From truth to peer review to copy; anarcho-capitalism; bitcoin; Defi; blockchain; marketing; Austrian economics
Is the joke on me for even attempting an analysis? But I’m supposed to be a non-lefty intellectual, so this certainly should be right up my alley. But I’m also oft with the unpopular fringe, naturally repelled by almost anything that becomes popular. Bitcoin (BTC) is different, however, as it truly will always be unpopular and fringe, as I shall explain in a bit. But could I be missing something here about doge? Are there more similarities between bitcoin and dogecoin only in some kind of reverse? Is dogecoin the cryptocurrency, which is actually most like bitcoin? Both grew in use and popularity unexpectedly and quietly—until the mainstream, of course, started taking notice—but still remaining within the universe of the fringe. They’re both still enemies and threats to the institutionalized mainstream. Difference is, BTC was created as money and DOGE was but a joke.
Satoshi Nakamoto seemed bent on making sure the world knew the true purpose of bitcoin, when he embedded these words in the BTC Genesis Block, “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks”. It was in reference to the Times headline at that time and it seemed Satoshi created BTC as an alternative to the financial system, which he believed problematic with the choice of ‘brink’ (identifying key players), with the word choices ‘Chancellor’ and ‘banks’ (alluding to the cozy relationship between government and the financial industry), and the system they created, enabling a ‘bailout’ (which happens often enough as it is on the ‘brink’ of a ‘second'). On January 9, 2009, the open source bitcoin client was released, hosted at SourceForge. One of its first supporters, Hal Finney downloaded the software and was the recipient of the first ever bitcoin transaction--10 bitcoins from Satoshi Nakamoto.
Meanwhile, we have the less serious and more fun narrative of dogecoin. Jackson Palmer, average geek Australian marketer for one of the world’s largest tech companies, took aim at bitcoin and the world of cryptos, by tweeting, “Investing in dogecoin, pretty sure it’s the next big thing.” To his surprise, the tweet generated so much attention. Palmer decided he wanted to continue having fun and went on with the joke. He bought the dogecoin.com domain and uploaded a Shibe on a coin with a note on the site: “If you want to make dogecoin a reality, get in touch.” Meanwhile, somewhere in the UK, a video-game obsessed software engineer at IBM, took his own aim at the crypto world. Like Palmer, he too wanted to have some fun. He created his own cryptocurrency called “Bells”, named after currency in Nintendo’s Animal Crossing. But unlike BTC’s proof-of-work consistent rewards system, “Bells” was random. You never knew if you would get any or if it would be one bell or 500 bells. But unlike Palmer’s coin proposal, the cryptocurrency community didn’t get the joke and didn’t like bells. Markus found Palmer’s message, contacted him, and together they worked on dogecoin with the primary purpose of having fun. Markus admits to finding chunks of bitcoin's source code incomprehensible, but knew enough to change a few core elements. He created 100 billion dogecoins (as opposed to bitcoin's 21 million), made them easier to mine, changed the font to Comic Sans, and changed every mention of the word 'mine' to 'dig' (because dogs don't mine, they dig). Reddit users loved it and started sharing dogecoin back and forth constantly, expanding its user base and increasing its value. In 2014, Palmer and Markus attached a more ‘humanitarian’ aspect to Doge, when they successfully raised funds for Jamaica’s bobsled team to compete in the Winter Olympics. They also raised enough funds to build water wells in Kenya as well as funds to help train assistance dogs for autistic children. But as the community grew, Palmer and Markus began clashing with members of the community, who were beginning to look at Doge as wealth opportunity and hedge. In their view, dogecoin was a silly thing that should remain silly. Eventually, both founders bailed out on the coin and today remain crypto skeptics.
