gc-alexandria/test_data/AsciidocFiles/21lessons.adoc

= 21 Lessons

== Title Page

[.text-center]
*21 Lessons, by Gigi*
[.text-center]
What I've Learned from Falling Down the Bitcoin Rabbit Hole
[.text-center]
Independently published 18. Dezember 2019.

[quote]
"Oh, you foolish Alice!" she said again, "how can you learn lessons in here? Why, there's hardly room for you, and no room at all for any lesson-books!"

== License

Unless otherwise noted, all my writings are published under the https://creativecommons.org/licenses/by-sa/4.0/[Creative Commons Attribution-ShareAlike 4.0 International] (CC BY-SA 4.0) license and provided on a https://dergigi.com/value[V4V] basis.

This means that you are free to share and adapt the material as you see fit.

*The only requirement is that you must give attribution and distribute your contributions under the same license.*

[NOTE]
====
This edition of "21 Lessons" has been produced for publication on Nostr, with expressed permission by the author nostr:npub1dergggklka99wwrs92yz8wdjs952h2ux2ha2ed598ngwu9w7a6fsh9xzpc, who goes by the Nostr handle Der Gigi.

You can support the author's efforts, at educating the public about the importance and necessity of Bitcoin, by https://nostree.me/npub1dergggklka99wwrs92yz8wdjs952h2ux2ha2ed598ngwu9w7a6fsh9xzpc[zapping his Nostr profile] or his lightning wallet:

image::https://dergigi.com/assets/images/bitcoin/bolt12.png[lightning wallet, 300, align="center"]

`lno1zrxq8pjw7qjlm68mtp7e3yvxee4y5xrgjhhyf2fxhlphpckrvevh50u0qfdq0py8fu308448hm6eqvc5d8p82fg077wgs45zd64qx6gplv66uqsz2j4zmyh3akkv5p2upsru9spjmk52kflevpuawzjzg7qp27apqdxqqvewrayeh06nj3t8ymq4l97ef2cf670j7sw0kffhf6vrjzqr7u823tvkv246cn6czjtdkzsp6j6d5u8a7fwpqg2v3ed96cv2jftsg08waexw2pwycp8fyny59mtgvdnvepss5l2egqqs628487l8dskakc9sfunelwvwr5`

-- The editor

====

== Preface

[quote]
____

Little Alice fell

d

o

w

n

the hOle,

bumped her head

and bruised her soul.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/0-00.m4a[Audio. Read by Guy Swan]

Falling down the Bitcoin rabbit hole is a strange experience. Like many others, I feel like I have learned more in the last couple of years studying Bitcoin than I have during two decades of formal education.

The following lessons are a distillation of what I’ve learned. First published as an article series titled https://dergigi.com/2018/12/21/philosophical-teachings-of-bitcoin/["What I’ve Learned From Bitcoin,”] what follows can be seen as a second edition of the original series.

Like Bitcoin, these lessons aren’t a static thing. I plan to work on them periodically, releasing updated versions and additional material in the future.

Unlike Bitcoin, future versions of this project do not have to be backward compatible. Some lessons might be extended, others might be reworked or replaced. I hope that a future version will be something you can hold in your hands, but I don’t want to promise anything just yet.

Bitcoin is an inexhaustible teacher, which is why I do not claim that these lessons are all-encompassing or complete. They are a reflection of my personal journey down the rabbit hole. There are many more lessons to be learned, and every person will learn something different from entering the world of Bitcoin.

I hope that you will find these lessons useful and that the process of learning them by reading won’t be as arduous and painful as learning them firsthand.

== Table of Contents

[quote]
____

"Would you tell me, please, which way I ought to go from here?"

"That depends a good deal on where you want to get to."

"I don't much care where –"

"Then it doesn't matter which way you go."
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/0-01.m4a[Audio. Read by Guy Swan]

.Table of Contents

* Title Page
* License
* Preface
* Introduction
* Chapter I : Philosophy
** Lesson 1 : Immutability and change
** Lesson 2 : The scarcity of scarcity
** Lesson 3 : Replication and locality
** Lesson 4 : The problem of identity
** Lesson 5 : An immaculate conception
** Lesson 6 : The power of free speech
** Lesson 7 : The limits of knowledge
* Chapter II : Economics
** Lesson 8 : Financial ignorance
** Lesson 9 : Inflation
** Lesson 10 : Value
** Lesson 11 : Money
** Lesson 12 : The history and downfall of money
** Lesson 13 : Fractional Reserve Insanity
** Lesson 14 : Sound money
* Chapter III : Technology
** Lesson 15 : Strength in numbers
** Lesson 16 : Reflections on "Don't Trust, Verify"
** Lesson 17 : Telling time takes work
** Lesson 18 : Move slowly and don't break things
** Lesson 19 : Privacy is not dead
** Lesson 20 : Cypherpunks write code
** Lesson 21 : Metaphors for Bitcoin's future
* Conclusion
* Acknowledgments
* Thank You
* Translations
* Readings and Commentary
* Down the Rabbit Hole

== Introduction
:figure-caption!:

[quote]
____

"But I don’t want to go among mad people," Alice remarked.

"Oh, you can’t help that," said the Cat: "we’re all mad here. I’m mad. You’re mad."

"How do you know I’m mad?" said Alice.

"You must be," said the Cat, "or you wouldn’t have come here."
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/0-02.m4a[Audio. Read by Guy Swan]

In October 2018, Arjun Balaji asked the innocuous question, https://twitter.com/arjunblj/status/1050073234719293440["What have you learned from Bitcoin?"] After trying to answer this question in a short tweet, and failing miserably, I realized that the things I’ve learned are far too numerous to answer quickly, if at all.

The things I’ve learned are, obviously, about Bitcoin - or at least related to it. However, while some of the inner workings of Bitcoin are explained, the following lessons are not an explanation of how Bitcoin works or what it is, they might, however, help to explore some of the things Bitcoin touches: philosophical questions, economic realities, and technological innovations.

The 21 lessons are structured in bundles of seven, resulting in three chapters. Each chapter looks at Bitcoin through a different lens, extracting what lessons can be learned by inspecting this strange network from a different angle.

*Chapter 1* explores the philosophical teachings of Bitcoin. The interplay of immutability and change, the concept of true scarcity, Bitcoin’s immaculate conception, the problem of identity, the contradiction of replication and locality, the power of free speech, and the limits of knowledge.

*Chapter 2* explores the economic teachings of Bitcoin. Lessons about financial ignorance, inflation, value, money and the history of money, fractional reserve banking, and how Bitcoin is re-introducing sound money in a sly, roundabout way.

*Chapter 3* explores some of the lessons learned by examining the technology of Bitcoin. Why there is strength in numbers, reflections on trust, why telling time takes work, how moving slowly and not breaking things is a feature and not a bug, what Bitcoin’s creation can tell us about privacy, why cypherpunks write code (and not laws), and what metaphors might be useful to explore Bitcoin’s future.

Each lesson contains several quotes and links throughout the text. If I have explored an idea in more detail, you can find links to my related works in the “Through the Looking-Glass” section. If you like to go deeper, links to the most relevant material are listed in the “Down the Rabbit Hole” section. Both can be found at the end of each lesson.

Even though some prior knowledge about Bitcoin is beneficial, I hope that these lessons can be digested by any curious reader. While some relate to each other, each lesson should be able to stand on its own and can be read independently. I did my best to shy away from technical jargon, even though some domain-specific vocabulary is unavoidable.

