# Opening statement: Bitcoin is good for the world

## 1\. Introduction

Close your eyes.

When you open them, you will be someone — one of eight billion people alive today — but you don't know who.

You might live in a developed country. You might be a farmer in Venezuela or a digital nomad on a beach. You might live under authoritarian rule. You might be a Canadian mother who scrolls social media in bed, or a Nigerian man struggling to get ahead. You might even be Belarus President Alexander Lukashenko, or Swedish guitarist Yngwie J. Malmsteen. The institutions around you — elections, commercial or central banks, hospitals, schools, police, regulators of contracts and markets, media outlets, places of worship and culture — may be wisely governed. Or not. It all depends on where you land.

There are possibilities here. Approximately eight billion of them: one per human life. Some are pleasant and easy to take on; others more difficult. 

To open your eyes is to take a risk, to bet it all on an eight-billion-sided die. Luck is a storm; it will guide your boat to one shore or another.

When you open your eyes, not knowing who you’ll be, would you want to find yourself in a world with bitcoin, or without?

You may have no opinion. Bitcoin is complicated, and getting a handle on it requires expertise spanning technology, politics, economics, and philosophy. Reasoned views here come only by way of hard intellectual labor, and put us in danger of intellectual trespassing.[^1] Absent such labor, withholding judgment seems good and right.

In this opening statement, though, I’ll present evidence on behalf of a positive answer to our question: should we want to wake up in a world with bitcoin or without? My core claim is that bitcoin makes the world better, and that taking a suitably neutral perspective, as in the thought experiment above, is helpful in appreciating how bitcoin does this work. My thesis is not that bitcoin makes *your* life better. It is, rather, that bitcoin makes human lives better by giving us a way to weather the storms of luck.[^2]

Toward this end, I will advance three arguments, which may be adumbrated as follows:

Argument 1: Bitcoin is useful. Bitcoin does something for its users. This claim should be partly unsurprising; after all, people use bitcoin. They run the software that sustains the bitcoin network, send bitcoin to each other, add transactions to the ledger (this is what miners do), and so on. Users and developers give up something of value here — their time and life energy, resources, and associated opportunity costs. Such activity evinces a revealed preference. Bitcoiners are getting something here. But what? My answer in one word: exit. Bitcoin provides its users a digital money beyond the reach of banks and other corporate and state authorities.

Argument 2: Bitcoin is special. Digital money is not new. Billions use digital money every day. What makes bitcoin special is not that it is digital, but instead that it removes trusted authorities who produce money, hold it on behalf of users, or facilitate transactions. Removing intermediaries is what sets bitcoin apart, and what makes it uniquely useful as a tool of resistance. Where alternatives like gold, cash, or various cryptocurrency fads falter, bitcoin stands apart.

Argument 3: Bitcoin is good. Something may be useful but only for bad ends. Is it actually good for the world that there is a uniquely useful tool of monetary resistance? Should we want to live in a world where people can exit from local monetary institutions? My third argument addresses these questions. I’ll show that the exit bitcoin provides its users is good for them and for the world. A driving theme is that trusting institutions to fix themselves is naive, and building voluntary alternatives is an inviting solution in the permanent meantime.

Thus, my core thesis, and three arguments I’ll give on its behalf. The rest of my opening statement will unfold as you might expect. I’ll explain the arguments in turn, present conceptual and empirical evidence on behalf of their premises, and show how the arguments together support my core thesis. But before doing any of that, I want to say more about how to think about our topic.

## 2\. Setup

How shall we approach the questions at hand? By what standards are we to evaluate bitcoin, and from which perspective? How can we overcome the biases that afflict us here? For bitcoin isn’t a mere theory. It is a technology and a money. As with truck drivers and autonomous vehicles, hotel operators and short-term rental schemes, or asylum-seekers knocking at the door and the immigration policies that await them, personal interests threaten to overtake sober thinking. It is all too easy to replace the question of this volume, whether bitcoin is good for the world, with another: whether bitcoin is good for *you*. This is a problem.

### *2.1. Financial bias*

For those who buy bitcoin — going long, as they say — and who wish to see the value of their holdings appreciate, one temptation is to become a booster: to say good things about bitcoin, to encourage investment, to downplay harms, or to overstate benefits. For those who sell bitcoin — going short — and who wish to see the value of their bets against bitcoin appreciate, one temptation is to troll: to say bad things about bitcoin, to discourage investment, to overstate harms, or to downplay benefits.

In addition to bare financial interests, institutional affiliations impose other biases. Central or commercial bankers, whose livelihoods or authority depend on the use of monetary products or services their employers offer the public, have a strong incentive to downplay bitcoin’s benefits. Bitcoin is the competition, and no one wants to say the competition is any good. Bitcoin software engineers, miners, or other industry players, similarly depend on the public’s use of their products or services, and thus have a similarly strong incentive to overplay bitcoin’s benefits.

### *2.2. Reputational bias*

More subtle biases nibble at our credibility. Bitcoin is no spring chicken. It’s nearly two decades old by now. Across those decades, pundits pro and con have said much. Some issued bullish predictions about adoption or purchasing power: that bitcoin is inevitable, that it will supplant all other monies, that a single bitcoin will be worth a million US dollars in short order, and so on. Some issued bearish predictions: that bitcoin’s demise is inevitable, that any use will dry up, that a single bitcoin will be worth zero US dollars in short order, and so on. The prognosticator’s bias is not strictly financial. It is reputational. Once you’ve planted your flag, you have a vested interest in seeing your bullish or bearish predictions come true. Cognitive goggles come easily enough: these filters help you see every news item as a vindication of what you’ve already said, and an opportunity to help make your own predictions come true by influencing public opinion. Even when you’ve not made a financial bet for or against bitcoin, punditry puts you in the position of being reputationally long or short, with all the biases such positions entail.[^3]

The problems here are hard, and by no means unique. Biases are everywhere, and not without their uses.[^4] Pundits everywhere are tempted to don cognitive goggles and use them to filter out information that would disconfirm past pronouncements or highlight information that would confirm them. Pundits everywhere do their best to influence public opinion, and massage the future into compliance with their predictions. Fear of backlash and condemnation only enhances these biases. It is very hard to admit you were wrong, and changing one’s mind in public comes at a great price.

What can be done? Is there any hope for human beings to actually figure things out, rather than merely entrench the biases we already have?

Noticing our biases is a good first step. So also, announcing that we wish to overcome them. If you’ve gotten that far, you’re already doing better than most. But mere words, and even stout resolutions to abide by them, are not enough. We must actually do something to mitigate our biases.

### *2.3. Mitigating biases with a veil of ignorance*

To see past our own financial or reputational interests, we need a method that invites us into impartiality. And we need to stick to it, both in the questions we raise, and in the way we answer them. Here is my proposal. We should evaluate the world, and bitcoin’s place in it, from behind a veil of ignorance.[^5]

If you’ve read the introduction, you already have a feel for what this means. But let’s be more precise. The idea is this: hold on to what you know about the actual distribution of resources, the way institutions succeed or fail, and even your own values — what you think is good or bad, and relative rankings of goods or bads. Hold on to everything you know about the world, in fact. Except for this: your own place within it. Forget for a moment who you are. And then ask this: assuming you are somebody, but not knowing who that somebody is, do you want bitcoin to exist? A positive answer is a powerful point in bitcoin’s favor, when it comes to our titular question. And a negative answer, a powerful point against.

### *2.4. Advantages of ignorance*

The benefits of this procedure, and the ignorance of identity it recommends, are threefold.

First, it allows us to think about bitcoin’s effects without succumbing to crude aggregation. My suggestion is not that we should catalogue bitcoin’s benefits and costs, sum them up, and be done with it. We need closer attention to who pays those prices or reaps those rewards. Is it the least well-off? How many? The most well-off? How many? Which benefits or costs spill over and accrue, not just to users, but to everyone, and what is their magnitude?

Second, it gives us a vivid way to abstract from ourselves. Of course abstraction from self is, in one sense, not possible at all. You are still you, and couldn’t have been anyone else. But you can use your mind to take on other perspectives as if they were your own, and counterpossible imagination of this kind can help us see beyond our own contingent and immediate circumstances. I do not ask you to set aside your own values. It would be an abuse of abstraction to pretend that what you think is good is actually bad, for example. I ask you, instead, to hold fixed your values, but let go of who you are, and inquire as to what opinions you’d have about some concrete technologies, given this fresh perspective. The abstraction I recommend does not eschew self-interest altogether. For the question I want you to ask — “Would I want bitcoin to exist, or not, not knowing who I’d be?” — is still to be approached from the question of who bitcoin harms or benefits, with the understanding that you might well turn out to be one of those people. We haven’t erased you from moral reasoning altogether, as it were — just your identity.

Third, the procedure facilitates lucid reflection on risk. Imagine, as at the outset, that you are rolling an eight-billion-sided die, one for each person you might be. What are the odds you’ll be someone who lives under wisely operated institutions? These will be set by the actual contingent facts about democracy, good rule, and wisdom, and their global distribution. What are the odds you’ll suffer under censorial masters, eager to snuff out opinions they find dangerous? These will be set by the actual contingent facts about liberal norms, corporate control, and state overreach. 