But there may be more to this than meets the eye. This seemingly large disparity in seriousness (practical opposites) may shed more light into some sort of congruence or kinship between the coins. For starters, both are products of human design with a collaborative element that brought each into fruition—Satoshi and Finney, unassumingly in the specialized, technical, fringe realm of cryptography; Palmer and Markus, in the rebellious-fringe world of Reddit. Both coins were given as tips and rewards within their worlds and groups. And while both were products of human design, they were also a natural and organic consequence to an environment of human created parameters and controls. Thus, one can argue, at the core, both coins were natural creations, which organically grew. BTC was created by its founder, Satoshi Nakamoto as “a purely peer-to-peer version of electronic cash” without going through a financial institution. Dogecoin.com defines Doge as, “an open-source peer-to-peer digital currency.” One is “cash” and the other, “currency”.
And here, once again, we see a slight (but possibly) significant deviation, where the former is ‘cash’ (defined by an online dictionary as ‘money’) and the latter, ‘currency’ (‘a system of money in general use in a particular country’ or ‘the fact or quality of being generally accepted or in use’). One can argue it’s mere semantics but there might be more to this random and accidental semantic difference that could’ve extended from the intended purpose of each—a serious proposition for an alternative financial system and a joke—but both reactions to and consequences of the contrived and controlled money system. Contrary to popular belief, BTC hints at an intrinsic value; while Doge, like all other altcoins doesn’t—for the simple reason only Bitcoin truly has the fourth characteristic of money—noncounterfeitability. BTC is unique as it has one characteristic that no other coin has—immutability. This unique characteristic, precisely because it is unique, gives BTC an intrinsic value. Unlike bitcoin, all non-bitcoin blockchains are merely tamper-evident, meaning-- you can’t change something without anyone noticing. But there is a higher security standard, which only bitcoin is--tamper-proof because of its proof-of-work mining algorithm, which in turn makes it immutable.
Anyone with decent enough coding skills can change code; but Satoshi was smart enough to ensure the near impossibility of successfully carrying this out by grounding the BTC system in sound economics—specifically, in the difficulty of getting every member of the network to adopt the same changes to the software. By ensuring that finding the solution to the mathematical problem consumes large quantities of processing power and electricity, the incentive to not include any invalid transactions in the blocks to receive the block reward, makes the cost of writing a block extremely high and the cost of verifying its validity extremely low. Thus, we can argue, bitcoin might have some intrinsic value as it actually uses something of value (energy) when it converts electricity to truthful records through the expenditure of processing power; and it is the only one that can make this claim. Moreover, it is the only crypto and blockchain that ever will be (as it is--immutable) because it has done it already and it was able to do it at a time, when nobody cared to see, look, notice, or even care because in its early days, the network had little economic value. The value of BTC is entirely dependent on the integrity of the network, which is in the best interest of its miners to maintain. It is their life blood. And after a decade, any attempt to compromise or attack has simply become too expensive. To add, the effort to carry out an attack, change, or compromise the system renders the attacker’s loot worthless. Satoshi ensured BTC’s failure would benefit neither the attacker nor the groups and individuals maintaining the bitcoin ecosystem. I stress, it is the only one of its kind and it will always be the only one for the simple reason it already happened. The very context of its creation and the manner in which it proceeded, ensured its immutability and it is the only one that ever will be. It thus, makes sense to refer to bitcoin as ‘money’ and Doge (as well as all other alts) as ‘currency’—‘a system of money in general use in a particular country’ (community, system, or group) or ‘the fact or quality of being generally accepted or in use’. While BTC is also a consequence of ‘general acceptance’, its achievement of immutability and the uniqueness of this quality, has given it an intrinsic value, which cements this ‘general acceptance’ into permanence.
According to Nassim Taleb, bitcoin is antifragile. According to Andreas Antonopalous bitcoin is nimble and robust with the immune system of a sewer rat. And so bitcoin dodged (‘avoided by a sudden quick movement’) the dodge (‘a sudden quick movement to avoid’) in Doge (the popular meme coin). As Palmer and Markus took aim at bitcoin in order to, in a sense, avoid the seriousness of its cause and purpose, BTC was simply too quick and done, it had dodged even before the aim. Perhaps what Palmer and Markus really wanted to hit was the phenomenon of bubble creation (prevalent in the crypto world) and not the seriousness, which, upon a closer look, is actually an endearing quality of BTC in synch with the original concerns of Doge’s founders. They didn’t need to poke fun at BTC (and even the alts), if they understood the underlying effect of the phenomenon of the money-creation enterprise, which bitcoin launched—a kind of perpetual real-time demonstration and experience of the silliness of the almost century-old financial system.