I hope that my writing serves as inspiration for others to dig beneath the surface and examine some of the deeper questions Bitcoin raises. My own inspiration came from a multitude of authors and content creators to all of whom I am eternally grateful.

Last but not least: my goal in writing this is not to convince you of anything. My goal is to make you think, and show you that there is way more to Bitcoin than meets the eye. I can’t even tell you what Bitcoin is or what Bitcoin will teach you. You will have to find that out for yourself.

[quote, Morpheus, The Matrix]
“After this, there is no turning back. You take the blue pill  —  the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill  —  you stay in Wonderland, and I show you how deep the rabbit hole goes.”

image::https://21lessons.com/assets/images/bitcoin-orange-pill.jpg[red pill, 300, align="center"]

== Chapter I - Philosophy
:figure-caption!:

[quote]
___
The mouse looked at her rather inquisitively, and seemed to her to wink with one of its little eyes, but it said nothing.
___

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-00.m4a[Audio. Read by Guy Swan]

Looking at Bitcoin superficially, one might conclude that it is slow, wasteful, unnecessarily redundant, and overly paranoid. Looking at Bitcoin inquisitively, one might find out that things are not as they seem at first glance.

Bitcoin has a way of taking your assumptions and turning them on their heads. After a while, just when you were about to get comfortable again, Bitcoin will smash through the wall like a bull in a china shop and shatter your assumptions once more.

.Blind monks examining the Bitcoin bull

image::https://21lessons.com/assets/images/blind-monks.jpg[Blind monks examining the Bitcoin bull, 300, align="center"]

Bitcoin is a child of many disciplines. Like blind monks examining an elephant, everyone who approaches this novel technology does so from a different angle. And everyone will come to different conclusions about the nature of the beast.

The following lessons are about some of my assumptions which Bitcoin shattered, and the conclusions I arrived at. Philosophical questions of immutability, scarcity, locality, and identity are explored in the first four lessons.

* Lesson 1: Immutability and change
* Lesson 2: The scarcity of scarcity
* Lesson 3: Replication and locality
* Lesson 4: The problem of identity
* Lesson 5: An immaculate conception
* Lesson 6: The power of free speech
* Lesson 7: The limits of knowledge

Lesson 5 explores how Bitcoin’s origin story is not only fascinating but absolutely essential for a leaderless system. The last two lessons of this chapter explore the power of free speech and the limits of our individual knowledge, reflected by the surprising depth of the Bitcoin rabbit hole.

I hope that you will find the world of Bitcoin as educational, fascinating and entertaining as I did and still do. I invite you to follow the white rabbit and explore the depths of this rabbit hole. Now hold on to your pocket watch, pop down, and enjoy the fall.

== Lesson 1 - Immutability and change
:figure-caption!:

[quote]
____

I wonder if I've been changed in the night. Let me think. Was I the same when I got up this morning? I almost think I can remember feeling a little different. But if I'm not the same, the next question is 'Who in the world am I?' Ah, that's the great puzzle!
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-01.m4a[Audio. Read by Guy Swan]

Bitcoin is inherently hard to describe. It is a _new thing_, and any attempt to draw a comparison to previous concepts  —  be it by calling it digital gold or the internet of money  —  is bound to fall short of the whole. Whatever your favorite analogy might be, two aspects of Bitcoin are absolutely essential: decentralization and immutability.

One way to think about Bitcoin is as an https://medium.com/@hasufly/bitcoins-social-contract-1f8b05ee24a9[automated social contract]. The software is just one piece of the puzzle, and hoping to change Bitcoin by changing the software is an exercise in futility. One would have to convince the rest of the network to adopt the changes, which is more a psychological effort than a software engineering one.

The following might sound absurd at first, like so many other things in this space, but I believe that it is profoundly true nonetheless: You won’t change Bitcoin, but Bitcoin will change you.

[quote, Marty Bent]
“Bitcoin will change us more than we will change it.”

It took me a long time to realize the profundity of this. Since Bitcoin is just software and all of it is open-source, you can simply change things at will, right? Wrong. _Very_ wrong. Unsurprisingly, Bitcoin’s creator knew this all too well.

[quote, Satoshi Nakamoto]
“The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.”

Many people have attempted to change Bitcoin’s nature. So far all of them have failed. While there is an endless sea of forks and altcoins, the Bitcoin network still does its thing, just as it did when the first node went online. The altcoins won’t matter in the long run. The forks will eventually starve to death. Bitcoin is what matters. As long as our fundamental understanding of mathematics and/or physics doesn’t change, the Bitcoin honeybadger will continue to not care.

[quote, Ralph Merle]
“Bitcoin is the first example of a new form of life. It lives and breathes on the internet. It lives because it can pay people to keep it alive. […] It can’t be changed. It can’t be argued with. It can’t be tampered with. It can’t be corrupted. It can’t be stopped. […] If nuclear war destroyed half of our planet, it would continue to live, uncorrupted.“

The heartbeat of the Bitcoin network will outlast all of ours.

Realizing the above changed me way more than the past blocks of the Bitcoin blockchain ever will. It changed my time preference, my understanding of economics, my political views, and so much more. Hell, it is even https://motherboard.vice.com/en_us/article/ne74nw/inside-the-world-of-the-bitcoin-carnivores[changing people’s diets]. If all of this sounds crazy to you, you’re in good company. All of this is crazy, and yet it is happening.

Bitcoin taught me that it won’t change. I will.

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson:

* https://dergigi.com/2020/06/15/the-bitcoin-journey/[🔍 The Bitcoin Journey]

*Down the Rabbit Hole*

* http://www.contravex.com/2014/03/19/there-is-no-bitcoin-2-0[There is no Bitcoin 2.0], by Pete Dushenski
* https://alcor.org/cryonics/Cryonics2016-4.pdf#page=28[DAOs, Democracy and Governance], by Ralph C. Merkle
* https://motherboard.vice.com/en_us/article/ne74nw/inside-the-world-of-the-bitcoin-carnivores[Inside the World of the Bitcoin Carnivores - Why a small community of Bitcoin users is eating meat exclusively], by Jordan Pearson
* https://medium.com/s/story/bitcoins-social-contract-1f8b05ee24a9[Unpacking Bitcoin’s Social Contract], by Hasu
* https://medium.com/@BrandonQuittem/bitcoin-is-a-decentralized-organism-mycelium-part-1-3-6ec58cdcfaa6[Bitcoin is a Decentralized Organism], by Brandon Quittem
* https://medium.com/@BrandonQuittem/bitcoin-is-a-social-creature-mushroom-part-2-3-6a05c3abe8f0[Bitcoin is a Social Creature], by Brandon Quittem
* https://hugonguyen.medium.com/bitcoin-two-parts-math-one-part-biology-b45ef48a0422[Bitcoin - Two Parts Math, One Part Biology], by Hugo Nguyen
* https://medium.com/@nic__carter/its-the-settlement-assurances-stupid-5dcd1c3f4e41[It’s the settlement assurances, stupid], by Nic Carter
* https://bitcointalk.org/index.php?topic=195.msg1611#msg1611[Technical Discussion on Bitcoin’s Transactions and Scripts], by Satoshi Nakamoto, Gavin Andresen, and others
* https://tftc.io/martys-bent/[Marty’s Bent - A daily newsletter highlighting signal in Bitcoin], by Marty Bent
* 🎧 https://tftc.io/tales-from-the-crypt/[Tales From the Crypt], by Marty Bent
* 🎧 https://www.jordanbpeterson.com/podcast/s4e40/[John Vallis, Richard James, Gigi Der, Robert Breedlove on Bitcoin as The Future of Money], JBP#440 hosted by Jordan B. Peterson
* 📚 https://amzn.to/2w4MtRI[Antifragile - Things That Gain From Disorder], by Nassim Nicholas Taleb