Evaluating a technology — and bitcoin is just one technology to which we can apply this procedure — should never be a matter of pure theory. Our business is partly empirical, and should take into account the way that technology is actually used, its various consequences, in context. Because it preserves knowledge of everything but identity, our abstraction technique allows us to do just this. It is placed at a pleasing mean: neither too abstract (as when ignoring all the contingent facts about resources, institutions, or use) nor too concrete (as when evaluating only from one’s own perspective).

What stance towards risk do you take, when reasoning from behind this veil? Only you can say. Here is my answer. You may borrow it if you like.[^6] I am risk-averse. I place a premium on avoiding catastrophic outcomes. When bitcoin’s presence makes those outcomes more bearable, or gives their subjects an exit option, bitcoin is more precious. And our procedure allows us to take on this stance without a wider commitment to more controversial views in value theory, such as prioritarianism or egalitarianism. If bitcoin can help mitigate truly disastrous outcomes, as when assisting in exit from repression or oppression, this benefit deserves special attention and weight for the risk-averse individual. Saving some of us from disaster — even when those saved are few in number — is a powerful point in bitcoin’s favor.

Of course I haven’t made the argument yet that bitcoin in fact has these effects. That will come in later sections. The point is that, should the facts cooperate in the way I’ve suggested, we should, if risk averse, give these facts significant positive weight in a cumulative evaluation of bitcoin. When making the call for all of humanity whether bitcoin is to be or not to be, unlikely but calamitous outcomes take on extra urgency.

Another way to see the point here is in terms of so-called ‘tail risks’. The fool says in his heart: “These disasters don’t happen often, and so I can disregard them in my deliberations.” But this is bad math, and worse risk management. Navigating an uncertain world requires paying attention even to unlikely risks of catastrophe, and taking steps to avoid them.

If you are not risk-averse in this way, the preceding remarks about risk will not directly apply to you. But the veil thought experiment is still helpful, in taking our attention away from our own perspectives, and thinking about bitcoin’s broader effects.

A final note on the questions and how we are to approach them. Idealization — thinking of what bitcoin might be, what it could do, what is in theory possible — is tempting. But this sets the bar both too low and too high. Too low: theorizing without pragmatic constraint gives proponents too free a hand in speculating about bitcoin’s promises, and disconnects discussion from reality. Proponents dream big, and speculate about bitcoin becoming a dominant global money. But this is a dream, and we’d do well to look at the facts, instead, and what bitcoin does for humanity here and now. Too high: fantasies can be inspiring. But we should not accept them as a baseline when assessing whether bitcoin is good for the world. We shouldn’t hold any technology to that standard: not chatbots, not the automobile, not fire or the written word, and not bitcoin.

Thus, I will focus, not on hypothetical scenarios in which bitcoin takes over the world of money, but instead on what bitcoin actually does in reality as we know it.

We are now ready to raise, in full seriousness, our target question: is bitcoin good for the world? Or: not knowing who you are, would you want bitcoin to be in the world?

## 3\. Bitcoin is useful

### *3.1. Bitcoin is a tool*

A tool is useful when it helps people solve problems. I will argue that bitcoin is useful, accordingly, by highlighting two problems, and then showing how users deploy bitcoin to mitigate them. The short version is this: the presence of trusted authorities in a monetary system imposes risks on users: of bad monetary policies or institutions, of insolvency or confiscation, or of outright blockades and payment censorship. In routing around these authorities, bitcoin provides its users with an exit option, and a way to manage these risks.

The ‘bitcoin is useful’ argument I will develop draws attention to what we might call the primary uses of bitcoin. Much punditry on bitcoin skips this primary use altogether. One impulse there is to immediately jump to secondary use — as when buying bitcoin to speculate on its future usefulness to others. Or perhaps to tertiary use — as when making bets on others’ buying of bitcoin to speculate on its future usefulness to others. But skipping primary use is a mistake and we’d be wise to understand, not just why someone would bet on bitcoin, but why someone would use it in the first instance.[^7]

If you’ve looked at the news about bitcoin, you’ve probably noticed that it is transfixed by bitcoin’s purchasing power, or price in US dollars. It’s up. It’s down. It’s sideways. An analogy can help us think about such market reports in connection with bitcoin’s primary use. Boats are useful. They float. But not everyone needs to float, and so boats are only a useful tool for some. Despite that limited use, it is not surprising at all that boats have a non-zero market price, and that even people far from the water might want one. Even if you didn’t need to float yourself, you might have views about the future of floating, or buy a boat on the conviction that something that is limited in supply, costly to produce, and useful for others, is a useful investment. Bitcoin is like this. It is, as we’ll see, useful. And it is not just costly to produce and limited in supply, but strictly limited — capped at 21 million units. Demand for the utility bitcoin affords its users blows around like the wind, and reacts to a million macro-economic, social, and political factors. So too various secondary markets and their higher-order bets on demand for bitcoin. So bitcoin’s purchasing power, too, blows around like that wind. Understand this, and you understand bitcoin’s secondary markets — people who buy or sell bitcoin, bitcoin derivatives, ETF shares, bitcoin treasury companies, and so on.

### *3.2. Trusted authorities*

Before we can state the problems, let’s identify and distinguish three kinds of trusted parties in monetary systems: makers, managers, and mediators.

#### Makers

We rely on trusted parties to produce the monies we use, whether physical or digital. Central banks like the Monetary Authority of Singapore or the Federal Reserve — or associated entities like the United States Department of the Treasury — produce and distribute cash. Commercial banks produce the digital money in user deposits. And financial services produce claims to commercial bank money represented in their user deposits. We outsource to makers, and trust that they will do their work judiciously.

#### Managers

Unlike physical cash, you cannot hold a commercial bank balance yourself; instead, you have an account with a manager who does it for you. The same is true for many digital monies and financial services you know best: PayPal, Venmo, Zelle, M-Pesa, Wise, Western Union, PayLah, Revolut, Swish, Alipay, GoPay, GrabPay — the list goes on. In none of these cases do users take direct control of their money themselves. Instead, they outsource that task to custodians. We trust managers to look after our money wisely.

#### Mediators 

Unlike cash, you cannot transfer a commercial bank balance directly to another user. The same is true of the financial services noted above. Instead, a network of banks and financial services or mediators does that task for you. Money hops from one node in the network to another — debited from this account, credited to that one — until it arrives in the ledger of another entity. We trust mediators to transfer our money correctly, without accounting mistakes or leakages.

When all goes well, makers, managers, and mediators are a boon. They’re the experts, and do their work far better than users could on their own. But sometimes all does not go well. The fact that this happens, and the risk that it might, creates two problems.

### *3.3. The problem of monetary luck*

Central banks — makers — are trusted to create neither too little nor too much money. In managing interest rates, deposit ratios, and quantitative easing or tightening, they aim instead at a goldilocks zone. Not enough money in circulation? Cooling economic conditions? Lower interest rates. Print. Too much money? Give those rates a hike, stop the printers, and hope things cool down. It’s a high-stakes game, and some play it well. Others are not so skilled.

You may not suffer the consequences of subpar monetary institutions or policies. But it’s a serious problem across the globe. Let’s look at a few cases from just one part of the world, and then see the general problem they evince.

The Central Bank of Lebanon has a history of unwise policies and corruption. Indeed, officials have even embezzled hundreds of millions of dollars and invested reserves in scams. To cover up their misconduct, they printed so much of their own money that the Lebanese pound lost 98% of its value.[^8] Locals took the hit; life savings, money for groceries or school, gone. Annual inflation to this day runs hot — 14.8% — and the Lebanese pound is a melting ice cube.[^9]

Not far away, the Syrian pound faces similar woes. Its makers printed that scrip into oblivion — with trillions now in circulation — and the result is exactly what one would predict, a 99% loss in purchasing power since just 2011\. While local makers scramble to deal with the aftermath of their poor policies, families are left hauling massive bags of banknotes just to do their shopping.[^10] 

Across the last half decade, Turkish money has taken a beating, with the lira losing 50% or more of its value annually. They keep making more. With so much money in circulation, nominal prices skyrocketed, and “... basic staples like cheese and morning pastries transitioned from everyday goods to ‘distant luxuries’.”[^11] The Central Bank of the Republic of Turkey has done its best to clean up the mess it made, hiking interest rates past 50%. But these reactions, too, create problems — a “...lost generation of children who have been forced to grow up too quickly to help their families eke out an existence.”[^12] Bad policies make hard times worse.

This is what trust in makers looks like when misplaced. And the problem here is much more general than just these few cases.

In the wake of COVID-19, central banks across the world hit the big green button: quantitative easing, near-zero interest rates, and so on. Money sloshed around like vodka at a festival. Some got rich. And with markets drunk on liquidity, global inflation surged — more money chasing fewer goods and services.[^13] At its most recent peak in 2022, some 69 economies suffered under “confirmed double-digit inflation, representing more than 2.1 billion” people.[^14] But though the lucky ones among us may exhale in relief now — COVID-era inflation in the developed world has been reined in to some extent by subsequent policy adjustments[^15] —  double-digit inflation is still the rule in 10 countries in Sub-Saharan Africa.[^16] Annual inflation in Venezuela clocks in at 682%. Sudan, 54%. Iran, 41.6%. Myanmar, 28%. I could go on.[^17] Very bad inflation is a basic fact of life for about a billion people today.