But altcoins don’t fret. As Andreas Antonopoulos says, “money is language human beings created to express value to each other.” It isn’t value but an expression of value. So there definitely can be and certainly is space for the development of various expressions. BTC merely beat all to immutability; and there can never be one like it for the simple reason it already happened in all its unassumingness, when no one bothered or cared to look. Yes, it is true, altcoins are companies and thus, aren’t truly decentralized. Saifedean Ammous believes the concentration of currency holding, processing power, and programming skills in the hands of one group of people who are effectively partners in a venture defeats the entire purpose of employing a blockchain structure; and should the currencies appreciate significantly, a small team of creators become extremely rich, gaining power and roles reserved for nation-states. In addition, it would be relatively easy for central banks to get any of the teams behind this currency to destroy it, or alter its operation. Unlike bitcoin, altcoins aren’t immutable nor are they tamper-proof. And while efforts such as the Decentralized Autonomous Organization (DAO) are attempting to precisely bring ‘decentralization’ to the fore, without active management by a team of developers and marketers, no digital currency will attract any attention or capital in a sea of thousands of currencies (and still growing). The need for management is inevitable; but as Ammous says, “the re-injection of subjective human management is at odds with the objective of making code into law, and questions the entire rationale of smart contracts”, of which these DAOs are based. Unlike bitcoin, which quietly and unassumingly grew in the wild, without any authority controlling it, altcoins have had the unfortunate reality of BTC’s immutability as past and achieved (growing even more with time), which is anathema to a project that wants to demonstrate credible commitment to a fixed monetary policy. Reality is, bitcoin is the only truly market-based security model that is immutable and tamper-proof. While it was originally a product of rational human design (Satoshi), its growth and development was and has been organic and spontaneous—a product of human action vs. human design, having no office, board, owners, or any centralized authority except the collective economic incentive locked onto the goal of maintaining the network’s integrity.
Nonetheless, I say, altcoins, do not fret. All this merely means, bitcoin is the only one—the unique standard, which poses as a reminder to all of calling a spade a spade, and to remember why any altcoin came to be in the first place—as this can be easily lost in the space. Even if only BTC is immutable, its immutability has given all altcoins and future altcoins a standard by which to premise their potential solutions. The bitcoin standard allows anyone access to a moral compass without actually moralizing. Bitcoin captured natural law into a tangible system, token, and store of value, fueling disruption in reverse into communication. Bitcoin already secured immutability and it would be pointless and even a waste of time and resources for others to do the same. As Andreas Antonopoulos says, for other blockchains, DAOs, and Dapps, governance (how you take funds and manage them, how you take the energy of a community and manage it, how you reinvent the corporation) is the killer app. Bitcoin already killed unsound money. It’s time to find other things to kill. To be fair though, altcoins such as etherium (the number two) aren’t competing with bitcoin.
We return to Doge. It seems Satoshi was well informed and might have predicted the coming blockchain world, which certainly easily enables and creates 1984, further entrenching surveillance and the continued creation and inflation of bubbles. Satoshi seems to have leveraged the blockchain with bitcoin, serving as the single one that cannot be touched; in addition, the hedge against bubbles posed by the alts. And Doge might just be this leverage and hedge in reverse of BTC’s seriousness. Indeed, it reminds us we can also have fun in the plight of the fight against the conflation of money with currency, blockchain with database, and human action with human design.
The meme typically consists of a picture of a Shiba Inu dog accompanied by multicolored text in Comic Sans font in the foreground. The text, representing a kind of internal monologue, is deliberately written in a form of broken English. Dogecoin might actually have a case for immutability without actually being immutable. It seems bitcoin is dodging Doge as Doge might be dodging the alts and BTC bit by bit. If Doge does become a popular currency, it would merely be getting on with the same joke as fiat—only this time, it would have a standard (BTC) to keep the fun clean, reminding us of the constant danger of the financial system possibly going to the dogs, as we human beings tend to be quite forgetful.
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