A Reasonable Demonstration That Peter Schiff’s Founding Argument Against Bitcoin is Null
Peter Schiff’s argument always, always, always falls back on the same point, which is rhetorically summarized in the question: “what can I do with my bitcoins, other than send them to somebody else?” (Just watch his debate against Saifedean Ammous on YouTube, you will see that all arguments eventually lead back to the same question of the utility value of bitcoin units.) The question is meant to imply that Bitcoin is like fool’s gold because gold has utility value separate from its exchange value, whereas bitcoins do not. However, the question fails to do so because it is a loaded question. Here is the explanation:
The question, “what can I do with my bitcoins, other than use them to send to somebody else?” assumes that the bitcoin units are separable from Bitcoin the protocol, and/or it assumes that the existence of bitcoin units is independent from the existence of Bitcoin the protocol. This is as ludicrous as assuming that the existence of H2O is independent from the existence of water. Yes, the units of bitcoin are essentially computer bits, just like the units of water — H2O — are essentially electrons and quarks. But it is the specific composition of these quarks that makes them Hydrogen and Oxygen nuclei, and it is the strict adherence to a specific blue-print that makes the H, O, and electrons H2O and thus water, just like it is the specific composition of the bits in the computer that makes them represent numbers and letters, and it is the strict adherence to a specific protocol that makes those numbers and letters bitcoins and thus Bitcoin. Said another way, just like the electrons and quarks are only H2O by following a specific protocol, the bits of the computer are only bitcoins by following the Bitcoin protocol. Therefore, to make any reference to bitcoins, or the utility/value of bitcoins, as a separate entity from Bitcoin, or the utility/value of Bitcoin, is as ludicrous as making a reference to H2O, or the utility/value of H2O, as a separate entity from water, or the utility/value of water. One cannot logically argue that the bitcoins have no value but the protocol does have value because they are as inseparable as H2O is inseparable from water. If H2O has value for the same reason that water has value, then bitcoins have value for the same reason that the Bitcoin protocol has value.
Therefore, the question “what can I do with my bitcoins, other than use them to send to somebody else?” is a loaded question, because it is smuggling in a non-existent reference. It’s as if Schiff asks, “What can I do with my H2Os, other than use them to be water?” as if H2Os are separable from water — that reality just does not exist. Therefore, that line of reasoning is exactly null. (In Peter’s defense, the failure of his rhetoric is likely not caused by a flaw in his reasoning. Rather, I think it is rooted in a lack of understanding, or a misunderstanding, of Bitcoin technology and, perhaps, computer technology in general.)
Therefore, the only inquiry of value must be directed toward the protocol itself. The only rhetorical question that Schiff can reasonably provide is, “what can I do with Bitcoin (the protocol)?” To which the answer is simple: “you can communicate with other Bitcoin users according to the protocol.” The expected reply from Schiff would be, “why would I do that?”
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“Why would you drink water?”