== Lesson 2 - The scarcity of scarcity
:figure-caption!:

[quote]
____

That's quite enough — I hope I sha'n't grow any more...
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-02.m4a[Audio. Read by Guy Swan]

In general, the advance of technology seems to make things more abundant. More and more people are able to enjoy what previously have been luxurious goods. Soon, we will all live like kings. Most of us already do. As Peter Diamandis wrote in https://www.diamandis.com/abundance[Abundance]: “Technology is a resource-liberating mechanism. It can make the once scarce the now abundant.” Bitcoin, an advanced technology in itself, breaks this trend and creates a new commodity which is truly scarce. Some even argue that it is one of the scarcest things in the universe. The supply can’t be inflated, no matter how much effort one chooses to expend towards creating more. 

[quote, Saifedean Ammous]
“Only two things are genuinely scarce: time and bitcoin.”

Paradoxically, it does so by a mechanism of copying. Transactions are broadcast, blocks are propagated, the distributed ledger is  —  well, you guessed it  —  distributed. All of these are just fancy words for copying. Heck, Bitcoin even copies itself onto as many computers as it can, by incentivizing individual people to run full nodes and mine new blocks. All of this duplication wonderfully works together in a concerted effort to produce scarcity. In a time of abundance, Bitcoin taught me what real scarcity is.

'''

*Down the Rabbit Hole*

* https://medium.com/@100trillionUSD/modeling-bitcoins-value-with-scarcity-91fa0fc03e25[Modeling Bitcoin’s Value with Scarcity] by PlanB
* https://www.unchained-capital.com/blog/bitcoin-cant-be-copied/[Bitcoin Can’t Be Copied] by Parker Lewis
* https://www.bayernlb.de/internet/media/de/ir/downloads_1/bayernlb_research/sonderpublikationen_1/bitcoin_munich_may_28.pdf[Presentation on The Bitcoin Standard] by Saifedean Ammous
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-60-Misir-Mahmudov-e3aibh[Misir Mahmudov on the Scarcity of Time and Bitcoin] TFTC#60 hosted by Marty Bent
* 🎧 https://anchor.fm/podcast-8f267c0/episodes/Dollar-Cost-Average-with-BTCDCA-BEC020-e49o8b[BTCDCA on Dollar Cost Averaging Bitcoin] BEC#20 hosted by Collin
* 🎧 https://player.fm/series/off-the-chain-2428336/misir-mahmudov-analyst-at-adaptive-capital-why-bitcoin-is-stored-time[Misir Mahmudov on Bitcoin as Stored Time] OTC#126 hosted by Pomp
* 🎧 https://stephanlivera.com/episode/288/[Hass McCook on the importance of Auto-DCA]SLP#288 hosted by Stephan Livera
* 📚 https://amzn.to/2IJTb2y[Abundance - The Future is Better Than You Think] by Peter Diamandis
* 📚 https://amzn.to/2TLl5RP[The Bitcoin Standard - The Decentralized Alternative to Central Banking] by Saifedean Ammous

== Lesson 3
:figure-caption!:

[quote]
____
Next came an angry voice—the rabbit's—"Pat, Pat! where are you?"
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-03.m4a[Audio. Read by Guy Swan]

Quantum mechanics aside, locality is a non-issue in the physical world. The question _“Where is X?”_ can be answered in a meaningful way, no matter if X is a person or an object. In the digital world, the question of _where_ is already a tricky one, but not impossible to answer. Where are your emails, really? A bad answer would be “the cloud”, which is just someone else’s computer. Still, if you wanted to track down every storage device which has your emails on it you could, in theory, locate them. With bitcoin, the question of “where” is _really_ tricky. Where, exactly, are your bitcoins?

[quote, Daniel Dennet]
“I opened my eyes, looked around, and asked the inevitable, the traditional, the lamentably hackneyed postoperative question: ‘Where am l?’”

The problem is twofold: First, the distributed ledger is distributed by full replication, meaning the ledger is everywhere. Second, there are no bitcoins. Not only physically, but _technically_. Bitcoin keeps track of a set of unspent transaction outputs, without ever having to refer to an entity which represents a bitcoin. The existence of a bitcoin is inferred by looking at the set of unspent transaction outputs and calling every entry with 100 million base units a bitcoin.

[quote, Peter Van Valkenburgh]
“Where is it, at this moment, in transit? […] First, there are no bitcoins. There just aren’t. They don’t exist. There are ledger entries in a ledger that’s shared […] They don’t exist in any physical location. The ledger exists in every physical location, essentially. Geography doesn’t make sense here  —  it is not going to help you figuring out your policy here.”

So, what do you actually own when you say _“I have a bitcoin”_ if there are no bitcoins? Well, remember all these strange words which you were forced to write down by the wallet you used? Turns out these magic words are what you own: https://dergigi.com/2018/08/17/the-magic-dust-of-cryptography/[a magic spell] which can be used to add some entries to the public ledger  —  the keys to “move” some bitcoins. This is why, for all intents and purposes, your private keys _are_ your bitcoins. If you think I’m making all of this up feel free to send me your private keys. Bitcoin taught me that locality is a tricky business.

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2018/08/17/the-magic-dust-of-cryptography/[🔍 The Magic Dust of Cryptography - How digital information is changing our society]

*Down the Rabbit Hole*

* https://www.lehigh.edu/~mhb0/Dennett-WhereAmI.pdf[Where Am I?] by Daniel Dennett
* 🎧 https://www.whatbitcoindid.com/podcast/coin-centers-peter-van-valkenburg-on-preserving-the-freedom-to-innovate-with-public-blockchains[Peter Van Valkenburg on Preserving the Freedom to Innovate with Public Blockchains] WBD#49 hosted by Peter McCormack

== Lesson 4 - The problem of identity
:figure-caption!:

[quote]
____

"Who are you?" said the caterpillar.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-04.m4a[Audio. Read by Guy Swan]

Nic Carter, in an homage to Thomas Nagel’s treatment of the same question https://en.wikipedia.org/wiki/What_Is_it_Like_to_Be_a_Bat%3F[in regards to a bat], wrote an excellent piece which discusses the following question: https://medium.com/s/story/what-is-it-like-to-be-a-bitcoin-56109f3e6753[What is it like to be a bitcoin?] He brilliantly shows that open, public blockchains in general, and Bitcoin in particular, suffer from the same conundrum as the https://en.wikipedia.org/wiki/Ship_of_Theseus[Ship of Theseus]: which Bitcoin is the real Bitcoin?

[quote, Nic Carter]
“Consider just how little persistence Bitcoin’s components have. The entire codebase has been reworked, altered, and expanded such that it barely resembles its original version. […] The registry of who owns what, the ledger itself, is virtually the only persistent trait of the network […] To be considered truly leaderless, you must surrender the easy solution of having an entity that can designate one chain as the legitimate one.”

