Andreas M. Antonopoulos Part II: Money, Trilemma, & Bitcoin for Babysitting on Crypto Clothesline Podcast
Last week in Part I of our chat with Andreas M. Antonopoulos Talking Bitcoin Mass Adoption and Pesky PMs on Crypto Clothesline Podcast, we talked about mass adoption, ex Aussie PM maths’ blunder and dressing for respect…
This week in Part II of our chat with Andreas M. Antonopoulos: international speaker, disruptive thinker, popular podcaster and prolific author, we continue our meandering crypto journey from answering deeply what money is (including language, exchange, goat shit and animal behaviours), to the Vitalesque trilemma of scalability, decentralisation and security of the blockchain tech supporting cryptocurrencies, to Kardashian Koins and Bitcoin for Babysitting!
Andreas M. Antonopoulos Part II:
- what’s money?
- trilemma: to scale or not to scale, that is the question
- Kardashian Koin???
- Bitcoin for Babysitting – why wouldn’t you?
What Is Money?
One of the key themes throughout the Money Season, and a question we’ve asked each of our guests is, What is money?
In responding, Andreas likens money to language, a series of agreed values given to symbols (like currency), which convey meaning between those who adhere to, or use those symbols.
A $10 note is just a piece of plastic-paper printed with the symbols of a dollar sign, the number 10, some pics and maybe some identifiable code that makes that note traceable.
That note, once able to be traded BTW for $10 worth of gold (the ingots are too much to lug around so I’ll give you a ‘note’ for it, come back and cash in your note at the bank once you’re done with it – pre 1971 Nixon days, that is) is virtually worthless per se.
The point that Andreas makes is that ‘money doesn’t have value’ and the only value is what we assign to it through commonly held agreements:
“Money is a symbol for the value that you can get with it.
“The value is in the product or service or thing you exchange money for, or that you provide in order to earn money.”
“Money is simply a way to symbolise and express that value in a way that’s universal, that everybody understands, that everybody values equally.”
And that’s just what language is. A series of symbols with a developed shared meaning, which we use to communicate ideas, values, opinions and cultural conditioning. This is shared within a set of speakers who’ve learnt to recognise and practise the use of those symbols through aural, oral, visual, and mark-making communication.
“Language is a series of symbols that allow us to share common meaning, that are universal or at least universal within that location or culture.
“And they allow us to convey meaning. And then in the case of money, it’s a specialised language that allows us to convey value…it allows us to convey what we value and how much we value it, which then allows us as a society to allocate resources based on that understanding.”
Language, a system of conventional spoken, manual, or written symbols by means of which human beings, as members of a social group and participants in its culture, express themselves.
That money is a ‘form of speech’ was a new yet particularly obvious observation, and even more interesting when noted that other species of animals including birds, apes, and fish articulate this kind of ‘shiny object’ value deduction in their exchanges to gain status, food and even sexual favours!
“A symbolic language that emerges not just from human species, but also from nonhuman species. We’ve seen the several species can be taught money and some actually figure it out or use tokens themselves spontaneously…like swapping shiny things.”
Judge and Essler (2013) designed a token exchange paradigm to test self-control in capuchin monkeys (Cebus apella). Different types of tokens were exchangeable for different types of food, and when monkeys were given tokens for lower value food items that they could exchange for either that food type or a token for a higher value food, some monkeys (two of seven) made the token-for-token exchange. This allowed them to later obtain a better food, showing self-control in not taking the more immediate food.
“Using them to strengthen social bonds or loyalty to one another or things like that. Birds do it. Apes do it. Primates do it. Some types of mammals do it. Fish do it. So it’s a fairly common thing and you can teach animals to use tokens for value.”
Take this exchange a step further. Keep in mind the analogy of money being language: an exchange of intangible agreed meanings which, even though there is no solid swap of goods when we communicate, our interactions carry immeasurable weight in terms of value exchange in a given cultural context.
“Once you realise that money doesn’t have value, but it’s a language, then you realise that the ultimate expression of money as a language is in completely digital form… if that can be exchanged without intermediaries, a publishing system but rather bought through an open and public system, in that kind of intangible digital form, just like we do with words.”
“We publish articles on the web and we publish bitcoin on the bitcoin blockchain. Then money takes its real symbolic nature. You cut out all of the intermediate, as you cut out all of the unnecessary layers and you make it simply an additional symbolic system that can be transmitted over any communication medium.
“It becomes extremely robust to interference because it’s very decentralised. There are copies of it everywhere and it turns out you don’t need a government to bless it with value.”
