Bitcoin is Venice

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This is a massive, magnificent, learned contrarian work and like that other massive, magnificent, learned contrarian work David Graeber’s Debt: The First 5,000 Years, there are few practitioners in modern financial services who would not benefit from reading it for the challenge it presents.

Like any communal activity in which there are things to be gained and lost — i.e., any communal activity — financial services is a paradigm: an intellectual structure with is own rules, hierarchies, bullshit defeat devices and articles of faith, usually encrusted in so much obscurantist detail that it is impossible for communitarians to get near it without being swatted away on ground of detail — insufficient grasp of some buried esoteric intellectual construct that it is impossible for any but the truly learned to know. This is an evolutionary design feature of any power structure and is in equal parts benign and malign: without some commitment to the cause — some unconditional faith in the elders — a paradigm cannot take to the air in the first place. But the more it scales, the higher it flies and the more is at stake — the more elders there are with skin in the prevailing game — the more ossified and moribund it becomes.

People that is, either get so close to the weeds that they cannot see beyond them — and, weeds being nourishing, they have absolutely no incentive to look — or they don't, in which case they never acquire the moral authority to challenge. Paradigms progressively prefer form over substance, it being assumed the substance has been proven out by the enduring success of the paradigm. This is a circularity, but not a vicious one.

This is not to say contrarians cannot be popular or correct — Dawkins, Gigerenzer, Taleb, Mandelbrot, Stock , Scott, Jacobs, Sutherland and others ply a healthy trade preaching truths about the absurdities of our institutions, which blithely carry on regardless until real world facts intrude, and even then paradigms have a habit of shapeshifting and carrying on. You cannot defeat a power structure with a theoretical argument. The inbuilt interests are far too strong.

That is not too say we shouldn’t listen to outsiders like Graeber and Farrington.

David Graeber was, properly, an outsider. An anarchist anthropologist and one of the leading actors behind the Occupy Wall Street movement .Allen Farrington is, in one sense, not — he is a well-schooled industry insider who would not tear it all to the ground, but would rather “make finance great again” by restoring capitalism to it's Venetian apex — but in another sense he is, because his means of doing so would be with bitcoin, and by destroying what he sees as the “strip mining” version of capitalism yielded by fiat currency. As a grand vision, that is pretty anarchic: more so than Graeber’s.

Farrington cautions against excessively theoretical approaches which he says have got us here — this may be an attempt to disarm the elders as aforesaid — but there is some irony, for his own defence of bitcoin is intensely theoretical. What he has on his side, for now, is bitcoin’s sustained defiance of the elders of finance who have predicted seventeen of its last two implosions. At the time of writing, despite FTX’s collapse and CZ’s prosecution, BTC is surging back towards historical highs. This is the proof of the pudding: you can’t, as contrarian but bitcoin antagonist Nassim Taleb would say, “lecture birds how to fly”

You can, however, supply a plausible account of why, against the odds, they continue to do so.

Farrington and Taleb do not see eye to eye: Farrington has published an excellent takedown