It seems like the advancement of technology keeps forcing us to take these philosophical questions seriously. Sooner or later, self-driving cars will be faced with real-world versions of the https://en.wikipedia.org/wiki/Trolley_problem[trolley problem], forcing them to make ethical decisions about whose lives do matter and whose do not. Cryptocurrencies, especially since the first contentious hard-fork, force us to think about and agree upon the metaphysics of identity. Interestingly, the two biggest examples we have so far have led to two different answers. On August 1, 2017, Bitcoin split into two camps. The market decided that the unaltered chain is the original Bitcoin. One year earlier, on October 25, 2016, Ethereum split into two camps. The market decided that the _altered_ chain is the original Ethereum. If properly decentralized, the questions posed by the _Ship of Theseus_ will have to be answered in perpetuity for as long as these networks of value-transfer exist. Bitcoin taught me that decentralization contradicts identity. 

'''

*Down the Rabbit Hole*

* https://en.wikipedia.org/wiki/What_Is_it_Like_to_Be_a_Bat%3F[What Is It Like to be a Bat?] by Thomas Nagel
* https://medium.com/s/story/what-is-it-like-to-be-a-bitcoin-56109f3e6753[Bitcoin’s Existential Crisis] by Nic Carter
* https://en.wikipedia.org/wiki/Ship_of_Theseus[Ship of Theseus] by Wikipedia Authors
* https://en.wikipedia.org/wiki/Trolley_problem[Trolley Problem] by Wikipedia Authors
* 🎧 https://stephanlivera.com/episode/75[Giacomo Zucco on Bitcoin's Identity and Copycats] SLP#75 hosted by Stephan Livera
* 📚 https://amzn.to/3d9cP7C[The Blocksize War - The Battle for Control over Bitcoin’s Protocol Rules] by Jonathan Bier

== Lesson 5 - An immaculate conception
:figure-caption!:

[quote]
____

"Their heads are gone," the soldiers shouted in reply...
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-05.m4a[Audio. Read by Guy Swan]

Everyone loves a good origin story. The origin story of Bitcoin is a fascinating one, and the details of it are more important than one might think at first. Who is Satoshi Nakamoto? Was he one person or a group of people? Was he a she? Time-traveling alien, or advanced AI? Outlandish theories aside, we will probably never know. And this is important. Satoshi chose to be anonymous. He planted the seed of Bitcoin. He stuck around for long enough to make sure the network won’t die in its infancy. And then he vanished. What might look like a weird anonymity stunt is actually crucial for a truly decentralized system. No centralized control. No centralized authority. No inventor. No-one to prosecute, torture, blackmail, or extort. An immaculate conception of technology.

[quote, Jimmy Song]
“One of the greatest things that Satoshi did was disappear.” 

Since the birth of Bitcoin, thousands of other cryptocurrencies were created. None of these clones share its origin story. If you want to supersede Bitcoin, you will have to transcend its origin story. In a war of ideas, narratives dictate survival.

[quote, Gold: The Extraordinary Metal]
“Gold was first fashioned into jewelry and used for barter over 7,000 years ago. Gold’s captivating gleam led to it being considered a gift from the gods.”

Like gold in ancient times, Bitcoin might be considered a gift from the gods. Unlike gold, Bitcoins origins are all too human. And this time, we know who the gods of development and maintenance are: people all over the world, anonymous or not. Bitcoin taught me that narratives are important.

'''

*Down the Rabbit Hole*

* https://medium.com/@francispouliot/catallaxy-the-origins-of-bitcoin-and-innovation-93dbc3190eac[Catallaxy - the origins of Bitcoin, innovation and spontaneous order] by Francis Pouliot
* https://medium.com/@jimmysong/why-bitcoin-is-different-e17b813fd947[Why Bitcoin is Different] by Jimmy Song
* https://www.uncerto.com/only-the-strong-survive[Only The Strong Survive] by Allen Farrington and Big Al
* https://www.forbes.com/sites/peterizzo/2021/09/29/against-cryptocurrency-the-ethical-argument-for-bitcoin-maximalism/[Against Cryptocurrency - The Ethical Argument for Bitcoin Maximalism] by Pete Rizzo
* https://www.muenzeoesterreich.at/eng/discover/for-investors/gold-the-extraordinary-metal[Gold - The Extraordinary Metal] by the Austrian Mint
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/162-Robert-Breedlove-ee9e6t[Robert Breedlove on Bitcoin and the Number Zero] TFTC#162 hosted by Marty Bent
* 🎧 https://youtu.be/FXvQcuIb5rU[Saifedean Ammous on Bitcoin's Immaculate Conception and the Fiat Standard] JBP#458 hosted by Jordan B. Peterson
* 📚 https://amzn.to/2vfz0Gn[The Black Swan - The Impact of the Highly Improbable] by Nassim Nicholas Taleb

== Lesson 6 - The power of free speech
:figure-caption!:

[quote]
____

"I beg your pardon?" said the mouse, frowning, but very politely, "did you speak?"
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-06.m4a[Audio. Read by Guy Swan]

Bitcoin is an idea. An idea which, in its current form, is the manifestation of a machinery purely powered by text. Every aspect of Bitcoin is text: The whitepaper is text. The software which is run by its nodes is text. The ledger is text. Transactions are text. Public and private keys are text. Every aspect of Bitcoin is text, and thus equivalent to speech.

[quote, First Amendment to the United States Constitution]
“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

Although the final battle of the https://en.wikipedia.org/wiki/Crypto_Wars[Crypto Wars] has not been fought yet, it will be very difficult to criminalize an idea, let alone an idea which is based on the exchange of text messages. Every time a government tries to outlaw text or speech, we slip down a path of absurdity which inevitably leads to abominations like https://en.wikipedia.org/wiki/Illegal_number[illegal numbers] and https://en.wikipedia.org/wiki/Illegal_prime[illegal primes]. As long as there is a part of the world where speech is free as in _freedom_, Bitcoin is unstoppable.

[quote, Beautyon]
“There is no point in any Bitcoin transaction that Bitcoin ceases to be _text_. It is _all text_, all the time. […] Bitcoin is *text.* Bitcoin is *speech.* It cannot be regulated in a free country like the USA with guaranteed inalienable rights and a First Amendment that explicitly excludes the act of publishing from government oversight.”

Bitcoin taught me that in a free society, free speech and free software are unstoppable.

