Bitcoin’s importance can’t be exaggerated. Encrypted currency has been at the Altair stage of development. If Bitcoin isn’t actually the Apple II – and it may not be – we’re very close to it. If Bitcoin isn’t the Messiah of the darknet economy, at the very least it’s John the Baptist preaching its immanent arrival.
Excerpted from Kevin Carson:
“Despite my reservations, I consider Bitcoin to be grounds for enormous excitement. Pirate Party founder Rick Falkvinge calls it “the Napster of Banking” (May 11, 2011).
As Falkvinge argued, it’s usually not the most feature-rich version of a new technology that achieves the critical mass needed for popular acceptance. Rather, it’s the most user-friendly. “…It takes about ten years from conception of a technology, or an application of technology, until somebody hits the magic recipe in how to make that technology easy enough to use that it catches on. And when it does, boy, does it catch on.”
Technologies for sharing digitized music had been around for ten years when Shawn Fanning launched Napster. Video sharing had been possible for geeks for a decade when YouTube came along. Falkvinge thinks Bitcoin will do the same thing for encrypted e-currency. Bitcoin will do to banking what BitTorrent is doing to the music industry.
Here’s how Falkvinge describes the ramifications:
“The governments of the world are on the brink of losing the ability to look into the economy of their citizens. They stand to lose the ability to seize assets, they stand to lose the ability to collect debts. No application of force in the world is going to help: everything is encrypted, and destroying a computer with any amount of police firepower will accomplish zilch.
All the world’s weapons in all the world’s police hands are useless against the public’s ability to keep their cryptographic economy to themselves….
….The decentralized, uncontrollable economy where one lifetime employment is no longer central to every human being is something I’ve called the swarm economy, and I predict it will redefine society to an immensely larger extent than the ability to get rap music for free.”
This is vitally important to a central theme in my work: the emergence of non-state spaces within which the low-overhead informal and household economy can function, outside the state’s ability to create entry barriers, impose artificial capitalization and overhead costs on low-overhead producers, and collect rent on artificial scarcity rents. It’s the enforcement of their iniquitous “laws” that prolongs the corporate dinosaurs’ feeble grip on life, and enables the usurers, landlords and proprietary content owners to collect tribute from us.
There are all sorts of possibilities for the alt economy, with a major part of economic activity taking place via an encrypted e-currency.
Until now, patents have been enforceable largely as a result of the low transaction costs involved when a handful of oligopoly producers in a given industry (who’ve often exchanged or pooled the patents) market a limited number of models of goods through mass-distribution retail chains. What happens when a garage micromanufacturer produces knockoffs of patented mass-production goods – much like the Shanzhai job shops today running knockoffs on the third shift, but with only 10k worth of homebrew CNC machinery that can be bought for three or four months’ factory wages – and there’s no verifiable record of the purchases?
What happens when the unemployed and underemployed start taking advantage of the technical possibilities for low-overhead household microenterprise, in defiance of zoning and licensing and bogus “safety” and “health” standards whose real purpose is to impose artificially high capitalization and overhead costs and make it impossible to stay in business without a sufficient revenue stream to amortize them? Say hello to household micro-bakeries using ordinary kitchen ovens, home-based cab services using the family car, household daycare and beauty salons, raw milk and meat from animals without RFID chips, etc. — all bartering with each other and with those above-mentioned garage manufacturers in an encrypted darknet economy. And all while the state, aka the executive committee of the ruling class, blindly gropes in the dark to prevent it.
The biggest effect of file-sharing was to destroy all the artificial scarcity rents of the content owners and cause an entire sector of the economy to implode to marginal reproduction cost. As Chris Anderson said, atoms also want to be free — they’re just not as pushy about it.
Bitcoin’s importance can’t be exaggerated. Encrypted currency has been at the Altair stage of development. If Bitcoin isn’t actually the Apple II – and it may not be – we’re very close to it. If Bitcoin isn’t the Messiah of the darknet economy, at the very least it’s John the Baptist preaching its immanent arrival.“