My claim is not that central banks are fully responsible for all of this inflation. But their policies make it worse, and work in tandem with other bad institutions to create bad outcomes. Desperate, corrupt, or war-torn states run massive deficits and force captive central banks to monetize debt through monetary expansion (producing more money). The very presence of trusted makers creates the risk of mismanagement along these lines. And so it is a fair guess that what has happened before — global disaster striking, central banks responding as best they can, with many failing badly — will happen again.

Here, then, is the problem of monetary luck. Roll that eight-billion-sided die. Where will you land? In a place ruled by wise makers, who judiciously contract or expand the money supply to hit their modest inflation targets? Or will you fall among the billion people stuck under bad policies and institutions? The odds here are not good, from a perspective of risk management. A one-in-eight chance of catastrophe is too much, one thinks. Risk-averse or not, you’d want an alternative.

### *3.4. The problem of censorial institutions*

You may not have seen your lawful payments censored. Your own peaceful use of money may be unmolested by corporate or state authorities. But it’s a problem across both the developed and developing world. And its root cause is this: trusted managers and mediators have the power to seize or blockade digital monies as they see fit. Many support liberal values in word — freedom of thought, of speech, of association, of religion — but trusted institutions and their abuse of power tell a different story.[^18]

Sometimes censorship of lawful payments stems from governments. In the United States, President Obama’s Operation Choke Point targeted firearms dealers, pornography merchants, payday lenders, and other lawful but politically disfavored firms with payment blockades or outright debanking. Under President Biden’s White House, Operation Choke Point 2.0 continued in a similar vein.[^19] When President Trump — husband to Melania Trump, herself a victim of debanking — recently accused Bank of America of blocking conservatives from its services, its CEO blamed Biden-era regulators and over-zealous enforcement of anti-money-laundering and know-your-customer rules.[^20]

Despite the political valence here, the core phenomenon isn’t partisan. American Senator Elizabeth Warren conceded that “Donald Trump was on to a real problem when he criticized Bank of America for its debanking practices”, though she blamed the bank itself, rather than its regulators.[^21] Other Democrats fear, not for no good reason, that Trump’s second administration will block payments for or debank abortion and gender clinics, left-wing non-profits, universities, or other politically disfavored outfits. All agree that regulator-led debanking of lawful and peaceful enterprise remains a potent political tool for those willing to use it.

Another kind of censorial blockade stems, not from the behest of public regulators, but from private firms acting on their own, as when commercial banks, payment processors, or other big finance firms block access to law-abiding users.[^22]

Patreon bans payments to content creators who represent ‘Dangerous Organizations’ or who spread hate. Support a disfavored conspiracy theory, even on another platform? You’re out.

Stripe is the largest privately-owned fintech firm in the world and processes an appreciable fraction of all internet payments: about a trillion dollars a year. Whether you know it or not, you’ve probably used their services. And like all big tech firms in the payments business, Stripe maintains a long list of lawful industries and products its platform does not permit: timeshare services, hydroponic equipment designed for growing marijuana, telemarketing, toy weapons, bankruptcy attorneys, and more.

In 2022, PayPal apparently threatened to block transactions involving the promotion of ‘misinformation’, and even to impose fines of up to $2,500 for those thought to be guilty of such.[^23] Despite withdrawing portions of that ban due to backlash (they said it was a mixup; skeptics were skeptical), PayPal to this day prohibits lawful payments associated with racial intolerance, medical devices, obscene content, tobacco products, and more.

One may be forgiven for thinking that it is bad to spread misinformation or racial intolerance, to sell tobacco products, to donate to dangerous organizations, or to spread conspiracy theories. These activities are indeed politically disfavored, and distasteful to many. But these activities are legal in the United States, where Patreon, Stripe, and PayPal are domiciled. 

And the fact that these firms are private does not in any way show that their rules do not constitute a kind of censorship. As J.P. Messina has convincingly argued, ‘private censorship’ is a coherent and useful category, and many of the usual arguments against state censorship apply to large firms as well.[^24] A libertarian retort is that these actors are private, and no one is forced to use their platforms or services. But when corporations span borders and cooperate to bring about their blockades, the retort rings hollow. We rightly worry when powerful states decide what constitutes ‘misinformation’, which organizations or causes are ‘dangerous’, which kinds of facts or theories may be shared, and so on. We rightly harbor similar worries about powerful corporations, and whether they should be empowered to decide who may engage in payments.

The point here is not value-neutral; fascists, communists, and other authoritarians tend towards enthusiasm about using either public or private means to block dissent, after all, so long as they are the ones in power. But liberals, broadly construed — I mean people who value freedom of thought, of expression, of religion, and so on — have good reason to be alarmed at the powers we’ve handed over to the trusted managers and mediators who control our digital monies. Using their systems is risky.

The problem here is not limited to the United States. Across the globe, local authorities abuse their status to blockade human rights activists, dissidents, religious minorities, and other peaceful or lawful but politically disfavored outsiders.

In 2025-2026, the Museveni regime in Uganda froze bank accounts for human rights organizations, including Chapter Four Uganda, the African Institute for Investigative Journalism, and the Agora Centre for Research.[^25] In 2025, Georgia froze the bank accounts for seven civil society organizations.[^26] In 2025, Iranian authorities seized accounts and assets from members of the Baha’i faith, a religious minority, following a “... long-running pattern of property seizures against Baha’is since the 1979 Islamic Revolution.”[^27] Daniel Ortega and Rosario Murillo’s dictatorial regime in Nicaragua regularly deploys monetary blockades to block dissent, the development of civil society, and even charity from the Catholic Church, leading to the closure of some 5,400 non-governmental organizations.[^28]

I could go on. Every week, new examples emerge of state and corporate authorities stifling dissent by blockading payments and banking. And it makes sense, as a matter of strategy: without access to money it is very hard for journalists, whistleblowers, or human rights activists to do their disruptive work.[^29]

You may be surprised to learn all this. Financial censorship is not widely reported in the press. Why? Conspiratorial explanations are easy; people in power rarely want to be called out for their abuses. But I see another problem. It is that censorship is a “no-see-um”. Some phenomena are easy to spot. They are visible, and when present, highly detectable. Were there a manatee in the quad, you’d know it. And so seeing no manatee, and hearing no news of manatees, you may reliably conclude that there are indeed no manatees in the quad. Manatees are see-ums: if there, you’d see um.

“No-see-ums” — a colloquial name for *Ceratopogonidae* sandflies just one or two millimeters long — by contrast, cannot be so easily spotted.[^30] Look out across the delta, and you might think it’s a fine day to traipse through the water. Bad idea. They’ll swarm and eat you alive. No-see-ums are invisible to privileged outsiders, but painful for those on the ground. Because they are invisible, an inference from “I don’t see um, so they’re not there” is invalid, and a disaster when deployed in action.

Censorship is like this. It is hard to spot. The inference from “I don’t see it, so it’s not there” is therefore invalid. Consider various online messages, posts, payments, or other transactions: would censorship of such be easy to spot, if present? By design, not. For censorship consists in absences — blockades, deletions, unspendable funds, unsendable messages, and so on — and absences are by nature and design hard to see. Censorship is hidden to privileged outsiders even when present. But like the *Ceratopogonidae* flies, it is no less harmful to those it assaults.

Here, then, is the problem of censorial institutions. Roll that eight-billion-sided die. Where will you land? In a place ruled by liberal institutions, tolerant of disfavored but lawful enterprise? Will corporate authorities be kind to your unhinged but lawful conspiracy theories? Or will you end up in the United States, or Uganda, or Iran, or any number of other places, where economic support of your peaceful activities is blocked, censored, or even met with prison time? And even if your local authorities are as liberal as they say they are, there is no guarantee they’ll stay in power, or do as they say. The very presence of trusted monetary authorities imposes a risk of losing it all.

### *3.5. How bitcoin helps*

These problems stem, not just from bad policy, but bad institutions. When central banks fail in a core mandate and inflation runs amok, when corporate or state authorities censor dissent, tinkering on the margins is unlikely to help. For it was the presence of these institutions, and the fact that they were entrusted with power, that created the problems in the first place.

When institutions fail us, what shall we do? A familiar framework — loyalty, voice, exit — is helpful here.[^31]

Loyalty is always an option. You can simply accept the cards you’re dealt, and hope for the best. Or you can exercise voice, as when voting in new leaders, or trying on different market offerings. Some think these options suffice. “Unsatisfied with your monetary rulers? Vote in new ones. Unsatisfied with financial services big tech provides? Build new ones, or pay someone else to do it.” Thus speak the optimists. But realists suspect that workable market alternatives and functional democratic rule are the exception, not the rule. And turning to them for solutions is Quixotic when democratic or market institutions created the problems in the first instance.