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2019/08/22/the-rise-of-the-sovereign-individual/[🔍 The Rise of the Sovereign Individual - How power is re-aligning itself in an internet-native world]
* https://dergigi.com/2019/10/03/how-to-kill-bitcoin/[🔍 How to Kill Bitcoin]
* https://dergigi.com/2020/03/01/bitcoin-s-habitats/[🔍 Bitcoin's Habitats - How Bitcoin is surviving and thriving between worlds]
* https://dergigi.com/2021/08/02/implications-of-outlawing-bitcoin/[🔍 Implications of Outlawing Bitcoin]
* https://dergigi.com/2022/04/03/inalienable-property-rights/[🔍 Inalienable Property Rights - The Law, Language, Money, and Morality of Bitcoin]

*Down the Rabbit Hole*

* https://archive.is/yAOwZ[Why America Can’t Regulate Bitcoin] by Beautyon
* https://time.com/5486673/bitcoin-venezuela-authoritarian/?amp=true[Why Bitcoin Matters for Freedom] by Alex Gladstein
* https://medium.com/@nic__carter/a-most-peaceful-revolution-8b63b64c203e[A most peaceful revolution] by Nic Carter
* https://unchained-capital.com/blog/bitcoin-cannot-be-banned/[Bitcoin Cannot Be Banned] by Parker Lewis
* https://quillette.com/2021/02/21/can-governments-stop-bitcoin/[Can Governments Stop Bitcoin?] by Alex Gladstein
* https://en.wikipedia.org/wiki/Crypto_Wars[Crypto Wars] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Illegal_number[Illegal Numbers] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Illegal_prime[Illegal Primes] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/First_Amendment_to_the_United_States_Constitution[First Amendment to the United States Constitution] by Wikipedia Contributors
* http://www.philsalin.com/patents.html[Freedom of Speech in Software] by Phil Salin
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-29-Jameson-Lopp-e1qndr[Jameson Lopp on Freedom-Enabling Technologies like Bitcoin] TFTC#29 hosted by Marty Bent
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-76-Alex-Gladstein-e46v9e[Alex Gladstein on Bitcoin’s Role in the Fight for Human Rights] TFTC#76 hosted by Marty Bent

== Lesson 7 - The limits of knowledge
:figure-caption!:

[quote]
____
Down, down, down. Would the fall never come to an end?
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/1-07.m4a[Audio. Read by Guy Swan]

Getting into Bitcoin is a humbling experience. I thought that I knew things. I thought that I was educated. I thought that I knew my computer science, at the very least. I studied it for years, so I have to know everything about digital signatures, hashes, encryption, operational security, and networks, right?

Wrong.

Learning all the fundamentals which make Bitcoin work is hard. Understanding all of them deeply is borderline impossible.

[quote, Jameson Lopp]
“No one has found the bottom of the Bitcoin rabbit hole.”

My list of books to read keeps expanding way quicker than I could possibly read them. The list of papers and articles to read is virtually endless. There are more podcasts on all of these topics than I could ever listen to. It truly is humbling. Further, Bitcoin is evolving and it’s almost impossible to stay up-to-date with the accelerating rate of innovation. The dust of the first layer hasn’t even settled yet, and people have already built the second layer and are working on the third.

Bitcoin taught me that I know very little about almost anything. It taught me that this rabbit hole is bottomless.

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson:

* https://dergigi.com/2019/12/22/bitcoin-s-eternal-struggle/[🔍 Bitcoin's Eternal Struggle - How Bitcoin Thrives on the Edge between Order and Chaos]

*Down the Rabbit Hole*

* https://www.lopp.net/bitcoin-information.html[Bitcoin Information & Resources] by Jameson Lopp
* https://nakamotoinstitute.org/literature/[Bitcoin Literature] by Satoshi Nakamoto Institute
* https://bitcoin-only.com/#learning[Educational Resources] by Bitcoin Only
* https://bitcoin-intro.com/[Bitcoin Intro] by 6102bitcoin
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-7-Matt-Corallo-Pt--II-e1qneh[Matt Corallo on how Everyone is Ignorant when it comes to Bitcoin] TFTC#7 hosted by Marty Bent
* 🎧 https://anchor.fm/podcast-8f267c0/episodes/Bitcoin-Spectrum-with-Ben-Prentice-BEC014-e3q18t[Ben Prentice on the Bitcoin Spectrum] BEC#14 hosted by Collin

== Chapter II - Economics
:figure-caption!:

[quote]
___
A large rose tree stood near the entrance of the garden: the roses on it were white, but there were three gardeners at it, busily painting them red. This Alice thought a very curious thing...
___

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-00.m4a[Audio. Read by Guy Swan]

Money doesn’t grow on trees. To believe that it does is foolish, and our parents make sure that we know about that by repeating this saying like a mantra. We are encouraged to use money wisely, to not spend it frivolously, and to save it in good times to help us through the bad. Money, after all, does not grow on trees.

Bitcoin taught me more about money than I ever thought I would need to know. Through it, I was forced to explore the history of money, banking, various schools of economic thought, and many other things. The quest to understand Bitcoin lead me down a plethora of paths, some of which I try to explore in this series.

In the first seven lessons some of the philosophical questions Bitcoin touches on were discussed. The next seven lessons will take a closer look at money and economics.
 
* Lesson 8: Financial ignorance
* Lesson 9: Inflation
* Lesson 10: Value
* Lesson 11: Money
* Lesson 12: The history and downfall of money
* Lesson 13: Fractional Reserve Insanity
* Lesson 14: Sound money

Again, I will only be able to scratch the surface. Bitcoin is not only ambitious, but also broad and deep in scope, making it impossible to cover all relevant topics in a single lesson, essay, article, or book. I doubt if it is even possible at all.

Bitcoin is a new form of money, which makes learning about economics paramount to understanding it. Dealing with the nature of human action and the interactions of economic agents, economics is probably one of the largest and fuzziest pieces of the Bitcoin puzzle.

Again, these lessons are an exploration of the various things I have learned from Bitcoin. They are a personal reflection of my journey down the rabbit hole. Having no background in economics, I am definitely out of my comfort zone and especially aware that any understanding I might have is incomplete. I will do my best to outline what I have learned, even at the risk of making a fool out of myself. After all, I am still trying to answer the question: https://twitter.com/arjunblj/status/1050073234719293440[What have you learned from Bitcoin?]

After seven lessons examined through the lens of philosophy, let’s use the lens of economics to look at seven more. Economy class is all I can offer this time. Final destination: *sound money*.

== Lesson 8 - Financial ignorance
:figure-caption!:

[quote]
____
And what an ignorant little girl she'll think me for asking! No, it'll never do to ask: perhaps I shall see it written up somewhere.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-08.m4a[Audio. Read by Guy Swan]

One of the most surprising things, to me, was the amount of finance, economics, and psychology required to get a grasp of what at first glance seems to be a purely _technical_ system  —  a computer network. To paraphrase a little guy with hairy feet: “It’s a dangerous business, Frodo, stepping into Bitcoin. You read the whitepaper, and if you don’t keep your feet, there’s no knowing where you might be swept off to.” To understand a new monetary system, you have to get acquainted with the old one. I began to realize very soon that the amount of financial education I enjoyed in the educational system was essentially _zero_. Like a five-year-old, I began to ask myself a lot of questions: How does the banking system work? How does the stock market work? What is fiat money? What is _regular_ money? Why is there http://www.usdebtclock.org/[so much debt]? How much money is actually printed, and who decides that? After a mild panic about the sheer scope of my ignorance, I found reassurance in realizing that I was in good company.

[quote, aarontaycc]
“Isn’t it ironic that Bitcoin has taught me more about money than all these years I’ve spent working for financial institutions? …including starting my career at a central bank”

[quote, bitcoindunny]
“I’ve learned more about finance, economics, technology, cryptography, human psychology, politics, game theory, legislation, and myself in the last three months of crypto than the last three and a half years of college”

These are just two of the https://twitter.com/search?q=bitcoin%20AND%20I%20AND%20%28learned%20OR%20taught%29&src=typd[many confessions] all over twitter. Bitcoin, as was explored in Lesson 1, is a living thing. Mises argued that economics also is a living thing. And as we all know from personal experience, living things are inherently difficult to understand.