You Can’t Have All Three
According to an idea thought to have been first explored by Vitalik Buterin, Co-founder of Ethereum, scalability trilemma is considered the most significant unsolved challenge in the blockchain space. The trilemma being the three-sided triangle trade-off between scalability (making it fit larger, world-based demand), security (say no more) and decentralisation (the reason most of us got into crypto in the first place.)
“The truth is that cryptocurrencies, open public blockchain-based cryptocurrencies, do not scale efficiently.
“The reason they are difficult to scale is because this is an important trade-off. It’s a very deliberate trade-off.
“If you want very fast scalable database like behaviour, you can engineer it. What you’re trading however, is decentralisation.
“So open public blockchains, especially ones that have decentralised consensus algorithms with thousands of participants will suffer more from scalability problems since then more centralised, more closed, federated systems where you have fewer participants in consensus is the difference.”
That means that the more centralised ones are easier to sensor, they’re easier to disrupt, are cheaper to run and more efficient in terms of capacity.
“You can’t have all three.”
How Many Languages Can We Speak? How Many Cryptos Can We Spend?
In the same way you can have different dialects of a language, or different religions within a region, you can have different coins and currencies. Andreas likens this to how many bloggers or podcasters or vloggers you can have… the number is limitless since the relatively low-cost technology needed to launch these kinds of platforms is virtually accessible to all who have a smartphone and access to the internet.
“Currency is a language and my prediction then, and there was no strong basis for that prediction, was we’re going to have thousands, then we’re going to have tens of thousands, then we’re going to have hundreds of thousands. And I might, if I revise that prediction, I might add millions!
“We’ve opened the door and now everyone who wants can step through that door. There used to be a time when you had four TV channels, how many can you have today? How many programs, how many videos? Infinite. All of us. The same thing happened with currency. It’s going to take a while for people to absorb that. It’s not a good thing or bad thing, it’s just a thing, right?
“Every individual can decide to tokenise themselves to make a brand.
“My prediction is many people will, many organisations will… there’s no limit to this. And, and 99.99% of them will not be particularly interesting outside of a single group or culture that derives social value from this.”
Flummoxed as we are as to why you’d want to devour the Kardashian day-to-day news, it’s clear that market dictates value, and so fans of the K fam would obviously value a Kardashian coin…
“There are social popularity values that are do not make sense to anyone who’s not part of the ingroup.
“I don’t understand why anyone pays attention to the Kardashians, but the point is to their fans
“I’m not saying this is good, I’m just saying this opens the door to a whole spectrum of expression.
“A new channel for human expression.”
Bitcoin for Babysitting
So once upon a time when my kids were smaller, it was hard since we lived in the country and our families lived far away. We needed to rely on our community for babysitting help. That meant:
- Knowing the other families in the group/community
- Trusting the other families in the group/ community
- Organising an exchange system with the other families based on tokens not money
This is way before the day of Bitcoin or anything, at least before I knew about it and it had immense value because none of us wanted to pay an unknown babysitter. We had the time and we had the expertise to take care of each other’s kids and we had the trust: three important value aspects.
I asked Andreas about a babysitting token in a trusted group within a certain community which I assumed could be hugely of value while being independent of the Australian dollar.
He basically said, Why bother? And, Why not use bitcoin?
Andreas suggested that an hour of babysitting could cost a thousand satoshis (smallest unit of bitcoin recorded on the blockchain) with a monetary value of almost nothing.
“It’s preferable to bootstrapping a whole other token system, and you can use a nominal, small amount effectively discounting only for the participants within the groups so you’re not feeling you’re out of pocket.”
This works particularly well for those without a great wad of cash to fall back on, and means that you still exchange some degree of value, which may change over time, but which is accessible to all, and easy to swap.
“Essentially you’re now using this subdivision of the coin for that purpose.”
That’s a Wrap for the Crypto Clothesline Money Season!
We say a huge thanks and farewell to Andreas and all our guests and listeners, and fans of Crypto Clothesline for this epic Money Season.
Part I of our chat with Andreas M. AntonopoulosTalking Bitcoin Mass Adoption and Pesky PMs on Crypto Clothesline Podcast
Subscribe and Contribute to Andreas M. Antonopoulos on Patreon
Prostitution in animals – Excerpt in intro of David Pakman Show ‘ ‘Monkeys Pay for Sex After Learning to Use Money’.
Find Andreas M. Antonopoulos on Twitter
Listen to Andreas M. Antonopoulos on YouTube
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