Look again at central bank failure and its source: trust. Asking policy-makers to tinker more cedes to them the very powers that make their existence a risk for users. The power to tinker is itself dangerous.[^32] As Milton Friedman wrote:

… few things are harder even for knowledgeable non-experts to accept than the proposition that twelve (or nineteen) people sitting around a table in Washington, subject to neither election nor dismissal nor close administrative or political control, have the power to determine the quantity of money – to permit a reduction by one-third during the Great Depression or a near doubling from 1970 to 1980\. That power is too important, too pervasive, to be exercised by a few people, however public-spirited, if there is any feasible alternative. There is no need for such arbitrary power.[^33]

Friedman’s target here is the American Federal Reserve system, which is supposed to be politically independent, and therefore insulated from the ever-shifting winds of electoral opinion. It implements the idea that we are to trust technocratic experts with the task of the maker. Can we do better by turning the task over to the crowd? Would more democracy, as it were, help? One thinks not. Asking ordinary voters — or Presidents, Prime Ministers, or Members of Parliament they elect — what the interest rate shall be next quarter, for example, is a recipe for worse monetary policy, not better.

More importantly, an appreciable fraction of the globe lives under the boot of authoritarian rule. Insisting that democratic process will save us is, I submit, unrealistic and unfeeling. When free and fair elections are not a reality, and where the few rule the many, one cannot vote one’s way out of a mess.

And so we turn to a third option: exit.

Immigration is one way to exit. In emigrating, one leaves behind bad schools, bad police, bad monetary institutions, bad elections, and so on, and hopefully towards more promising institutions. But immigration is costly, and impossible for most. Leaving behind family and friends, securing a visa, building a new life in a new land, all of this comes at a great price.[^34]

Wouldn’t it be nice if one could exit a bad institution, without emigrating? It would indeed. And exit without emigration is what bitcoin provides.

To run the bitcoin software, to use bitcoin as money, to trade lira or pounds for bitcoin, is to exit a familiar system for a different and quite strange one. Where other systems are defined by trust in authorities and wide discretion over monetary policy, bitcoin is defined by code and fixed policies. 

Bitcoin’s monetary supply is governed by a strict schedule, and capped.[^35] As new transactions arrive on the network’s ledger, new bitcoin is minted along a predetermined path, without leeway for discretionary manipulation, emergency powers, or new supply shocks. Minting new bitcoin, furthermore, is costly on the margin. Where bills or bank deposits can be printed on the margin for free, miners pay for the bitcoin they add to its ledger in the form of electricity and chips. This non-zero cost of production further sets bitcoin apart from the digital and physical monies we know best.[^36]

One may run whatever software one likes, of course. But to participate in the bitcoin network, one must run software compatible with its rules. And so the equilibrium outcome is that all users converge on, and together enforce, extant fixed policies. Discretionary defection, as when running a program that prints more bitcoin than expected, or assigns all new bitcoin to oneself, is no more viable a path for an individual than is assigning idiosyncratic meanings to all your linguistic utterances, and hoping others will play along. To participate in a linguistic network — that is, to understand and be mutually understood — you have to follow its rules. So also with bitcoin. A vast network of users, in this way, enforce the rules themselves. Instead of trusting authorities to exercise discretionary powers over monetary policy wisely, bitcoin users verify: your own node software checks for itself that each transaction is valid, and that it obeys the rules.

I do not say that the resulting system is trustless. But what is trusted is not the good will or wisdom of a monetary ruler. The object of trust is instead a cluster of mathematical operations, enacted in code, and enforced by the game theory of a distributed network of nodes.[^37]

I also do not say that bitcoin is democratic money. It is, rather, the ‘monetary rule of law’.[^38] It replaces governance by authorities (elected or otherwise) and their ever-changing discretionary rules, with fixed ones. Whether optimal or not, those rules are steady hands in unsteady times. The rules by which bitcoin operates can be thought of, then, as a binding constitution.[^39] As with the American Constitution, the rules are very hard to change (game theory ensures this result) and nourish certainty about money supply. Just as a written constitution codifies rights and protects citizens from the fickle dictates of democracy, bitcoin’s rule-based order protects its users from rulers, or the people themselves.

Bitcoin is a technology. But its institutional design contrasts sharply with that of traditional big tech platforms and services. Meta, Apple, Google, X, and others: these systems are centrally governed by CEOs, boards, or shareholders. Users rely on corporate authorities, here, to store their data for them, grant access to it, and to maintain a network that connects them to other users. Bitcoin users store, receive, and send money themselves without the permission of anyone else, and connect directly with other users.

Bitcoin, then, isn’t big tech. It’s small tech.

That’s theory. Let’s look at practice, and what bitcoin’s exit does for its users.

I’ll begin with Roya Mahboob. Roya is a software developer and entrepreneur, formerly in Afghanistan, and with an international client base. She is also a woman, and most of the engineers working for her were women too — and thus, blocked from traditional banking systems and access to property. No surprise there: patriarchs use local institutions to censor the economic activities of disfavored groups. What were these women to do? Petition local banks for permission to have an account? Vote the patriarchs out? Beg the United Nations for help? Nonsense. They turned to bitcoin: global, permissionless, and without managers or mediators standing in the way of their work and livelihoods. Some saved their bitcoin for a rainy day and “… one woman whose husband beat her and confiscated her money was able to save her money once she began earning bitcoins, because her husband could no longer take the money. She eventually saved enough to file for divorce.”[^40] For these women, bitcoin was useful indeed.

The Open Dialogue Foundation (ODF) is a human rights group founded in 2009 by Ukrainian activist Lyudmyla Kozlovska, and currently headquartered in Belgium. Their mission is to safeguard human rights, democracy, and the rule of law in the post-Soviet world. Naturally enough, they became a target for smear campaigns, debanking, and harsh currency controls. Authorities stepped in, marked the ODF as “risky”, and blocked access to bank accounts and big tech financial services like Revolut and Wise. ODF executives saw personal accounts shuttered too. But bitcoin didn’t block ODF, because bitcoin cannot discriminate on the basis of political opinion or activity.[^41] The ODF now runs much of its operations on bitcoin — donations, payments, grants, humanitarian aid, support of activists in Belarus and Russia, and more.[^42] When authorities flexed, bitcoin was a money of last resort — an exit option.

The Central Bank of Nigeria (CBN) has overseen monetary crisis after monetary crisis. The Nigerian naira is a mess, and has seen its value plummet by over 70% in just the last five years. Naturally, locals try their best to escape into other, more reliable monies. The response is predictable: block the exits. Also predictable: an emerging local economy built on bitcoin and cash (bypassing banks and cryptocurrency exchanges) granting citizens access to money beyond the control of incompetent rulers. These workarounds were so successful that the CBN was forced to walk back its currency controls. The possibility of exit can be a powerful trigger for the improvement of local institutions.[^43]

The Communist Party of Cuba has long used monetary repression — printing into oblivion — to extract value from citizens. Hold local pesos, and you will see the value of your savings approach zero in not too long. Bitcoin, despite its volatility, is an attractive alternative. As Alex Gladstein of the Human Rights Foundation explains:

To avoid this misery and rent-seeking, a growing number of Cubans have turned to Bitcoin. I interviewed dozens of Cubans on the island who had started to use and save Bitcoin in the year 2020, when one Bitcoin was trading at around US$5,000. Imagine saving your wages in a currency, the Cuban peso, that collapsed by 90 percent versus saving in a currency that has appreciated by 2,000 percent, if you opted for Bitcoin. This is a decision many, many Cubans have made out of necessity in the past five years. Today, there are entire underground schools in Cuba that teach citizens how to use Bitcoin safely, how to spend them, and how to educate local merchants to accept them.[^44]

Where local authorities exploit discretionary monetary policy, users turn elsewhere, and find refuge in bitcoin’s rule of law. The examples I’ve cited are not unique: sex workers, dissidents, journalists, activists — outsiders of all kinds — turn to bitcoin when local monies collapse or are blockaded.[^45]

Of course, turning to bitcoin can backfire. In 2022, a convoy of Canadian truckers converged in Ottawa to protest their government’s response to COVID-19. The government responded by activating new emergency powers, freezing millions of dollars and hundreds of bank accounts. A familiar playbook: to stop dissent, shut down the money. Corporate authorities in Canada and the United States fell into line, and GoFundMe quickly blocked the truckers from accessing the funds they’d crowdfunded from supporters. So the truckers turned elsewhere, and began soliciting bitcoin-denominated donations through centralized platforms like Coinbase. It didn’t work.[^46] These corporate authorities fell into line too. Their mistake was this: instead of using bitcoin directly, and doing without trusted authorities, they reintroduced the very managers and mediators bitcoin was designed to route around. They accessed bitcoin through big tech, and suffered the consequences. Bitcoin is resistance money, but only when used in its native form. For bitcoin to do the work I’ve identified here, it must be used as small tech: holding your money yourself, running your own bitcoin software, transacting directly with other users.

Similar remarks apply to other centralized exchanges and lending platforms that dealt with bitcoin and went belly-up, to their own shame with grievous consequences for their users. Though I don’t wish to blame fraud victims, a little pattern recognition seems in order. Their mistake is the same as the Canadian truckers’: trusting mediators or managers to look after bitcoin instead of using the network itself.

