Theory of Bitcoin: Essential knowledge from Craig Wright and Ryan X. Charles

By June 30, 2020Bitcoin Business
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Are you an experienced Bitcoiner, or just starting out? What do you think you know about Bitcoin, and are you prepared to accept there’s still a lot to learn? Money Button founder Ryan X. Charles has joined Bitcoin inventor Dr. Craig Wright for a video series of in-depth discussions everyone should watch.

Dr. Wright proposed the discussion series to Charles earlier this year, promising to help him “understand the other 99% of Bitcoin.” They then decided to release their recordings to the public—since, if a veteran like Charles understands only 1% of Bitcoin’s potential, then everyone else would have a lot to gain from it too.

The first video in the series, titled “Introduction – Theory of Bitcoin,” would be equally useful to someone approaching Bitcoin for the first time, whether or not they had any preconceptions. Even many in the BSV community have re-evaluated their thoughts on Bitcoin’s purpose and future in recent years—perhaps even the Bitcoin Core (BTC) community, since BTC has mostly failed to gain mainstream adoption.

The (re)introduction to Bitcoin everyone needs

Understanding Bitcoin in 2020 involves a lot of un-learning, or realizing what Bitcoin is not. Dr. Wright begins by saying we should stop using the term “cryptocurrency”, since “currency” is not the same as “money”, and Bitcoin “is not encrypted”.

Ryan asks the question many of us have heard but plenty still haven’t: Why did you create Bitcoin? It’s mostly about making payments on the internet, and Dr. Wright isn’t necessarily talking about online shopping. The two then talk about how Bitcoin’s initial anarchic reputation grew from previous attempts to create an online currency, plus a few misconceptions that spread in Bitcoin’s early days—which may have been intentional.

The myth was there, and rather than actually correcting everything, they tried to alter to fit the narrative.

People shouldn’t expect Bitcoin to replace national currencies, or eliminate taxes, at all. But it could automate them and make it simpler, reduce fraud and its costs, and finally bestow upon the Internet the built-in commerce system its inventors originally wanted.

Bitcoin ideology: yes, there’s plenty

Like any conversation with Dr. Wright, there’s a lot of philosophy mixed in with the tech talk. Dr. Wright has plenty of disdain for Silicon Valley’s current drive for “intelligent” machines, and its almost anti-human outlook. He is one of the few leaders in technology who constantly reminds us that people should always be more important than machines.

The push for AI is partly to absolve humans from responsibility for the decisions they make, Dr. Wright says. “The excuse is always about agency.” Moreover, replacing more and more workers may create more higher-end jobs, but it will create a massive underclass of people with nothing to do. And no-one wants to talk about that.

Dr. Wright is not an egalitarian, and says “equality” is not only impossible, but undesirable. Hierarchy is inherent in human society and the form of money it uses doesn’t make any difference.

“We don’t have a right to happiness … we have a right to pursue happiness. We wouldn’t have poetry if we didn’t have unhappy people!”

People still need to be motivated to work, to create, to learn. You can’t impose any ideology or economic system to change that.

Money is not evil, capitalism is not bad; we don’t live under capitalism today

There’s a misconception in the world today that capitalism is bad. Capitalism is not bad, but that’s not the system we have today, Dr. Wright says. For true capitalism to work, “We have to want people who want to work. We have to have a society that wants more, that needs more, that wants to strive, that isn’t going to be satisfied where they are.”

“We end up with perverse situations where people worship profit for the sake of profit. Not thinking long term, just ‘I have more money’ … But it’s not even money that people want.”

Money is just a tool people use to obtain what they really want, Dr. Wright says. Whether it’s status, power, or whatever. Bitcoin won’t create wealth by itself, but it’s a much better tool to help people create wealth.

That said, there is some of Dr. Wright’s ideology in Bitcoin, it’s not completely neutral. Dr. Wright has a lot to say about auditing and fraud prevention. One major causes of fraud is the opportunity to commit the crime itself. Bitcoin’s transparent, distributed ledger removes most of the opportunity, or as Ryan puts it, “helps to create a more honest world”. It’s also designed, Dr. Wright says, to create a better form of capitalism that works for more people, by making commerce more efficient. It’s about automating payments and taxes, spending less time auditing and accounting, and transacting in micro-amounts rather than lumps.

You’ll also hear a lot more about security, economics, politics, law, and of course technology. Dr. Wright has some interesting views on Augmented Reality and its ability to assist with memory, social interactions, and human networks—and where Bitcoin fits into it all.

There will be several more videos in this series. If this introduction is any indication, the rest will be both educational and thought-provoking, and full of quotable quotes. Watch them whether you’re a seasoned Bitcoiner or just a beginner, there is something useful in there for everyone.

Subscribe to the Theory of Bitcoin channel here.

New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.

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