“It tells you something about the fact that money right now is being profoundly ungrounded. It is up for question.”

An interview with Prof. Bill Maurer about cryptocurrencies, the history of money, ideologies behind bitcoin and the goldbugs weird believe that good money needs to be rare.

Hello Bill. You’re an anthropologist researching money and Bitcoin. How does this stick together? What question do the Arts have for Bitcoin?

Yes, I’m an anthropologist. Almost all of my research was about law and economy. I was looking at finance, how the offshore economy was received in local communities in the Caribbean, and that got me interested thinking more deeply about money. How do people understand money? How do they use money to express ideologies or to foster relationships?

In 2007/2008 I researched the interface between money and new technologies. When Bitcoin came along, I was in the middle of a study about mobile phones and money in sub-Saharan Africa. We were thinking about the implications of mobile phones on money. How do digital transactions change the conversations about mobile money, not in terms of security or encryption, but more in terms of cultural effects?

And then came Bitcoin. I remember clearly: I was sitting in a cafe, working on something else with my students. Then someone told us about Bitcoin, we downloaded the original Satoshi whitepaper describing the concept, and from the beginning it was clear that we’d have to research this.

What was the question of your research?

The first questions were: What is it? And why is it so interesting for people? We talked to technologists and scientists and found out that Bitcoin promises a future of nearly real time transactions, but in fact it will never be as fast as credit cards. And yet it is something a lot of people are interested in and invested money in. Why? What can Bitcoin tell us about money in the early 21th century? Why are people talking about money again?

Why in this specific historical moment had money become an issue again? How was Bitcoin capturing so much attention in this moment in the history of money.

One of the most disturbing experiences most people make with Bitcoin is that nobody is neutral. Everybody seems to be ideologically and emotionally involved. Did you find an explanation why?

Yes, I feel the same. The high level of emotional investment tells you something about the fact that money right now is being profoundly ungrounded. It is up for question. Since the end of World War II money had been relatively stable in people’s minds. But with the rise of the Internet and mobile and social computing, people are starting to think, if money is just data, just bits and bytes, can we remake money? How can we make it different? How can we think about it and value it?

There have been several different ways of thinking about money, different theories. Bitcoin reflects one of them. For several centuries the state was in the possession of the means of money making, but with the Internet, we can do it ourselves. This is not an idea Bitcoin brought into the world, it has existed for some time. Do you know the LETS movement?

No, what is it?

It stands for Local Exchange Trading System.

Ah, in Germany we call it “Tauschring”, I think.

Yes, wikipedia confirms this. Bitcoin is very similar to them. The LETS usually depend on a central account keeper. Bitcoin is similar in that it depends on accounts-keeping, but it eliminates the need for a central authority keeping track of transactions. So one strand of Bitcoin is very much like LETS, communitarian and mutualistic, but in the same time, and that’s a point of contradiction, Bitcoin is doing this without the need for trust. Community means usually trust, trust in leaders, in the people making up the community, but in Bitcoin it’s just trust in code.

On the other side, what is also interesting with Bitcoin, is that it continues a long history of thinking money as a natural commodity like gold.

What does that mean?

This line of thought thinks that money to be valuable it needs to be a commodity and it needs to be scarce. In the history of money this is a weird decision.

Sorry? What?

Continue reading on bitcoinblog.de: https://bitcoinblog.de/2016/07/27/it-tells-you-something-about-the-fact-that-money-right-now-is-being-profoundly-ungrounded-it-is-up-for-question/