Before The Beatles became the most popular band of all time, they were mainstays at a hole-in-the-wall club in Liverpool called The Cavern. Between 1961 and 1963, the boys would play rock-n-roll nightly to a small but dedicated audience of fans. Those lucky enough to see The Beatles during this period understood they were witnessing something special and spread word of the band to their friends. Over time, the crowds grew bigger, and The Beatles eventually became too popular for their hometown venue. Not six months after playing their last show at the Cavern, they had a number one record and were playing to millions on the Ed Sullivan show. That’s hyper-Beatlization for you.
This post is part of CoinDesk’s 2020 Year in Review – a collection of op-eds, essays and interviews about the year in crypto and beyond. Justin Wales is a lawyer and the co-chair of Carlton Fields’ national blockchain and virtual currency practice. He is the author of “Bitcoin is Speech Notes Toward Developing the Conceptual Contours of Its Protection Under the First Amendment.”
I assure you this article is about Bitcoin.
For those lucky enough to see The Beatles in Liverpool, watching them go on to become “bigger than Jesus” must have been a mixed bag. Seeing something you loved first become accepted by the entire world is validating, but it also means that thing is no longer just for you. You now have to share it with the world and that risks it losing the qualities that attracted you to it in the first place. Before you know it, your favorite band is just a corporate brand used to sell socks.
Thinking about what it was like to watch The Beatles play some grimy bar is a good analogy to what many Bitcoiners are going through at this very moment. In the last few months, it feels like the venue has gotten crowded and that it’s time for Bitcoin to leave to conquer the world.
New voices have entered the space and have changed the way we talk about Bitcoin. The conversation is dominated by those speculating about bitcoin’s use as an investment vehicle for the already wealthy. Fewer and fewer people preach its role as a tool for democratizing finance. It is essential that throughout this bull run, as we celebrate the rewards that come with being at the right place at the right time, that we remember what makes Bitcoin unique and fight like hell to keep it that way.
Bitcoin is a network. That’s its magic. It isn’t like a stock or a bond or even like gold. It is just a powerful system that allows people all over the world to privately interact with one another in a manner that is wholly unconcerned with whether any institution or government likes it or not.
That is the revolution.
Bitcoin is not large PayMent [trademarked] processors allowing its customers to purchase, but never hold, bitcoin directly or the marginal efficiencies available to those wishing to transfer millions of dollars between corporate treasuries. Those types of things, and the general influx of institutional investors looking for a hedge against the dollar are fine and maybe even necessary for hyper-Bitcoinization to occur, but it’s not what makes Bitcoin special.
The ability to directly and discreetly transact with one another is what makes Bitcoin special. It is imperative on all of us lucky fools who got to see Bitcoin when it was still playing at the Cavern to remind people why that was, and is still, so important.
The next year will be a lot of fun, but also a time when many new voices will be given a space to propose ways to take Bitcoin mainstream. In the goal of attracting institutional investors, many will cheer on regulations that undercut our ability to transact with Bitcoin without institutional or governmental approval. In other words, regulations that aim to change the fundamental characteristic that made Bitcoin special in the first place.
We already see this happening with rumors of impending regulations on the ability to send funds to self-hosted wallets from money service businesses and exchanges. Such restrictions are bad for Bitcoin and privacy generally and will require a lot more than retweets to be stopped. With your newfound gains, I recommend donating money to groups like Coin Center that fund research and advocacy focused on upholding the principles of liberty and privacy that were so vital to Bitcoin’s founding.
As bitcoin becomes corporatized, it is imperative that its first objective of democratizing finance through disintermediation endures.
One last thing about the Beatles: I do genuinely love them. There is no better music made as far as I am concerned. Because being a Beatles fan is so core to my identity, I have been gifted a lot of Beatles merchandise over the years. Last year, someone bought me a collection of officially licensed Beatles dress socks back before virus regulations shuttered my law office. Not 10 minutes after I put on a pair of these socks, I felt a tear, and sure enough, I tore a hole in the sock. I sat there looking down at my big toe popping out of John Lennon’s torso under the words “REVOLUTION.” I realized right then that these socks had nothing to do with The Beatles. It was just a product created to make a buck without offering me anything that made The Beatles special other than its branding.
It was a product masquerading as something revolutionary. How pathetic.
My bet is Bitcoin will be around for a long, long time. As large institutions and the CNBC crowd continue to recognize it as an investment opportunity, there will be an increasing number of ways for people to interact with “Bitcoin.” But at some point, we’re going to need to ask ourselves whether the things we brand as bitcoin are so centralized and overregulated that they no longer work toward achieving Bitcoin’s original goal of spurring a financial revolution.
As these “bitcoins” become corporatized and regulated into the mainstream, it is imperative that Bitcoin’s first objective of democratizing finance through disintermediation endures. The alternative is Bitcoin loses the very innovative principles that allowed it to grow in the first place and becomes just another product masquerading as something revolutionary. How pathetic would that be?