[quote, Ludwig von Mises]
“A scientific system is but one station in an endlessly progressing search for knowledge. It is necessarily affected by the insufficiency inherent in every human effort. But to acknowledge these facts does not mean that present-day economics is backward. It merely means that economics is a living thing  —  and to live implies both imperfection and change.”

We all read about various financial crises in the news, wonder about how these big bailouts work and are puzzled over the fact that no one ever seems to be held accountable for damages which are in the trillions. I am still puzzled, but at least I am starting to get a glimpse of what is going on in the world of finance. Some people even go as far as to attribute the general ignorance on these topics to systemic, willful ignorance. While history, physics, biology, math, and languages are all part of our education, the world of money and finance surprisingly is only explored superficially, if at all. I wonder if people would still be willing to accrue as much debt as they currently do if everyone would be educated in personal finance and the workings of money and debt. Then I wonder how many layers of aluminum make an effective tinfoil hat. Probably three.

[quote, Robert Kiyosaki]

“Those crashes, these bailouts, are not accidents. And neither is it an accident that there is no financial education in school. […] It’s premeditated. Just as prior to the Civil War it was illegal to educate a slave, we are not allowed to learn about money in school.”

Like in The Wizard of Oz, we are told to pay no attention to the man behind the curtain. Unlike in The Wizard of Oz, we now have https://external-preview.redd.it/8d03MWWOf2HIyKrT8ThBGO4WFv-u25JaYqhbEO9b1Sk.jpg?width=683&auto=webp&s=dc5922d84717c6a94527bafc0189fd4ca02a24bb[real wizardry]: a censorship-resistant, open, borderless network of value-transfer. There is no curtain, and the magic is https://github.com/bitcoin/bitcoin[visible to anyone]. Bitcoin taught me to look behind the curtain and face my financial ignorance.

'''

*Down the Rabbit Hole*

* https://youtu.be/abMQhaMdQu0[Why the Rich are Getting Richer] by Robert Kiyosaki
* 🎧 https://stephanlivera.com/episode/71[Stephan Livera - Intro to Bitcoin Austrian thought] SLP#71 hosted by Stephan Livera
* 📚 https://amzn.to/3cTv7YN[Economic Depressions - Their Cause and Cure] by Murray N. Rothbard
* 📚 https://amzn.to/33eXE6H[Human Action] by Ludwig von Mises

== Lesson 9 - Inflation
:figure-caption!:

[quote]
____
My dear, here we must run as fast as we can, just to stay in place. And if you wish to go anywhere you must run twice as fast as that.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-09.m4a[Audio. Read by Guy Swan]

Trying to understand monetary inflation, and how a non-inflationary system like Bitcoin might change how we do things, was the starting point of my venture into economics. I knew that inflation was the rate at which new money was created, but I didn’t know too much beyond that. While some economists argue that inflation is a good thing, others argue that “hard” money which can’t be inflated easily — as we had in the days of the gold standard  —  is essential for a healthy economy. Bitcoin, having a fixed supply of 21 million, agrees with the latter camp. Usually, the effects of inflation are not immediately obvious. Depending on the inflation rate (as well as other factors) the time between cause and effect can be several years. Not only that, but inflation affects different groups of people more than others. As Henry Hazlitt points out in _Economics in One Lesson_: “The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” One of my personal lightbulb moments was the realization that issuing new currency  —  printing more money  —  is a _completely_ different economic activity than all the other economic activities. While real goods and real services produce real value for real people, printing money effectively does the opposite: it takes away value from everyone who holds the currency which is being inflated.

[quote]
“Mere inflation  —  that is, the mere issuance of more money, with the consequence of higher wages and prices  —  may look like the creation of more demand. But in terms of the actual production and exchange of real things it is not.”

[quote]
https://mises.org/library/economics-one-lesson[Henry Hazlitt]

The destructive force of inflation becomes obvious as soon as a little inflation turns into _a lot_. If money https://en.wikipedia.org/wiki/Hyperinflation[hyperinflates], things get ugly real quick. As the inflating currency falls apart, it will fail to store value over time and people will rush to get their hands on any goods which might do. Another consequence of hyperinflation is that all the money which people have saved over the course of their life will effectively vanish. The paper money in your wallet will still be there, of course. But it will be exactly that: worthless paper.

image::https://21lessons.com/assets/images/children-playing-with-money.png[Hyperinflation in the Weimar Republic (1921-1923), 300, align="center"]

Money declines in value with so-called “mild” inflation as well. It just happens slowly enough that most people don’t notice the diminishing of their purchasing power. And once the printing presses are running, currency can be easily inflated, and what used to be mild inflation might turn into a strong cup of inflation by the push of a button. As Friedrich Hayek pointed out in one of his essays, mild inflation usually leads to outright inflation.

[quote]
"”Mild” steady inflation cannot help  —  it can lead only to outright inflation.”

[quote]
https://books.google.com/books?id=zZu3AAAAIAAJ&dq=%22only+while+it+accelerates%22&focus=searchwithinvolume&q=%22steady+inflation+cannot+help%22[Friedrich Hayek]

Inflation is particularly devious since it favors those who are closer to the printing presses. It takes time for the newly created money to circulate and prices to adjust, so if you are able to get your hands on more money before everyone else’s devaluates you are ahead of the inflationary curve. This is also why inflation can be seen as a hidden tax because in the end governments profit from it while everyone else ends up paying the price.

[quote, Friedrich Hayek]
“I do not think it is an exaggeration to say history is largely a history of inflation, and usually of inflations engineered by governments for the gain of governments.”

So far, all government-controlled currencies have eventually been replaced or have collapsed completely. No matter how small the rate of inflation, “steady” growth is just another way of saying exponential growth. In nature as in economics, all systems which grow exponentially will eventually have to level off or suffer from catastrophic collapse. “It can’t happen in my country,” is what you’re probably thinking. You don’t think that if you are from Venezuela, which is https://en.wikipedia.org/wiki/Crisis_in_Venezuela#Economic_crisis[currently suffering] from hyperinflation. With an inflation rate of over 1 million percent, money is basically worthless. It might not happen in the next couple of years, or to the particular currency used in your country. But a glance at the https://en.wikipedia.org/wiki/List_of_historical_currencies[list of historical currencies] shows that it will inevitably happen over a long enough period of time. I remember and used plenty of those listed: the Austrian schilling, the German mark, the Italian lira, the French franc, the Irish pound, the Croatian dinar, etc. My grandma even used the Austro-Hungarian Krone. As time moves on, the currencies https://en.wikipedia.org/wiki/List_of_currencies[currently in use] will slowly but surely move to their respective graveyards. They will hyperinflate or be replaced. They will soon be historical currencies. We will make them obsolete.

[quote, Saifedean Ammous]
“History has shown that governments will inevitably succumb to the temptation of inflating the money supply.”

