The Risks of Hyperbitcoinisation with Rob Hamilton - WBD501

May 13, 2022

Rob Hamilton, a programmer and data scientist, dives into the complexities of hyperbitcoinization and its societal implications. He discusses how Bitcoin's rise as a global currency presents risks like entrenched inequality and social conflict. Hamilton emphasizes the importance of maintaining technological consensus while navigating community fragmentation. The conversation also touches on Bitcoin's potential to enhance energy markets, stabilize grids, and the need for genuine, in-person dialogue to foster understanding in the evolving Bitcoin community.

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INSIGHT

What Hyperbitcoinization Actually Means

Hyperbitcoinization simply means Bitcoin gaining adoption as global money and nothing more.
Interpretations vary widely because people project their own values onto what that world should look like.

INSIGHT

Bitcoin Won't Fix Human Nature

Bitcoin fixes some structural problems like the Cantillon effect but cannot remove core human malevolence.
Storing wealth in Bitcoin doesn't confer moral virtue or stop conflict and abuse.

INSIGHT

Two Paths To Bitcoin Dominance

Hyperbitcoinization can follow a dystopian collapse path or a cooperative integration path with existing systems.
Outcome depends on how fragile current fiat systems and political institutions respond.

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Rob Hamilton is a programmer and data scientist. In this interview, we discuss the risks associated with a transition to hyperbitcoinisation, the limits to what Bitcoin fixes, the issues of a libertarian world run on a Bitcoin standard, the benefits to the energy grid, and Bitcoin's eternal September.

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Hyperbitcoinization, the adoption of Bitcoin as global money, was once a theoretical pipe dream that all but the most hardened Bitcoiners thought would be an impossibility. But we have witnessed a number of unprecedented events in recent years that mean impossible scenarios have now shifted into the realm of the possible.

Does this create a new foundation for conversations regarding hyperbitcoinization? The abstract idea of hyperbitcoinization has been enthusiastically supported: it is a fresh new idea that provides hope for a better world. But where such discussions could afford to be utopian a few years ago, do discussions now need to mature as a Bitcoin standard becomes more real?

Are there limits to what Bitcoin can fix? Further, does hyperbitcoinization create new issues? Would we be replacing one elite for another? And, if this new world is shaped by a libertarian ideology, who will determine how to organise consensus, solve problems and resolve conflict? The reality of what may be possible certainly requires more sober consideration.

The flip side is that the tremendous benefits that Bitcoin has to offer could actually be realised. A better world may be within our reach. The excitement for proponents is that Bitcoin's potential is more than just as a new currency; it has second-order effects such as its use as a payments rail and arguably more importantly, as a catalyst for a stronger and more sustainable energy grid.

And all the time, there are new users of Bitcoin who are seeing in it both novel opportunities, and also new risks to be mitigated. Wider adoption, therefore, means that what hyperbitcoinization will become is always evolving. The discussions on what this means have only just begun.