Bitcoin With Jake 001: Adoption in Cuba; demonetising warfare; and the energy fallacy.

This week: a new generation of empowered Bitcoiners in Cuba; world peace might be just around the corner; energy consumption criticism is over-hyped and poorly informed.

Adoption in Cuba

A new generation of empowered Bitcoiners in Cuba

In 2017 my wife and I were fortunate to visit Cuba, a wonderful experience with some of the friendliest people I have ever met, in spite of the challenging economic situation there. Interestingly the only hiccup to the trip was the freezing of my Coinbase account, apparently opening the app on Cuban soil was in breach of US sanctions, for a few weeks I thought checking my bitcoin balance might have had them confiscated forever!

This experience was front of mind on reading Alex Gladstein’s excellent essay “Inside Cuba’s Bitcoin Revolution”, which shows Bitcoin has certainly had an impact in Cuba since my visit, with one interviewee admitting “I can’t imagine my life right now without Bitcoin.”

After years of centralised financial planning, and woeful economic performance, it’s extremely exciting to see a generation of Cubans empowered by Bitcoin. In fact it’s this user profile that makes me most bullish as a Bitcoiner, people struggling on the fringe of today’s exclusive financial system, flocking to Bitcoin for it’s ability to improve their daily lives.

Demonetising warfare

World peace might be just around the corner

What if we had a way of ending warfare? Not another “war to end all wars”, but a tool that enabled peace, and unlocked a future of global prosperity. Jason Lowry is an unlikely source for a solution, as a member of the US military, however he makes the case that Bitcoin has the potential to make warfare redundant.

Central to this insight is the acknowledgement war is used to assert property ownership, with the most powerful military enforcing their currency on the subjugated, meaning war is a vehicle for economic self-interest.

What if the design of Bitcoin means you do not need war to assert property ownership? This is a big idea, prompting Max Keiser’s fitting description of Bitcoin as a “Love Bomb”, leaving me eager to learn more.

Energy fallacy

Energy consumption criticism is over-hyped and poorly informed

Not a week goes by without someone slamming Bitcoin for its energy consumption, which is why Hass Mccook’s transparent analysis caught my attention, highlighting nicely how much of a fallacy this rhetoric really is; Bitcoin’s energy footprint is tiny compared to major industry.

Indeed, the criticism levelled at Bitcoin for energy consumption is further flawed, when you consider the behaviours its design incentivises. Bitcoin as a ‘hard money’ is a deflationary asset, meaning its purchasing power increases over time, so people choose to save rather than spend their money.

For me this means that reckless consumption will be curbed in a ‘hyperbitcoinised’ economy, and long-term thinking will once again be prevalent, undoubtedly a boon for natural resource optimisation. I would even go as far as saying Bitcoin adoption is the most important sustainability solution available today!