Cryptocurrency: How Crypto Applies to the Sovereign Individual (Book)

[grarpamp]

https://news.bitcoin.com/how-bitcoin-applies-to-the-sovereign-individual-thesis/
https://www.amazon.com/Sovereign-Individual-Mastering-Transition-Information/dp/0684832720

How Bitcoin Applies to The Sovereign Individual Thesis

Just before the internet became a massive display of human ingenuity
and networking, a few individuals anticipated the emergence of tools
that would help progress the end of politics and the nation states. 22
years ago, much like Nostradamus, Isaac Newton, Gerald Celente, and
Carl Jung’s forecasts, a book called “The Sovereign Individual”
predicted the growing autonomy of the individual but also noted the
development of the world’s largest economy flourishing in cyberspace.

Cryptologic Methods Will Fundamentally Alter the Nature of
Interference in Economic Transactions

Since the inception of Satoshi Nakamoto’s Bitcoin, many people have
come to believe that cryptographic technology is meant to progress
freedom and liberty by separating money from the state. The concept is
similar to when the church was separated from the state but when the
power of the church dissipated, the nation states quickly took its
place. Cryptocurrencies now provide the means to transact financially
without a middleman and this removes the great wealth of power from
the state’s arsenal. More than two decades ago, the cypherpunks
started spreading the seeds of crypto-anarchy after envisioning that
the internet would help remove the parasites that stem from
governments.

What’s the Sovereign Individual VC thesis?

- Cryptocurrency (decoupling of money & state)
- Defense companies (unbundling state monopoly on violence)
- Charter cities (markets for governance)
- Influencer economy (trust shifting from institutions to individuals)

“Just as the technology of printing altered and reduced the power of
medieval guilds and the social power structure, so too will
cryptologic methods fundamentally alter the nature of corporations and
of government interference in economic transactions,” cypherpunk
Timothy May wrote in 1988. Humans have always tried to predict the
future and forecasting trends has been popular since medieval times.
People predicted the world wars decades beforehand, global economies
collapsing, and monumental events that have changed society a great
deal years before they happened.

Most people know about the cypherpunks from Silicon Valley and the
great crypto-anarchist manifestos that were published at this time. In
addition to these new philosophers, in 1997 two well-known investment
advisors and authors, James Dale Davidson and Lord William Rees-Mogg,
published a book that also predicted a huge change coming to society
over the next century. Within the book of forecasts, the two authors
of “The Sovereign Individual” predicted the coming of cryptocurrencies
and economic realignment. Rees-Mogg and Davidson’s book does not
specifically mention Bitcoin, because it was published 12 years prior
to the cryptocurrency’s inception. However, the predictions do note
the coming existence of an uncontrollable “cybercash” and that with
technology “we will see the growing autonomy of the individual and
taxing capacity will plunge by 50-70 percent.”

“[Society will] develop what promises to be the world’s largest
economy by the second decade of the new millennium,” The Sovereign
Individual states. If we were to look at the invention of Bitcoin as
being part of the Sovereign Individual’s timeline, we can see that
things are just getting started. The cryptoconomy, for instance, is a
$200 billion dollar economy that is not backed by a sole individual or
endorsed by a corporate entity. Governments do not support the
electronic borderless money, and ever since it was created the nation
states have met the technology with adversity.

How the Information Age and Bitcoin Resets the Odds

The open web has allowed online economies to flourish and financial
epicenters like New York and technological regions like Silicon Valley
have no hierarchy over the internet’s borderless and faceless power.
Governments feel threatened by these technologies and The Sovereign
Individual’s predictions suggest that the nation states will push back
just like the church did. At the time, during “its predominant
institution, the church, saw its monopoly challenged and shattered —
authority that had been unquestioned for centuries was suddenly in
dispute,” Rees-Mogg and Davidson’s book highlights. The Sovereign
Individual’s timeline predicts the next millennium will be very
similar. With economic tools like cryptocurrencies and other forms of
technological advances like autonomous software, drones, defense
groups, meshnet technology, Tor, VPNs, and influencer/gig economies,
society can begin to remove the bureaucracy from their everyday lives.
Davidson and Rees-Mogg’s novel states:

    We believe that change as dramatic as that of five hundred years
ago will happen again. The Information Revolution will destroy the
monopoly of power of the nation-state as surely as the Gunpowder
Revolution destroyed the church’s monopoly — Like the late-medieval
church, the nation state at the end of the twentieth century is a
deeply indebted institution that can no longer pay its way. Its
operations are ever more irrelevant and even counterproductive to the
prosperity of those who not long ago might have been its staunchest
supporters.

The Future Is Now

Right now, many people believe we are entering the initial phase of
change that books like The Sovereign Individual predicted decades ago.
On page 160 of the book, the two authors stress that as commerce takes
hold on the internet “it will lead inevitably to cybermoney.” This new
form of money Rees-Mogg and Davidson explain will “reset the odds,
reducing the capacity of the world’s nation-states.” “Unique,
anonymous, and verifiable, this money will accommodate the largest
transactions. It will also be divisible into the tiniest fraction of
value. It will be tradable at a keystroke in a multi-trillion-dollar
wholesale market without borders.”

It is interesting to watch the forecasts written years ago come to
fruition and especially ones that are changing society for the better.
The advent of Bitcoin and the economy behind the thousands of digital
assets out there shows that a massive transformation is indeed
happening right now. Past predictions from the cypherpunks and books
like The Sovereign Individual may help us understand why. Moreover,
failing economies and protests worldwide clearly indicate the demand
for freedom is just getting started.