Georg Wilhelm Friedrich Hegel was a difficult man. Even its name is a bite.
With more layers than a wedding cake, the German philosopher was the human equivalent of quantum theory.
As the physicist Richard Feynman famously said, “Anyone who claims to understand quantum theory is lying or going crazy.” The same charge can be made against Hegel’s philosophies. If someone claims to fully understand Hegel, he or she is lying, or possibly both. Just like the works of James Joyce, no one reads Hegel’s works, not because he had nothing to say, but because he was a linguistic enigma. Deciphering Hegel is like trying to baptize a cat. Stressful and a little traumatic.
Fortunately, however, Hegel’s dialectical method is easily digestible, at least for the purposes of this article. Presented in three ways, first comes the thesis, a kind of established narrative. Think of the thesis as conventional norms: nuclear families, monotheistic religions, traditional political parties, etc. A response to the thesis comes in the form of the antithesis, which seeks to undermine or replace the thesis. An obvious tension arises between the two, which we are told is then resolved by synthesis, the last part of the Hegelian triad.
How can the Germans’ method with the basics be applied to the world of Bitcoin? More specifically, how can it be applied to the opposing worlds of fiat currencies and bitcoin?
Fiat vs. Bitcoin, in Hegelian terms
As you no doubt suspected, fiat currencies represent the thesis.
A well-founded thesis is supported by well-founded evidence. The current arguments for traditional fiat are, to say the least, highly unsound. First, fiat money is backed by governments, not a physical commodity such as gold. Furthermore, Fiat is a product of belief, and belief in Fiat is inconsistent with facts.
Since the Nixon shock about 50 years ago, the bastardization of fiat, especially the US dollar, has increased exponentially. In October last year, Politico’s Caitlin Emma warned readers that the public deficit “had tripled to a record $ 3.1 trillion in fiscal 2020, with the budget gap increasing to a share of economic output unseen since World War II inflated ”.
According to Emma, government spending “exceeded $ 6.5 trillion in the fiscal year ended September 30, compared to $ 4.4 trillion in fiscal 2019.”
This is worrying on many levels both at home and abroad. There is no world currency – at least not yet – but when it comes to reserve currencies, the US dollar is king. But now the king looks frail. Worse, he’s senile, impulsive, and drunk on his own.
A coup in the form of synthesis is long overdue.
Based on a system of transparency and superior technology, Bitcoin provides a legitimate answer, a negation of the thesis, so to speak.
Thesis vs. antithesis
Tyler Winklevoss, founder of the Gemini cryptocurrency exchange, agrees. In a recent blog post he had this to say:
“Money that is kept in a bank is run over. Money invested in assets like real estate or the stock market will keep pace. Money stored in gold or bitcoin will escape the scourge. And money stored in Bitcoin will run the fastest, overtaking gold. “
He makes a compelling case. After all, more than a fifth of all US dollars ever created were created in the last twelve months. Yes, you read that right.
Joe Biden once said that “reality has a way of invading”. Well, Joe, as Philip K. Dick famously wrote, “Reality is what when you stop believing in it doesn’t go away.” The dollar’s decline requires a quick fix.
Digital gold and digital oil (in the form of bitcoin) offer us a nifty escape. Finally, it makes perfect sense to use non-fiat derivatives. Bitcoin has exposed the financial fault lines that exist in the traditional system; Blockchain technology, the often unsung hero, enables us to take advantage of it. John Zanni, President of the Acronis Foundation, believes that blockchain technology will have a similar transformative impact as the Internet “back in the 1990s and early 2000s”. Just as the synthesis negates the thesis, blockchain technology is characterized by the fact that it eliminates the middleman.
In a recent chat with famous investor Raoul Pal, Erik Voorhees, ShapeShift’s founder and CEO, spoke about the future of finance and the inevitable widespread adoption of bitcoin and blockchain technology.
When asked about fiat currencies, Voorhees replied, “They fall apart on their own. They collapse by themselves because they have been forgotten. “
Voorhees calls Bitcoin a “credible alternative” and believes that a greater degree of individual autonomy will lead to a “reduction in government coercion.”
Although many of us dream of a decentralized Garden of Eden devoid of any government gods, the reality of the situation may turn out to be very different.
Regulatory creep is inevitable. It always was. This brings us to the third and last part of the Hegelian triad: the great compromise, also called synthesis.
Now that the cryptocurrency world has started to invade the establishment turf, we have seen a stronger pushback.
In the world of DeFi, according to a report by the Electronic Frontier Foundation, “the US government has increasingly taken steps to undermine the anonymity of cryptocurrency transactions and import the widespread financial oversight of the traditional banking system into cryptocurrencies.” Meanwhile, Christine Lagarde, the President of the European Central Bank, recently called for global regulation of Bitcoin in Europe to prevent further “funny business”.
In addition, if the nebulous concept of stakeholder capitalism of the Executive Chairman of the World Economic Forum Klaus Schwab is realized, BTC is likely to face a variety of coercive and highly bureaucratic measures.
Commenting on Schwab, Professor Jeffrey M. Herbener wrote in a post for Mises.org about the very real threat posed by a “singular global monopoly” where those in power dictate the flow of finance – who gets what, how? a lot etc.
As the aptly named writer Luke Savage recently commented somewhat wildly, the financial world is run like “a roulette wheel in an Atlantic City casino,” with those who run the table having the “keys to the safe.” With this power they determine “always the traffic rules and who is allowed to play”.
The time for synthesis?
In order for BTC to have an internationally recognized seat at the table, a compromise has to be made, whether we like it or not. Resistance is futile.
Hegel, not a friend of compromise, spoke of totality. The totality, which comprises several stages, many of which are radically different in nature, is the absolute whole, the cumulative effect. Hegel called the stages – the ingredients, if you will – as moments; After various negotiations have been concluded and mergers have taken place, the whole is created.
When it comes to the financial entirety of the future, we will likely have an amalgamation of moments from the traditional sector and moments from the blockchain-powered future, with hopefully more of the latter than the former.
The truth, according to Hegel, is to be found “neither in the thesis nor in the antithesis, but in an emerging synthesis that brings the two into harmony”.
This is the beginning of an emerging synthesis. As for reconciliation, time will tell.
This is a guest post by J. Mac Ghlionn. The opinions expressed are solely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.