Bitcoin and the Potential to Reduce Conflict
In his analysis, Adam Livingston presents a compelling argument for how Bitcoin, as a decentralized and finite form of currency, could potentially diminish the frequency and scale of wars. He suggests that one of the main mechanisms through which governments fund armed conflicts is the practice of printing money, which leads to inflation—a hidden tax that the public often does not see or understand.
Historical Context of Currency and War
Livingston references the World Wars of the past century as illustrations of this phenomenon. During this period, the introduction of central banking and the abandonment of the gold standard empowered governments to finance war efforts at a scale that citizens would have likely opposed if made aware of the direct financial implications.
Historically, Livingston draws on examples such as the failure of paper currency during China’s Song dynasty in the 13th century and the rampant hyperinflation caused by Assignats in 18th-century France, both of which highlight how states can over-spend on warfare, leading to a devaluation of their currencies. He argues that the ability of governments to easily create money transforms monetary authority into a form of political power, allowing for the projection of military force that would not have been accepted by the populace had it been tied to explicit taxation. This, he claims, positions fiat currency as complicit in the continuation of modern conflicts.
The Case for Bitcoin
Additionally, supporters of Bitcoin argue that it represents a critical shift in financial paradigms, acting as a remedy that separates currency from governmental oversight. Advocates believe that a transition to a Bitcoin-centered financial system can facilitate innovation, enhance social bonds, inspire artistic pursuits, and uphold individual freedoms.
Saifedean Ammous, the author of The Bitcoin Standard, argues against previous monetary systems such as gold and paper currency. He posits that these earlier forms ultimately fell short—gold led to centralized monetary systems, while paper currencies failed to preserve value due to excessive government issuance.
Impact of Inflation on Society
Ammous emphasizes that the erosion of value carried by inflation affects societal behaviors and future planning, as people become less inclined to save in a system where money continuously loses worth. He posits that a society anchored by sound money fosters a greater propensity to save, invest in groundbreaking technologies, and build strong social structures, suggesting that correcting the monetary system might indeed help repair broader societal issues.
