is that knowledge is wealth. And when you have all those minds working on problems, lots of solutions are discovered and implemented.

Which would seem to be a challenge to the concept of scarcity.

Indeed, David Martin has argued that scarcity is a way of defining resources so that it invites conflict to obtain them.

Which makes you wonder why some want to tokenize everything in the natural world.

Adam Smith’s conceptual idea is that we live in a world of scarcity. And that scarcity drives everything into a system where everything is reduced to a measurable element. In this system, we are dehumanized into mere economic units of an industrial production process.

Things to be digitized, categorized, and controlled.

Or, we could consider the possibility that the 400-year-old monetary experiment we appear to be concluding means a change in thinking.

A change in our outlook.

What if we saw ourselves living in a world of abundance?

How would our experience of the world change if we focused on our capability as producers rather than consumers?

How can technology enhance our analog human experience?

And what would the implications of this be on our economy, governance, and future?

All we have to do is be willing to open our minds and do the work.

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Bitvo is a crypto trading platform regulated with FINTRAC as a Money Services Business and as a restricted dealer with the Canadian Securities Administrators.

Originally published at https://bitvo.com on May 15, 2023.