For years, Google’s slogan was “don’t be evil” (why they quietly deleted that dictum is left as an exercise for the reader). Hard to disagree with, no? We hope they’ll do as they say.[^47] And we hope regulators, too, will do as they say, and keep big tech in line. That is the big tech way. Bitcoin is different in kind. If bitcoin had a slogan in this arena, it might be, instead: “can’t be evil”. Bitcoin does not discriminate on the basis of political opinion, race, sex, or nationality because bitcoin cannot do those things. As a pseudonymous distributed cryptographic system, it has no way of knowing what your political opinion, race, sex, or nationality even is, much less blocking you on such bases. This is the small tech way.

We can sum up the argument of this section as follows: 

| Bitcoin is useful |
| :---- |
| U1. An appreciable fraction of humanity suffers under bad monetary luck or censorial institutions. U2. Bitcoin is a workable exit. U3. If an appreciable fraction of humanity suffers under bad monetary luck or censorial institutions, and bitcoin is a workable exit, then bitcoin is useful. U4. Therefore, bitcoin is useful (from U1-U3). |

The argument is valid; if its premises are true, its conclusion must be as well. Reflection on the problems of monetary luck and censorial institutions support U1. The exit bitcoin provides its users — a solution to the problems, that is — supports U2. When problem meets solution, we find product-market-fit: a tool that can do something for its users. And so, U3.

Is bitcoin always useful in the ways identified in this section? Of course not. There are significant barriers to entry, sub-optimal network effects (many merchants would rather take dollars than bitcoins), and a host of drawbacks stemming from the volatility its capped supply engenders. The point is not that bitcoin is a panacea, or that everyone should always use it. It’s that it is useful to have as an option, where users may decide for themselves if the price is right. I conclude, then, that bitcoin is indeed useful.

But is bitcoin unique? Are there better solutions to these problems? We will turn to these questions in the next section.

## 4\. Bitcoin is special

Bitcoin stands apart.

To further develop this claim, I’ll present a framework by which to compare bitcoin to other monies, work through some of the alternatives, and show how each has significant drawbacks.

### *4.1. Six dimensions of monetary design*

Of any money, we may ask six questions:

1. Who produces it?  
2. At what marginal cost?  
3. Does it enjoy non-monetary use?  
4. Can it be directly possessed without a manager?  
5. Can it be transferred without a mediator?  
6. Is it digitally native?

Let’s see how things stack up along the six dimensions these questions mark. I’ll talk about “dollars”, but what I say will also apply to other sovereign monies.

Production. Bitcoin has no centralized makers. It is algorithmically produced, either by no one, or by the network as a whole, when fresh bitcoin accrues to its miners, as a reward for adding new transactions to its ledger. Gold is like this. Though physical mining is required to extract it from the earth, it is produced in the first instance, either by no one, or perhaps by God-or-Nature. Digital and physical dollars, by contrast, are produced by commercial or central banks or their deputized partners.

Cost. Bitcoin is expensive to produce, on the margin, since mining fresh bitcoin takes electricity and chips. So also, gold. Printing physical or digital dollars, by contrast, is free on the margin. To see the importance of the marginal qualification, note that once fixed costs are paid — a network of banks, a press — it is free to produce $100 instead of $10. Just add a zero, in the digital case, or swap a $10 plate for a $100 one, in the physical one.

Use. Some things are useful because you can consume them, as when eating a mango or making tungsten sculptures. Bitcoin’s usefulness is not of that kind. And it has no cash flow. It is, in those two ways, without intrinsic value. Its value is, instead, extrinsic, and derives from the fact that it can be exchanged.[^48] It is a *pure* money, in that sense, free of non-monetary uses. Physical and digital dollars are like bitcoin in this respect. You can’t consume them. But you can exchange them. Gold is the oddball here; unlike pure monies, it has non-exchange uses, such as jewelry and electronics.

Possession. One can possess bitcoin directly — not by way of a trusted manager, that is — simply by possessing the secret key that controls a given quantity.[^49] So also, physical cash and gold, as in a pocket or a vault. Digital dollars, by contrast, can only be possessed by way of a trusted manager. You can own or have a legal or moral right to them, but a commercial bank balance, or a PayPal balance, or a Revolut or Wise balance by nature is possessed in the first instance by the relevant bank or financial service provider.

Transfer. One can transfer bitcoin directly — not by way of a trusted mediator, that is — simply by initiating a transaction that sends the bitcoin to a new address. Miners add new transactions to bitcoin’s ledger, but at no point in that process do they have control over the balance transferred. Gold and physical cash, too, can be transferred without any mediator. I can give you either by simply handing it over. The transfer of digital dollars, by contrast, requires the cooperation of trusted mediators, and sometimes a vast network of them, some of whom possess the quantity transferred. When I send you a PayPal balance or a wire transfer, for example, I enlist the cooperation of PayPal itself, its partner banks, my own banks, and so on.

In these two respects, possession and transfer, bitcoin, physical cash, and gold are all so-called “bearer assets”.

Digital. Bitcoin, of course, is digitally native. It lives and moves and has its being on, and only on, computers. Digital dollars are like this too, though they can of course be exchanged for physical dollars, as when withdrawing cash at an ATM. Their habitat is not a network of users; it is, rather a network of institutions — central and commercial banks, big tech firms, and the like. Gold and physical dollars live in another world entirely: they take up space, have mass, and enjoy the other usual properties you’d expect from physical or non-digital items.

We can put all these points together in the following grid:[^50]

|  | Physical dollars | Digital dollars | Gold | Bitcoin |
| :---: | :---: | :---: | :---: | :---: |
| Centralized makers | ✓ | ✓ | ✗ | ✗ |
| Costly production | ✗ | ✗ | ✓ | ✓ |
| Non-monetary use | ✗ | ✗ | ✓ | ✗ |
| Direct possession | ✓ | ✗ | ✓ | ✓ |
| Direct transfer | ✓ | ✗ | ✓ | ✓ |
| Digitally native | ✗ | ✓ | ✗ | ✓ |

Bitcoin is not unique in any one of these dimensions. But it stands apart in its approach to the questions taken together, and thus in the bundled product it offers. Its unusual sequence of checks and xs, if you will, is its signature.

I have said that bitcoin enjoys only extrinsic value, and that its value lies in exchange rather than consumption. We can be even more precise, though. Bitcoin’s exchange value lies in its niche capacity for exchange. It can do what other monies cannot.

Thus, theory. Now, practice.

We’ll work through the problems of monetary luck and censorial institutions now, but in reverse order.

Suppose you were subject to censorial monetary institutions. You said a bad word. You spread a conspiracy theory. You donated to a dissident journalist. You now have powerful enemies: American regulators, or a big tech firm, or perhaps Russian President Vladimir Putin. And now you’re locked out. To what money might you turn?

A cavalier approach is common here. “Just use dollars”, it recommends. Let’s see why the privileged perspective it encodes is a mistake, and what follows.

Digital dollars. The dollar, and other leading sovereign monies like the Singapore dollar, the euro, the British pound, the Swiss franc, are jealously guarded in digital form. You cannot hold digital dollars yourself; you need an account. And you cannot transfer them without the permission of trusted mediators. If you are subject to a censorial campaign, the ranks close quickly among various trusted parties that manage the digital money. And the reason is unsurprising: mediators are required by law to comply with a host of Know Your Customer or Anti Money Laundering regulations. And since they are eager to remain connected to other authorities in digital dollar networks, they comply with corporate edicts as well. Get banned from one financial service, and you’ll likely be banned from them all quickly enough. This is what happened to the Open Dialogue Foundation and its access to euro-denominated accounts, as we saw above.

Gold. Precious metals are hard to censor, in small amounts. You can carry them around yourself, and hand them to others. So far so good. But carrying them across a border, when a target for censorship, is a disaster in the making. Gold’s strength — it is physical, and has mass, and volume — is here a liability. Gold, furthermore, cannot be transferred over the internet. In an increasingly digital world, that is an even bigger problem. Roya Mahboob, recall, needed to send and receive payments from overseas clients. Gold, since it was not digitally native, could do her no good there.

Physical dollars. Cash is great. Cash is king. But it suffers the same defects as gold, because it too is physical. Centralized attempts to move towards a cashless world, furthermore, hamper access to physical notes or coins, and make them less useful even if you got ahold of them.

Bitcoin. Unlike cash and gold, bitcoin can be sent or received over the internet. So it solves that problem for otherwise censored users. And it can be both held or transferred without the cooperation of banks, regulators, or big tech firms. So it solves that problem too.

