Is bitcoin more than just a way to spend money online?

Is bitcoin more than just a way to spend money online?

A recent gathering of cryptocurrency and blockchain experts in Vilnius, Lithuania provided the backdrop for a number of panel discussions focusing on the future of blockchain as both a technology and a philosophy. One of those panel discussions was the focus of a story published by Crypto News in late January (2019).

Though Coinbet.com is a website mainly devoted to bitcoin gambling and the casinos offering it, we are nonetheless very interested in cryptocurrency in light of the fact that gambling with bitcoins and other digital tokens is becoming increasingly more popular. We can see the potential of marrying online gambling with cryptocurrency to create more opportunities for more people. Thus, we are interested in things like the Vilnius panel discussions.

That brings us back to the recent discussions mentioned in the Crypto News article. The question we have is the same question that remained unanswered by the gathering's attendees: is blockchain a technology, philosophy, or both?

If it is just a technology, that could mean good things for online gambling. If it's just a philosophy, blockchain will not do much more for online gambling that it already has. If it's both, who knows?

The technology point of view

Seeing blockchain only as a technology is pretty common. Just do an internet search on the word 'blockchain' and then browse the first dozen or so results. You will see blockchain referenced as a technology probably more times than you can count.

Blockchain is considered a technology because it is substantively nothing more than computer code. It is not really a tangible product that you can hold in your hands. It is not a business model on which you can build a global empire. It isn't even an economic system. Blockchain is just a coding tool on which to build applications.

It just so happens that Bitcoin's application is a monetary system only. The application that is Bitcoin allows for buying and selling bitcoins represented as digital tokens within the computer code. But Bitcoin represents just one of literally thousands of applications now built on blockchain.

No need to regulate

One of the panel members mentioned in the Crypto News story made the salient point that blockchain does not need to be regulated if it's just a technology. He made mention of the fact that governments typically only regulate the misuse of certain technologies that cause harm to others. But the technologies themselves are considered benign by regulators.

Assuming such assertions are true, it would make perfect sense to say that cryptocurrencies built on blockchain technology need not be regulated either. People should be left alone to do with their digital tokens as they see fit. If you want to deposit bitcoins to play MegaMoolah.com, you should be able to do so without any interference.

This is not to say that laundering the profits of illegal activities through cryptocurrency transactions should be allowed. It should not be. But that is a matter of regulating an activity that's already illegal - money laundering - not regulating cryptocurrency itself.

So it would seem that the 'blockchain is a technology' argument is quite strong. But those who see it as a philosophy make some good points as well.

The philosophy point of view

Some people who do not see blockchain as a technology point out the fact that it really is, in the simplest terms possible, just an electronic ledger that accumulates and verifies data in a somewhat unique manner. They see it as differing very little from any other kind of electronic ledger in function. As such, the only thing that makes blockchain unique from a coding standpoint is how the code actually accomplishes the work it is designed to do.

This justifies the idea that blockchain is a philosophy. It is a principled way of recording, processing, and protecting data to ensure both security and freedom. And make no mistake, 'security' and 'freedom' are the key operative words here.

At the core of the blockchain concept is decentralization. That is where the freedom comes in. All indications suggest that Bitcoin's developer, Satoshi, was more interested in decentralization and economic freedom than anything else. So he designed his code around those two things.

In order to ensure both decentralization and freedom without risking the financial assets of coin holders, he also had to build security into his blockchain. The end result is a system with one fundamental goal: to provide a secure digital platform through which individuals can exercise economic freedom outside the control of government and centralized banks. Sounds pretty philosophical, doesn't it?

Impossible to regulate

It might be more difficult to wrap your brain around blockchain being a philosophy rather than a technology. But know this: while there is no need to regulate blockchain if it is a technology, it is impossible to regulate it if it is a philosophy. Attempting to do so is little more than thought control.

Every philosophy that humanity has ever known has started as a thought in a single person's mind. Thoughts travel from person to person by way of regular communication. Moreover, as thoughts are passed down the line they can grow and expand to become philosophies. That appears to be the case with blockchain. The philosophy of economic freedom through decentralization and security has taken on a life of its own.

The thing is, you cannot stop people from adhering to a specific philosophy. You cannot stop them from thinking whatever they want to think. If blockchain truly is a philosophy, no amount of regulation will ever stamp it out. There will always be those people who believe in it for purposes of economic freedom. And by the way, economic freedom is a philosophy as old as man himself.

A combined point of view

If you take the time to really study blockchain it becomes increasingly more difficult to take one side over the other. So perhaps the idea that blockchain is both a technology and a philosophy is more closely aligned with the truth. Let us take a look at why that might be the case.

Let's just assume for the moment that blockchain is just a technology. Like any other technology, blockchain would then be open to a certain kind of evolution that could eventually pull it away from its roots. We are already seeing glimpses of this beginning to emerge.

A number of national governments are now working on their own digital currency platforms that could one day take the place of fiat currency. But in order to replace fiat with digital tokens, a government has to maintain control over its blockchain. It also must include a central bank capable of addressing monetary policy. Yet once you do that, you remove one of the core principles of Bitcoin's original blockchain: decentralization.

Blockchain evangelists would argue, and rightly so, that any such cryptocurrency is not true to the original intent as put forth by Bitcoin's original developer. Government developers would have a useful technology for a national token to replace fiat, but it would be a technology that left behind the core principles of blockchain as a monetary system.

On the other hand, there are other consequences created by blockchain if it is just a philosophy. And once again, we are already seeing some of these consequences emerging. Just take a look at how corporations are using blockchain to improve internal operations.

If you maintain that blockchain is a philosophy only, then maintaining that philosophy in its purest form changes the way a corporation could use blockchain. A philosophy of complete decentralization and permissionless access would prevent a company from setting up a system that was closed and permissioned. After all, a restricted blockchain would be in violation of the original philosophy behind it.

Blockchain is fluid and changing

After all of this analysis it would appear as though blockchain really is both a technology and a philosophy. But it goes further than that. Blockchain is also fluid and ever changing. It has to be.

Like any technology, blockchain has to constantly adapt to the surrounding technology environment. It gets left behind if it doesn't. And just like any other philosophy, the principles of blockchain evolve as new ideas are introduced by multiple contributors who possess different points of view.

To cling to blockchain as a technology only is to ignore the important philosophical foundations it is built on. Anyone who uses bitcoins to play MegaMoolah.com can understand the implications of removing the philosophical elements of the Bitcoin blockchain.

Likewise, clinging to blockchain as a philosophy only limits our ability to adapt it to changing technology. That would ultimately inhibit developing blockchain much further than it has already been developed, eventually making it an obsolete platform that no longer has practical application.

The best way to approach blockchain is to embrace it as both a technology and a philosophy. Develop the technology as far as it will go within the general constraints of its underlying philosophy. And as both technology and philosophy evolve, let blockchain evolve right along with it. If the blockchain world can adopt and maintain that kind of mindset, all will be well.

Byline: This article was published by Henry.
About: I'm a bitcoin advocate and admin of Coinbet.com.