#284 – Saifedean Ammous: Bitcoin, Anarchy, and Austrian Economics

483 snips

May 11, 2022

Saifedean Ammous, an Austrian economist and author of "The Bitcoin Standard," dives into captivating discussions about Bitcoin, the evolution of money, and critiques of Keynesian economics. He challenges the value of fiat currencies versus hard assets like gold and Bitcoin, emphasizing sound money principles. The conversation also touches on the mysterious Satoshi Nakamoto and explores the ethical dilemmas of diamond trade. Ammous advocates for free markets, examining how personal choices interact with broader economic systems, making this a thought-provoking listen.

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INSIGHT

Money's Purpose

Money is a medium of exchange acquired to be traded for other goods, not for consumption.
It facilitates the division of labor, allowing specialization and increased productivity in larger economies.

INSIGHT

Markets and Money

Markets emerge naturally from voluntary exchanges, regardless of size or complexity.
Money enhances market power by reducing the mental burden of finding coinciding wants.

INSIGHT

Hard Money

Hard money is historically chosen because it is difficult to produce more units, like gold.
Gold's hardness stems from its indestructibility and limited supply growth, unlike silver.

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The bitcoin standard

Saifedean Ammous

The Bitcoin Standard analyzes the historical context to the rise of Bitcoin, the economic properties that have allowed it to grow quickly, and its likely economic, political, and social implications. The book takes the reader on an engaging journey through the history of technologies performing the functions of money, from primitive systems to modern government debt. It explains the operation of Bitcoin as a decentralized, distributed piece of software that converts electricity and processing power into indisputably accurate records, allowing users to perform traditional monetary functions without relying on authorities or physical infrastructure. The book also explores common questions surrounding Bitcoin and its potential as a store of value and a network for final settlement of large payments, challenging government monopolies and offering a vision of money extricated from politics and borders.

Credit Theory of Money

Alfred Mitchell-Innes

The Fiat Standard

Saifedean Ammous

In 'The Fiat Standard', Saifedean Ammous delves into the world's transition from the gold standard to the current system of government-backed fiat money. He explains the fiat standard as a feat of engineering and technology, similar to his analysis of bitcoin in 'The Bitcoin Standard'. Ammous outlines the purposes and failures of the fiat standard, deriving its wider economic, political, and social implications. He also examines how bitcoin could affect the fiat system over time, highlighting issues such as inflation, government intervention, and the potential for bitcoin to provide a more stable and salable alternative across space. The book critiques the distortions caused by fiat money in various global markets and suggests that bitcoin could lead to an orderly upgrade of the world's monetary operating system.

Principles of Economics

Saifedean Ammous

Human action

A Treatise on Economics

Ludwig von Mises

Human Action is Ludwig von Mises' magnum opus, where he defends an a priori foundation for praxeology and methodological individualism. The book argues that the free-market economy outdistances any government-planned system and serves as the foundation of civilization. Mises explains complex market phenomena as the outcomes of countless conscious, purposive actions and choices of individuals. He critiques government attempts to regulate and control economic activities, emphasizing the futility and counter-productiveness of such interventions. The book is a systematic treatment of the whole body of social and economic relations, integrating various economic problems into a comprehensive system[2][4][5].

The Blocksize War

Jonathan Bierman

The Blocksize War chronicles the intense conflict within the Bitcoin community that began in 2015 over the issue of increasing the block size limit. The book delves into the technical, political, and philosophical aspects of this debate, highlighting key figures such as Mike Hearn and Gavin Andresen who proposed increasing the block size to 8 MB. It explores how this debate split the community, led to the creation of Bitcoin XT and later Bitcoin Cash, and discusses the broader implications for the decentralization and scalability of Bitcoin[1][2][3].