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The Bitcoin Paradox
Article

The Bitcoin Paradox

Why cryptocurrency will always be political.

Nautilus, 2017

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Editorial Rating

8

Qualities

  • Applicable
  • Eye Opening
  • Concrete Examples

Recommendation

“Everything is politics,” the German novelist Thomas Mann once said. That observation remains true even when complex technologies and mathematical formulas govern financial transactions online. In an insightful editorial, social scientist Simon DeDeo uses the example of the blockchain to illustrate that humankind hasn’t moved beyond the basic norms of social interaction that enabled human communities to thrive for millennia. Readers who fancy looking at the bitcoin debate in a broader context should find DeDeo’s take intriguing.

Take-Aways

  • The blockchain that enables the trade of the bitcoin cryptocurrency is a social construct and depends on all network users agreeing on a set of common rules.
  • The existence of the chain itself and the rules that govern it are based on the sociological concept of “common knowledge.”
  • The blockchain provides a mechanism by which people can build trust and form common knowledge without meeting in person.

About the Author

Simon DeDeo is an assistant professor in social and decision sciences at Carnegie Mellon University and external professor at the Santa Fe Institute.


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