Bitcoin & the HOPF Cycle of the Internet

Bitcoin Times Edition 3

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It always starts with a meme…
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Strauss-Howe Generational Theory. Matrix.

Internet Memes Applied To The Internet

It could be interesting to try and apply this model to the Internet itself, and see if we can get any suggestion out of it for the technological tools that have been developed during the last half of a century, and for the ones that are being developed now, particularly in connection with Bitcoins.

Hard Times create Strong Tools

It should be uncontroversial to state that the invention of the TCP/IP protocol suite, with its fundamentally decentralized and “apocalypse- resistant” design, was at least partially driven by the adversarial mood caused by the Cold War, and the pervasive nuclear scare.

Strong Tools create Good Times

It’s arguably fair to state that the general optimistic mood which characterized the end of the twentieth century was at least partially driven by the success of the Internet in connecting the world. While most of the reasons for talking about the “end of history” were geo-political in nature (the collapse of the Soviet Bloc and the so-called “Pax Americana”, which was not without its fair share of sanguinary wars), technological tools were also instrumental for the creation of that triumphant exuberance: the commercialization of the Internet, following the December 1994 release of Netscape Navigator and the NSFNET selling all its assets in 1995, generated huge expectations. Soon enough the entire financial market was cannibalized by the so-called “dot com” bubble in the late ’90s. The rate of technological and scientific innovation accelerated hugely, and the wave of “Internet Optimism” overflowed from the stock market into culture, literature, art, entertainment, and society in general.

Good Times create Weak Tools

With the new millennium, the “dot com” bubble finally burst, but the Internet was here to stay, changing the world economy and our lives for good. From the ashes of many shameless money-grabs, actual technological giants emerged, replacing most consolidated industries at the top of the stock markets and shaping the “new economy”. But the lazy reliance on convenience and trust and the absence of adversarial thinking contributed to the weakening of the Internet infrastructure. Everything became more centralized and trust-based, thus more efficient, but also more fragile.

Weak Tools Create Bad Times

This centralization process was not without advantages. A lot of people have access to the Internet today, even in the most remote places. Even people who could be considered deeply impoverished have smartphones. Everything is faster, cheaper, and simpler than ever, with more and more features accumulating every year. But all this came with a cost. Centralization usually brings along serious risks of monopolization, corruption, exclusion and abuses. Indeed, today we are very easily censored, blacklisted, tracked, spied upon and watched every time we use the Internet. The political risk of scary Orwellian drifts is not even theoretical anymore: we really live in a world where crime-exposing journalists like Julian Assange, or peaceful e-commerce innovators like Ross Ulbricht, are literally imprisoned (often for life, and often employing methods that resemble torture very closely) for the way they used the Internet. While almost everybody has a smartphone, almost nobody is free to use it in a secure, open, unrestricted, and privacy-preserving way, and most people are excluded from the Internet-based commercial and financial infrastructures due to “KYC” political restrictions.

Lessons for Bitcoin

The circle closed again: Bitcoin, which can be considered the “value layer” of the Internet (even if it represents in some sense an innovation which is way deeper than the Internet itself) has been created to mitigate and overcame these “Hard Times” made of Internet censorship, digital surveillance, financial exclusion, virtual money-manipulation.

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