Why is Bitcoin different? In contrast to currencies mandated by the government, monetary goods which are not regulated by governments, but https://dergigi.com/2018/06/10/bitcoin-s-energy-consumption/[by the laws of physics], tend to survive and even hold their respective value over time. The best example of this so far is gold, which, as the aptly-named https://www.businesswire.com/news/home/20110819005774/en/History-Shows-Price-Ounce-Gold-Equals-Price[_Gold-to-Decent-Suit Ratio_] shows, is holding its value over hundreds and even thousands of years. It might not be perfectly “stable”  —  a questionable concept in the first place  —  but the value it holds will at least be in the same order of magnitude. If a monetary good or currency holds its value well over time and space, it is considered to be _hard_. If it can’t hold its value, because it easily deteriorates or inflates, it is considered a _soft_ currency. The concept of hardness is essential to understand Bitcoin and is worthy of a more thorough examination. We will return to it in the last economic lesson: sound money. As more and more countries suffer from https://en.wikipedia.org/wiki/Hyperinflation[hyperinflation], more and more people will have to face the reality of hard and soft money. If we are lucky, maybe even some central bankers will be forced to re-evaluate their monetary policies. Whatever might happen, the insights I have gained thanks to Bitcoin will probably be invaluable, no matter the outcome. Bitcoin taught me about the hidden tax of inflation and the catastrophe of hyperinflation.
 

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2019/11/21/bitcoin-boots-on-the-ground-venezuela/[🔍 Bitcoin Boots on the Ground - Venezuela]

*Down the Rabbit Hole*

* https://en.wikipedia.org/wiki/2013%E2%80%93present_economic_crisis_in_Venezuela[Economic Crisis in Venezuela] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Hyperinflation[Hyperinflation] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/List_of_currencies[List of Currencies] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/List_of_historical_currencies[List of Historical Currencies] by Wikipedia Contributors
* https://trader2trader.wordpress.com/2012/11/28/list-of-590-dead-currencies-demonetized-r-i-p/[List of Dead Fiat Currencies] by Trader to Trader
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/157-Ben-Prentice--Heavily-Armed-Clown-edlfjb[Ben Prentice & Heavily Armed Clown on WTF Happened in 1971?] TFTC#157 hosted by Marty Bent
* 🎧 https://swansignalpodcast.com/episodes/saifedean-ammous-and-george-gammon-e23[Saifedean Ammous & George Gammon on Inflation, Deflation, and The Bitcoin Standard] SSL#23 hosted by Brady Swenson
* 📚 https://amzn.to/3aNWgui[1980S Unemployment And The Unions - Essays on the Impotent Price Structure of Britain and Monopoly in the Labour Market] by Friedrich von Hayek
* 📚 https://amzn.to/3aK2AD0[Economics In One Lesson] by Henry Hazlitt
* 📚 https://amzn.to/3pQF6Fo[Fiat Money Inflation In France - How It Came, What It Brought, and How It Ended] by Andrew Dickson White
* 📚 https://amzn.to/2IDF52u[Good Money, Part 2 - The Standard] by Friedrich von Hayek
* 📚 https://amzn.to/3EOBA4G[Hard-Boiled Egg Index - Surviving Zimbabwe’s Hyperinflation] by Kudzai Joseph Gumunyu
* 📚 https://amzn.to/3zlvoP4[When Money Dies - The Nightmare of Deficit Spending, Devaluation, and Hyperinflation in Weimar, Germany] by Adam Fergusson

== Lesson 10 - Value
:figure-caption!:

[quote]
____
It was the white rabbit, trotting slowly back again, and looking anxiously about it as it went, as if it had lost something...
____

audio::https://21lessons.com/assets/audio/21lessons/2-10.m4a[Audio. Read by Guy Swan]

Value is somewhat paradoxical, and there are https://en.wikipedia.org/wiki/Theory_of_value_%28economics%29[multiple theories] which try to explain why we value certain things over other things. People have been aware of this paradox for thousands of years. As Plato wrote in his dialogue with Euthydemus, we value some things because they are rare, and not merely based on their necessity for our survival.

[quote, Plato]
“And if you are prudent you will give this same counsel to your pupils also  —  that they are never to converse with anybody except you and each other. For it is the rare, Euthydemus, that is precious, while water is cheapest, though best, as Pindar said.”

This https://en.wikipedia.org/wiki/Paradox_of_value[paradox of value] shows something interesting about us humans: we seem to value things on a https://en.wikipedia.org/wiki/Subjective_theory_of_value[subjective] basis, but do so with certain non-arbitrary criteria. Something might be _precious_ to us for a variety of reasons, but things we value do share certain characteristics. If we can copy something very easily, or if it is naturally abundant, we do not value it. It seems that we value something because it is scarce (gold, diamonds, time), difficult or labor-intensive to produce, can’t be replaced (an old photograph of a loved one), is useful in a way in which it enables us to do things which we otherwise couldn’t, or a combination of those, such as great works of art. Bitcoin is all of the above: it is extremely rare (21 million), increasingly hard to produce (reward halvening), can’t be replaced (a lost private key is lost forever), and enables us to do some quite useful things. It is arguably the best tool for value transfer across borders, virtually resistant to censorship and confiscation in the process, plus, it is a self-sovereign store of value, allowing individuals to store their wealth independent of banks and governments, just to name two. Bitcoin taught me that value is subjective but not arbitrary.

*Down the Rabbit Hole*

* https://medium.com/coinmonks/bitcoin-has-no-intrinsic-value-and-thats-great-e6994adbfe0f[Bitcoin Has No Intrinsic Value — and That’s Great] by Conner Brown
* https://www.unchained-capital.com/blog/bitcoin-is-not-too-volatile/[Bitcoin Is Not Too Volatile] by Parker Lewis
* https://unchained-capital.com/blog/bitcoin-is-not-backed-by-nothing/[Bitcoin Is Not Backed By Nothing] by Parker Lewis
* http://www.perseus.tufts.edu/hopper/text?doc=Perseus:text:1999.01.0178:text=Euthyd.[Euthydemus] by Plato
* https://en.wikipedia.org/wiki/Paradox_of_value[Paradox of Value] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Subjective_theory_of_value[Subjective Theory of Value] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Theory_of_value_%28economics%29[Theory of Value] by Wikipedia Contributors
* 📚 https://amzn.to/2TTYBNi[Skin In The Game - Hidden Asymmetries in Daily Life] by Nassim Nicholas Taleb

== Lesson 11 - Money
:figure-caption!:

[quote]
____
"In my youth," said the sage, as he shook his gray locks, "I kept all my limbs very supple, By the use of this ointment, five shillings the box— Allow me to sell you a couple." 
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-11.m4a[Audio. Read by Guy Swan]

What is money? We use it every day, yet this question is surprisingly difficult to answer. We are dependent on it in ways big and small, and if we have too little of it our lives become very difficult. Yet, we seldom think about the thing which supposedly makes the world go round. Bitcoin forced me to answer this question over and over again: What the hell is money? In our “modern” world, most people will probably think of pieces of paper when they talk about money, even though most of our money is just a number in a bank account. We are already using zeros and ones as our money, so how is Bitcoin different? Bitcoin is different because at its core it is a very different _type_ of money than the money we currently use. To understand this, we will have to take a closer look at what money is, how it came to be, and why gold and silver was used for most of commercial history.

[quote, Satoshi Nakamoto]
“In this sense, it’s more typical of a precious metal. Instead of the supply changing to keep the value the same, the supply is predetermined and the value changes.”