We can now see where the cavalier approach goes wrong. When nothing else works, bitcoin does:

For many human-rights advocates, the U.S. dollar simply cannot get the job done… In 2014, Roya launched the charity Digital Citizen Fund to teach skills to young Afghan women and girls. She made sure to include Bitcoin training, eventually educating more than 25,000 women and girls about the digital currency and other technologies… \[when Kabul fell to the Taliban\] most people fleeing lost everything: Their money could not be moved across borders, and the sudden escape did not provide citizens enough time to liquidate and sell their belongings… But not Roya, or the girls who had learned about the digital currency, whose value was stored on the internet and was accessible with a password that could be written down, hidden, sent to a friend abroad, or even memorized. Today, after more than 1,300 days where Afghan girls have been prevented from going to school, Roya continues to fund underground education inside Afghanistan with Bitcoin. The teachers, who receive the payments directly from Roya and her team, can spend their Bitcoin at peer-to-peer markets or exchange them for cash with local contacts. It is technologically impossible to use the dollar banking system to do this critical work, but with Bitcoin, it is simple.[^51]

You might have wondered why, if bitcoin has no intrinsic value, and if it has no state to back it up, it has enjoyed a non-zero price for nearly two decades. Now you know. Bitcoin can do what other monies cannot. David Andolfatto, a former Senior Vice President at the Federal Reserve, put it this way:

Bitcoin offers people a money storage and transfer system with two key properties: (i) permissionless access and (ii) decentralized database management. The first property means that no one can prevent a user from sending any amount of Bitcoin from one account to another. The second property means that the protocol does not depend on the existence of a delegated authority to manage accounts and transfer funds. The fundamental demand for Bitcoin derives from the fact that there are at least *some* people who value these features. This fundamental demand provides a non-zero lower bound on the price of Bitcoin.[^52]

Bitcoin’s unique signature gives it special powers. Herein lies its charm and its ongoing value.

Sovereign monies enjoy a demand floor — there is always someone willing to give up something of value for them — in part because someone out there is legally required to pay taxes denominated in their unit of account. So long as someone will face jail time should they not pay their euro-denominated tax bills, there will be non-zero demand for euros. Bitcoin enjoys a similar demand floor, provided that someone out there wishes to route around authorities. Journalists, dissidents, criminals, sex workers, or other outsiders who insist on being paid in bitcoin function, then, like the tax collector does for a sovereign money. Because these outsiders demand payment in bitcoin, others have secondary reasons to acquire or hold bitcoin in the first place. Authoritarian crackdowns, furthermore, enhance bitcoin’s utility. And so they enhance, rather than suppress, fundamental demand for bitcoin. 

Suppose that you were subject to bad monetary luck, and that your local scrip was being printed into oblivion. For the same reasons given above, digital dollars, gold, and physical dollars are incomplete solutions. Access to digital dollars (or euros, or pounds…) is simply not possible for most people alive today. Here, the very tools authoritarians use to censor make escape from monetary repression difficult, as when banks clamp down on access to foreign exchange during a local currency crisis. Gold and cash (of a superior currency to the local scrip) fare better here in one respect, because they are bearer assets. But they falter because they are not natively built for a digital world. Bitcoin, for the same reasons, stands apart again.

### *4.2. Crypto*

Most unfortunately, I must now say something about other cryptocurrency projects. The short version is this: most are scams. Though they now number in the millions, few have any real world use, and most exist solely to enrich their founders. Here’s how one kind of scam works: someone launches a new token, assigns a huge chunk of circulating supply to themselves, their friends, or other insiders, and markets the token with various exciting slogans: a world computer, the future of dentistry, the future of finance, the future of file-sharing, and so on. When buyers line up, founders profit; tokens that were free to produce, on the margin, are traded by insiders for something of real value and use (dollars or bitcoin). The revealed preference here is telling: founders would rather have the real money they take instead of the tokens they give. Buyer beware.

Bitcoin isn’t like this at all. Even bitcoin’s founder had to buy his coins from nature — he mined them using chips and electricity, just like anyone else — and so far as we know never dumped them on the market. The contrasting revealed preference here, namely to prefer bitcoin over dollars or the electricity or chips they can buy, is telling too. And though bitcoin boosters pollute the waves with overblown stories of bitcoin’s utility, the stories are founded in reality, which reality is documented above.[^53]

There is another reason most crypto tokens are unsuitable solutions to the problems of monetary luck or censorial institutions. Across a significantly long period of time, no one wants them. Their prices, that is, trend inevitably to zero, whether against bitcoin or against the US dollar. They have neither bitcoin’s history nor its network effects. So even if we take their technical promises seriously — faster, cheaper, shinier — they remain to bitcoin as Esperanto is to English: unused, unwanted, unsung.

Having dismissed the scams, I will say something about a distinct class of crypto token: the so-called “stablecoins”. These are tokens designed to trade at parity with, for example, the US dollar — one token, one dollar. Stablecoins are a dollar substitute, and can do some things ordinary digital dollars or dollar substitutes (like bank balances) cannot do: you can hold stablecoins, for example, without a bank account, and without handing over any identifying personal information. Stablecoins are useful. They give users digital access to a globally dominant monetary network and its unit of account, the dollar. But for doing the work of resistance money, they suffer a fatal flaw. They can be censored or confiscated. Tether is by far the most important stablecoin token. At the behest of regulators, or under its own rules, the issuer of Tether regularly freezes balances, blacklists addresses, and confiscates funds.[^54] As the issuer of its token (maker), the custodian of its backing assets (manager), and overseer of the smart contracts that permit or deny transfer (mediator), Tether is a trusted authority in exactly the sense that commercial or central banks are. No surprise that it creates exactly the risks they do.

### *4.3. Tradeoffs*

I have emphasized some pleasing ways in which bitcoin is unique. But every precious thing comes at a dear price, and bitcoin is no exception. Tradeoffs abound. The very properties that allow it to be a uniquely useful resistance money hinder its ability to do other work. It is custom built for a custom purpose, and I freely grant that it is less suited for other purposes. Let’s look at two examples.

#### Quantity vs. Price

As noted above, bitcoin offers its users a steady supply schedule that cannot be easily manipulated. This creates what monetary economists call a quantity guarantee.[^55] Bitcoin has no central bank, or anyone else, for that matter, who promises to act so that its token trades at some target value, or that its unit does not skyrocket or plummet in value quickly. And you can see why: promises of that kind — to expand or contract supply at will — require rulers for which bitcoin simply has no room. A credible quantity guarantee is not everything, but it is something: for when in place it means that one kind of risk is removed from the picture — the risk of wild, unpredictable, or irresponsible contractions or expansions in monetary supply.

Decent monies, as we might call them, are sovereign currencies that enact a credible price guarantee. Their makers’ solemn promise is to keep inflation within some defined bounds (somewhere around two percent per year, for example), and thus to keep nominal prices predictable and steady. Price guarantees are useful. And they’re better than one alternative. For bad monies, as I’ll call them, are governed poorly, and have neither a credible quantity guarantee nor a credible price guarantee.

Before bitcoin, the problem of monetary luck was that you might be stuck with exactly one option, and thus enjoy neither a price nor a quantity guarantee. This was your lot in life:

|  | Bad money |
| :---: | :---: |
| Price guarantee | ✗ |
| Quantity guarantee | ✗ |

If you lucked out, your options were significantly better:

|  | Decent money | Bad money |
| :---: | :---: | :---: |
| Price guarantee | ✓ | ✗ |
| Quantity guarantee | ✗ | ✗ |

Bitcoin, in existing, adds an option for those who suffer bad monetary luck — not a price guarantee, but a quantity guarantee:

|  | Bad money | Resistance money |
| :---: | :---: | :---: |
| Price guarantee | ✗ | ✗ |
| Quantity guarantee | ✗ | ✓ |

I do not say that bitcoin is a better choice in every case, especially for those lucky enough to have access to good money. But it is a better choice for those otherwise stuck only with bad money. Better to have access to a quantity guarantee, and its protection against policy-led disaster, than no guarantee at all.

#### Ease vs. Exit

Bitcoin is easier to use than ever. Its lightning network makes for fast and cheap payments, and thousands of merchants around the world accept bitcoin for goods or services, and thousands of individuals will happily trade with you using bitcoin as a medium of exchange.[^56] But one must be realistic here. So long as you don’t need to do business over the internet, nothing is as convenient as cash. And if you are privileged enough to access well-managed digital money, nothing is as convenient as using some slick big tech payments platform like Revolut, PayPal, Venmo, and so on.

Bad monies, by contrast, have poor network effects, few people willing to accept their unit of account, and substandard digital tooling. They may have no slick payments app at all. The worst of all worlds. Being stuck with bad money is bad luck indeed.

As before, bitcoin adds an option to the mix. Bitcoin can do what decent monies cannot. At the price of convenience or easy access to merchants or individuals ready to accept its unit of account, bitcoin gives its users a precious thing indeed: exit from rulers altogether. I do not say that it is better than decent money in every case. But it is better than bad money, and once again adds unique value to the world by offering users the choice of a tradeoff, as follows:

|  | Decent money | Bad money | Resistance money |
| :---: | :---: | :---: | :---: |
| Ease | ✓ | ✗ | ✗ |
| Exit | ✗ | ✗ | ✓ |

Is there such a thing as an ideal money? A money that checks all the boxes, and serves all users in all cases? I am skeptical. Think, for example, of the classic framework according to which money is to serve as a unit of account, a medium of exchange, and a store of value. That third role is best-served when the unit of account reliably goes up in value over time: save in such a currency, and your value will be stored, and compound over time. But a money whose value compounds over time is one users will be reluctant to part with — or so says standard economic wisdom — and a money no one wants to spend is less useful as a unit of account or medium of exchange. The point is this: there is good reason to believe that we want various things from money, and it is by no means obvious we can get all of them at once. No solutions, only tradeoffs. The lesson from all this is that bitcoin is special, not because it is an ideal money, but because it is resistance money.

### *4.4. Can bitcoin be copied?*

Because it is digital, bitcoin’s code can be copied and pasted at zero marginal cost. Anyone can make a new “bitcoin 2.0” and operate it as they like. They might even fix a few bugs along the way, or improve it along some technical or economic dimension. Is bitcoin still special, even when its software can be cloned for free? Indeed so.[^57]

Bitcoin the network is not the same as bitcoin the software. Bitcoin the software can indeed be cloned at a very low marginal cost. Its network cannot. For its network is sustained by the activity of tens of thousands of node operators. To truly clone bitcoin the network, each of these node operators would need to be persuaded to run the cloned software. And persuading tens of thousands of people to do anything is a non-trivial operation. You can’t do that with the mere push of a button.

World of Warcraft (WoW) is a popular multiplayer game. Millions log in monthly, and interacting with those millions is a main attraction. Imagine that its code and art assets were all leaked. Anyone could now forge their own WoW-style experience and launch their own clone of that game. Would the clones be as popular? Would they actually deliver the same experience to users? It depends. To pull off this feat, they’d have to attract millions of users, for one. Without them, they’d be empty and boring. They might also need to attract developers – to fix bugs, release new content, and so on. Without them, WoW 2.0 might well be unplayable. Networks are hard to reproduce.

There is a deeper reason that bitcoin’s network is costly to clone. Bitcoin’s node operators evince a preference to run, not bitcoin 2.0, but bitcoin, because of bitcoin’s unique history. Histories can’t be cloned; nor can their social meaning. That a new country has a letter-for-letter copy of the Constitution of the Republic of Singapore, for example, does not even suggest, much less guarantee, that it will enjoy any of Singapore’s successes. It would lack Singapore’s founding story, and its founding people. Bitcoin’s founding story, and its founding people, are distinctive too. It once had a leader; it no longer does. Though it has early adopters, it has no insiders. No one, not even its pseudonymous creator, can mint new bitcoin for free (a point we’ve seen already). And regardless of how it is cloned or imitated, it remains the first of its kind. It is a game-theoretic Schelling point, for this reason, and such points are by nature hard to copy.[^58]

We can sum up the argument of this section as follows:

| Bitcoin is special |
| :---- |
| S1. If bitcoin is digitally native money that works without trusted authorities, unlike its alternatives, then it is special — a unique resistance tool for its users. S2. Bitcoin is digitally native money that works without trusted authorities. S3. Its alternatives are unlike bitcoin in this respect. S4. Therefore, bitcoin is special — a unique resistance tool for its users (from S1-S3). |

So bitcoin is useful, and it is special. What next? Is bitcoin actually good for the world? After all, some tools are both useful and special but a disaster for their users or for the rest of the world. Is bitcoin like that? Or is it something to be applauded, for the way it improves human lives? We’ll now turn to these normative questions.

## 5\. Bitcoin is good

It is time to put the pieces together from our previous discussion into a master argument that bitcoin is good. It is good, I shall argue, for there to be a way for people to take their leave from bad monetary institutions, and from financial censorship. And that’s what bitcoin is.

### *5.1. Exit from bad monetary luck is good*

Why is solving the problem of monetary luck a significant point in bitcoin’s favor? In short, because monetary repression is very bad indeed.

Textbook statements of the harms of inflation — menu costs, shoe leather costs, and so on — are too abstract for our purposes. The much more human toll of inflation on everyone else, and the instability it creates in both individuals and societies, is what I want to focus on here. None other than John Maynard Keynes put it best over a century ago:

… while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become "profiteers," who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.[^59]

For many, bad monetary luck is far from abstract, and bitcoin’s solution is no mere theory. From our position behind the veil, the numbers are alarming, and should lead us to give special moral weight to the relief bitcoin offers. Hence Gladstein:

Only about 13 percent of the world enjoys both a liberal democracy with free speech and property rights and a “reserve currency”—that is, a monetary unit sound enough that other governments are interested in accumulating it in their reserves. The other 87 percent of humanity was born into either an authoritarian regime or a collapsing fiat currency (government-issued and not backed by a commodity). Simply put, democracy activists are turning to Bitcoin because the existing system is not working for them.[^60]

Exit options aren’t just good for the people who exercise them. They’re good for the world. For the threat of exit provides legacy institutions a reason to improve. Andolfatto puts it this way: bitcoin is a “threat” that “will discipline the Fed and other central banks to continue to run responsible policies.”[^61]

Since the harm that bitcoin mitigates here is weighty indeed, I conclude that bitcoin’s usefulness along this dimension — exit from bad monetary luck — is a strong point in its favor. That the most obvious alternative responses to bad institutions — loyalty and voice, that is — fail so badly, strengthens the point. The bitcoin exit need not be ideal to be the best available option for those stuck under bad luck, and its presence makes the world appreciably better for all.

### *5.2. Exit from censorial institutions is good*

I boldly hypothesize that censorship is bad. If you don’t believe me, try being censored some day. You’ll see. The point applies, not just to censorship of thought or word, but of their economic expression too. Since bitcoin helps users exit from the structures that make for financial censorship in the first instance, it is good.

If you still harbor doubts, I have another simple argument. Upholding basic freedoms is good. And basic freedoms require uncensorable money. Since bitcoin is uncensorable money, it derives instrumental value by promoting basic freedoms.[^62]

Basic freedoms of the sort all liberals prize include things like freedom of speech, of assembly, of religion, and of the press. I will not argue for the value of these freedoms here, and note as above that the authoritarians among us will deny my premise. But if you are a liberal of any kind at all, you’ll see good sense in the idea that liberty is a great and precious good.

Exercise of these basic freedoms, furthermore, inevitably involves financial activity, as when buying a train ticket to assemble for protest, paying for a web server to launch a new press outlet, or purchasing religious paraphernalia to perform vital rituals. When authorities threaten to flex, furthermore, the exercise of these basic freedoms requires the capacity to route around them. It requires, that is, uncensorable money.

Since bitcoin is just that uncensorable money, it follows from these premises that bitcoin is itself a valuable instrument in promoting basic freedoms. In a digital age, this substrate for freedom is even more valuable.

The preceding argument is liberal in its assumptions, but not libertarian.[^63] It does not presuppose, and I do not insist, that there are absolute rights to basic freedoms, or to the tools required to exercise them. But it is liberal, and as such does presume that liberty enjoys significant moral weight. If you agree with that presumption, you have strong reason to think that bitcoin, in providing exit from censorial institutions, is a boon for the world.

If you’ve been paying attention, you will be unsurprised by what I say next.

Bitcoin is for criminals. Bitcoin is for deviants. Bitcoin is for outsiders.

The slogans I’ve just recited typically come from the mouths of critics, not proponents. But they express an important truth, and I will not shy from it. Because it routes around authorities, bitcoin is custom-built for people who wish to resist those authorities. When the authorities in question are government employees, and when the rules they wish to enforce are codified in law, we call those would-be resisters “criminals”. Bitcoin is for them. This is not a decisive mark against bitcoin. Why? Since some laws are bad, some criminals are good. Sometimes it is not just permissible, but morally mandatory, to commit crimes, as when disobeying unjust laws.[^64] Tools that facilitate resistance of this kind should be praised, and their resistant powers should be at least *pro tanto* celebrated, not hidden. Bitcoin is such a tool. For it enables anyone to resist the tyrants who'd get between us and the exercise of our basic freedoms. I do not say that all crime enabled by bitcoin is good, any more than I’d say that all crime enabled by encrypted messaging apps is good, or that all crime enabled by physical cash is good. But given a basic liberal orientation, our stance towards those technologies — private messaging and cash, that is — should be positive, precisely because they enable the exercise of basic and precious freedoms. So also for bitcoin.

### *5.3. Beware the shotgun* 

Bitcoin boosters and critics, all too often, deploy the “Gish Gallop”. Instead of going deep, considering the pros and cons alike, and looking with a critical eye at the empirical evidence, they fire at a distant target and hope the wide shot spread ensures a kill. My esteemed debate partner here would never do this, of course. But I must issue a warning: beware the shotgun. If someone thinks she can show bitcoin is good, or that it’s bad, in just a few paragraphs, she is mistaken, and likely subject to just the kinds of biases we’ve been trying to avoid.[^65] Rattling off a dozen pro-bitcoin talking points, or anti-bitcoin objections, is a sign that someone is selling you something, in my experience, and what they are selling is not serious inquiry or understanding. Word to the wise.

An intellectually honest approach to the question at hand — is bitcoin good for the world? — requires cataloguing, from behind the veil, not just bitcoin’s benefits, but its costs too. In a recent book, my co-authors and I canvassed some 25 objections to bitcoin, each designed to identify some cost, and argued that the conceptual and empirical evidence either refutes or significantly mitigates each.[^66] I can’t do all that in this opening statement. But I will, I expect, reply to a number of objections in the replies to come, and thus enhance and deepen the cumulative case for bitcoin. So if you’ve gotten this far and are friendly to bitcoin, but want to know more about how to assess the objections, keep reading. We’ll get there soon.

The argument of this section may be stated as follow:

| Bitcoin is good |
| :---- |
| G1. If bitcoin is useful, and a unique resistance tool for its users, and its harms do not outweigh its benefits, then bitcoin makes the world better. G2. Bitcoin is useful, and a unique resistance tool for its users (from U4 and S4) G3. Bitcoin’s harms do not outweigh its benefits. G4. Therefore, bitcoin makes the world better (from G1-G3) |

G1 shows us how to move from the fact that bitcoin is useful, and that it is special, to a normative stance. G2 restates the conclusions of those earlier arguments. The way to make a case for G3 is by looking, one by one, at bitcoin’s harms and benefits, weighing them against each other. That task is by no means complete, but one important line of evidence is now in place, establishing that bitcoin’s benefits are wide and deep. I will show, in the pages to come, that the case for G3 is by no means illusory, and the objections pose no decisive threat to what should be already apparent: bitcoin is good.

As you read the rest of this volume, I recommend that you keep a scorecard: pluses and minuses, risk-adjusted behind the veil (if that’s your stance).[^67] When you’re done with the book, zoom out, weigh them each against all the others, and see what you think. Though this volume is officially a debate, and though both writers have opinions on its titular question, my hope for you is that you’ll learn something along the way, see past your own biases and those of the pundits, and come to a reasoned and evidence-supported view of your own.

## 6\. Conclusion

Suppose that my three arguments are sound and that bitcoin is useful, special, and good.

What follows? That you should buy or use bitcoin yourself? It is not my role to give financial or monetary advice. But I will say this much, and exactly what I’d say about any other technology: if it’s useful for you, and you’re satisfied it does no deep and countervailing harm, use it. Is bitcoin useful for you? Do you need insurance against the problems of monetary luck or censorial institutions? Only you can say. Think about it. But in any case, another conclusion follows from the arguments thus far. Even if it does not make *your* life better, it is a lifeboat for others. Free advice? Do not impede their salvation.

Return to where we began: the eight-billion-sided die. You don’t know where it will land, but you have to give it a roll. In rolling, you confront the problems of monetary luck and censorial institutions. You just might need bitcoin.

In a world without bitcoin, your options in these dire scenarios are loyalty or voice. In a world with bitcoin, you have another option: exit. You may leave the bankers behind for a system without makers, managers, or mediators. It is not perfect, and certainly not without tradeoffs. But it works.

For the lucky few, bitcoin may look like an unnecessary or speculative doo-dad at best, and perhaps much worse. But from a suitably person-neutral perspective — as when evaluating bitcoin from behind the veil — we can see past these superficial and privileged viewpoints to something much more interesting. Bitcoin is insurance for the vulnerable, a check on the power of overreaching corporations and states.

When you open your eyes, you should hope to see a world where exit is possible. You should hope to see a world with bitcoin.

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[^1]:  Ballantyne (2019a) and (2019b).

[^2]:  Many of the arguments I’ll give in this opening statement echo and develop those I’ve offered with my co-authors in Bailey, Rettler, and Warmke (2024); see also Bailey, Rettler, and Warmke (2021a) and (2021b). I will not here explain in any depth how bitcoin works. For the gory details, see Warmke (2021), and Antonopoulous (2017). 

[^3]:  For more on biases, and specific examples of pundits pro and con, see Bailey, Rettler, and Warmke (2024): Chapter 4\.

[^4]:  Kelly (2023).

[^5]:  See Harsanyi (1953) and (1955) and Rawls (1999). For details on how the veil here differs from ideas in both Harsanyi and Rawls, see Bailey, Rettler, and Warmke (2024): Chapter 4\.

[^6]:  Buchak (2017).

[^7]:  For some recent evidence on primary vs. secondary uses of bitcoin, see White (2023): 170-178.

[^8]:  Sabaghi (2023).

[^9]:  Gemayel (2026).

[^10]:  Feras (2025).

[^11]:  Mills (2022).

[^12]:  Badendieck (2024).

[^13]:  Clarida (2024) and Giovanni et al. (2023). For a historical look at central-bank induced instability, see Selgin (2010).

[^14]:  United Nations Conference on Trade and Development  (2022).

[^15]:  Bank for International Settlements (2024) and International Monetary Fund (2024).

[^16]:  World Bank (2025). 

[^17]:  For more on currency debasement in Venezuela, Lebanon, and elsewhere, see Selvam (2025): 130-131.

[^18]:  The next few paragraphs borrow from a blog series I wrote for the Bitcoin Policy Institute.

[^19]:  The term was invented by Nic Carter and has found wider use since then. See, e.g., Financial Services Committee (2025).

[^20]:  Mullen (2025), Shapero (2025).

[^21]:  Warren (2025).

[^22]:  Reitman (2026).

[^23]:  FIRE (2022). 

[^24]:  Messina (2023). On the more general phenomenon of ‘private government’, see Anderson (2017).

[^25]:  Draku (2026) and Katungulu (2026).

[^26]:  Caucasus Watch (2025).

[^27]:  Iran International (2025).

[^28]:  Silva (2025).

[^29]:  See Reitman (2026). The Human Rights Foundation’s “Financial Freedom Report” offers further ongoing documentation of the phenomenon in view.

[^30]:  I borrow this example, and the label for it, from some recent discussion in the philosophy of religion about the problem of evil, and God’s alleged reasons to permit such. Some say these are also no-see-ums: not the sort of thing we’d know about, even if they’re there. See Wykstra (1984).

[^31]:  Hirschman (1970). For ease of presentation, I’ve switched the order from Hirschman’s original.

[^32]:  Butler (2022): 98\.

[^33]:  Friedman (2012): 211\.

[^34]:  I speak from experience here.

[^35]:  On bitcoin’s predetermined supply and absolute scarcity resulting, see Selvam (2025): 26\.

[^36]:  For more detailed treatment of bitcoin as a monetary institution, see Bailey, Rettler, and Warmke (2024): Chapter 5\. On bitcoin’s monetary policies, see White (2023): Chapter 5\.

[^37]:  For a detailed look at bitcoin’s game theory, see Warren (2023) and Bailey and Warmke (2025).

[^38]:  Bailey, Rettler, and Warmke (2024): 106-109.

[^39]:  On which see Selgin and White (2005).

[^40]:  Shin (2017).

[^41]:  Kozlovska (2024).

[^42]:  Kozlovska (2025).

[^43]:  Mehta (2025).

[^44]: Gladstein (2025): 26\. For comparison, at the time of writing bitcoin trades north of US$50,000.

[^45]:  Gladstein (2025).

[^46]:  Baydakova and Reynolds (2022). See also Selvam (2025): 184\.

[^47]:  The hope is misplaced. Over the last decade, big tech platforms have, in ways that are possibly unlawful and certainly illiberal, systematically censored law-abiding and peaceful user content well beyond payments. For detailed and recent documentation, see Siegel (2026).

[^48]:  For discussion, see Luther (2018).

[^49]:  Bailey (forthcoming).

[^50]:  This grid upgrades a framework given in Bailey, Rettler, and Warmke (2024): Chapter 3\. See also Selgin (2015).

[^51]:  Gladstein (2025): 22-24.

[^52]:  Andolfatto (2019): 2\. See also White (2023): 165-168 and Bailey and Warmke (2025): 36-37.

[^53]:  For detailed argument along these lines, see Bailey and Warmke (2023). On bitcoin’s founding, see Bailey and Warmke (2025).

[^54]:  At the time of writing, something like $4.2 billion in Tether is frozen. See Howcroft (2026).

[^55]:  Bailey, Rettler, and Warmke (2024): 109-110.

[^56]:  Bailey, Cross, Hendrickson, Luther, Rettler, and Warmke (forthcoming).

[^57]:  The following three paragraphs borrow from Bailey (2024): 29\. For more on the copy problem, and bitcoin’s resolution to it, see the rest of that article.

[^58]:  Bailey and Warmke (2025): 35-39.

[^59]:  Keynes (1920): 236-237.

[^60]:  Gladstein (2025): 21\.

[^61]:  Wile (2014).

[^62]:  Bailey, Rettler, and Warmke (2024): Chapter 7\.

[^63]:  For useful reflection on an egalitarian case for bitcoin, and some weaknesses in a libertarian one, see Sandberg and Lindblom (2024).

[^64]:  For more on these points, see Bailey, Rettler, and Warmke (2024): 164-166.

[^65]:  Brandolini’s Law further complicates any attempt at sober evaluation. It says that the effort required to refute bullshit exceeds that required to generate it, by an order of magnitude. Much easier to fire off quips than to dig deep. Alas.

[^66]:  Bailey, Rettler, and Warmke (2024), especially Chapter 11\.

[^67]:  For more on score-keeping of this kind, see Bailey, Rettler, and Warmke (2024): Chapter 12\.