Seashells, gold, silver, paper, bitcoin. In the end, *money is whatever people use as money*, no matter its shape and form, or lack thereof. Money, as an invention, is ingenious. A world without money is insanely complicated: How many fish will buy me new shoes? How many cows will buy me a house? What if I don’t need anything right now but I need to get rid of my soon-to-be rotten apples? You don’t need a lot of imagination to realize that a barter economy is maddeningly inefficient. The great thing about money is that it can be exchanged for _anything else_  —  that’s quite the invention! As http://unenumerated.blogspot.com/[Nick Szabo] brilliantly summarizes in _https://nakamotoinstitute.org/shelling-out/[Shelling Out: The Origins of Money]_, we humans have used all kinds of things as money: beads made of rare materials like ivory, shells, or special bones, various kinds of jewelry, and later on rare metals like silver and gold. Being the lazy creatures we are, we don’t think too much about things which just work. Money, for most of us, works just fine. Like with our cars or our computers, most of us are only forced to think about the inner workings of these things if they break down. People who saw their life-savings vanish because of hyperinflation know the value of hard money, just like people who saw their friends and family vanish because of the atrocities of Nazi Germany or Soviet Russia know the value of privacy. The thing about money is that it is all-encompassing. Money is half of every transaction, which imbues the ones who are in charge with creating money with enormous power.

[quote, Ron Paul]
“Given that money is one half of every commercial transaction and that whole civilizations literally rise and fall based on the quality of their money, we are talking about an awesome power, one that flies under the cover of night. It is the power to weave illusions that appear real as long as they last. That is the very core of the Fed’s power.”

Bitcoin peacefully removes this power, since it does away with money creation and it does so without the use of force. Money went through multiple iterations. Most iterations were good. They improved our money in one way or another. Very recently, however, the inner workings of our money got corrupted. Today, almost all of our money is simply created _out of thin air_ by the powers that be. To understand how this came to be I had to learn about the history and subsequent downfall of money. If it will take a series of catastrophes or simply a monumental educational effort to correct this corruption remains to be seen. I pray to the gods of sound money that it will be the latter. Bitcoin taught me what money is.

*Down the Rabbit Hole*

* https://nakamotoinstitute.org/shelling-out/[Shelling Out - The Origins of Money] by Nick Szabo
* http://unenumerated.blogspot.com/2017/02/money-blockchains-and-social-scalability.html[Money, blockchains, and social scalability] by Nick Szabo
* https://medium.com/@vijayboyapati/the-bullish-case-for-bitcoin-6ecc8bdecc1[The Bullish Case for Bitcoin] by Vijay Boyapati
* https://www.unchained-capital.com/blog/dollar-crisis-to-bitcoin/[Gradually, Then Suddenly] by Parker Lewis
* https://medium.com/@breedlove22/masters-and-slaves-of-money-255ecc93404f[Masters and Slaves of Money] by Robert Breedlove
* 🎧 https://www.theinvestorspodcast.com/episodes/tip244-bitcoin-101-tuur-demeester/[Tuur Demeester - Bitcoin 101] TIP#244 hosted by Preston Pysh and Stig Brodersen
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-87-Conner-Brown-e4n9pg[Conner Brown on the intersubjective nature of Bitcoin] TFTC#87 hosted by Marty Bent
* 🎧 https://www.whatbitcoindid.com/podcast/the-beginners-guide-to-bitcoin-part-2-what-is-money-with-parker-lewis[Parker Lewis - What is Money?] WBD#183 hosted by Peter McCormack
* 📚 https://amzn.to/31huozJ[Argentarius - Letters of a Bankdirektor to his Son] by Alfred Lansburgh
* 📚 https://amzn.to/39K1dnK[End The Fed] by Ron Paul
* 📚 https://amzn.to/38PySLn[What Has Government Done To Our Money] by Murray Rothbard

== Lesson 12 - The history and downfall of money
:figure-caption!:

[quote]
____
They would not remember the simple rules their friends had given them, such as, that, if you get into the fire, it will burn you, and that, if you cut your finger very deeply with a knife, it generally bleeds, and she had never forgotten that, if you drink a bottle marked "poison," it is almost certain to disagree with you, sooner or later.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-12.m4a[Audio. Read by Guy Swan]

Many people think that money is backed by gold, which is locked away in big vaults, protected by thick walls. This ceased to be true many decades ago. I am not sure what I thought, since I was in much deeper trouble, having virtually no understanding of gold, paper money, or why it would need to be backed by something in the first place. One part of learning about Bitcoin is learning about fiat money: what it means, how it came to be, and why it might not be the best idea we ever had. So, what exactly is fiat money? And how did we end up using it? If something is imposed by _fiat_, it simply means that it is imposed by formal authorization or proposition. Thus, fiat money is money simply because _someone_ says that it is money. Since all governments use fiat currency today, this someone is _your_ government. Unfortunately, you are not _free_ to disagree with this value proposition. You will quickly feel that this proposition is everything but non-violent. If you refuse to use this paper currency to do business and pay taxes the only people you will be able to discuss economics with will be your cellmates. The value of fiat money does not stem from its inherent properties. How good a certain type of fiat money is, is only correlated to the political and fiscal (in)stability of those who dream it into existence. Its value is imposed by decree, arbitrarily.

.fi·at /ˈfēˌät,ˈfēət/ --- 'Let it be done'
image::https://21lessons.com/assets/images/fiat-definition.png[fi·at /ˈfēˌät,ˈfēət/ --- 'Let it be done', 300, align="center"]

Until recently, two types of money were used: *commodity money*, made out of precious _things_, and *representative money*, which simply _represents_ the precious thing, mostly in writing. We already touched on commodity money above. People used special bones, seashells, and precious metals as money. Later on, mainly coins made out of precious metals like gold and silver were used as money. The https://en.wikipedia.org/wiki/History_of_coins[oldest coin] found so far is made of a natural gold-and-silver mix and was made more than 2700 years ago. If something is new in Bitcoin, the concept of a coin is not it.

image::https://21lessons.com/assets/images/lydian-coin-stater.png[Lydian electrum coin. Picture cc-by-sa Classical Numismatic Group, Inc., 300, align="center"]

Turns out that hoarding coins, or hodling, to use today’s parlance, is almost as old as coins. The earliest coin hodler was someone who put almost a hundred of these coins in a pot and buried it in the foundations of a temple, only to be found 2500 years later. Pretty good cold storage if you ask me. One of the downsides of using precious metal coins is that they can be clipped, effectively debasing the value of the coin. New coins can be minted from the clippings, inflating the money supply over time, devaluing every individual coin in the process. People were literally shaving off as much as they could get away with of their silver dollars. I wonder what kind of _Dollar Shave Club_ advertisements they had back in the day. Since governments are only cool with inflation if they are the ones doing it, efforts were made to stop this guerrilla debasement. In classic cops-and-robbers fashion, coin clippers got ever more creative with their techniques, forcing the ‘masters of the mint’ to get even more creative with their countermeasures. Isaac Newton, the world-renowned physicist of _Principia Mathematica_ fame, used to be one of these masters. He is attributed with adding the small stripes at the side of coins which are still present today. Gone were the days of easy coin shaving.

.Coin debasement
image::https://21lessons.com/assets/images/clipped-coins.png[Coin debasement, 300, align="center"]

Even with these methods of https://en.wikipedia.org/wiki/Methods_of_coin_debasement[coin debasement] kept in check, coins still suffer from other issues. They are bulky and not very convenient to transport, especially when large transfers of value need to happen. Showing up with a huge bag of silver dollars every time you want to buy a Mercedes isn’t very practical. Speaking of German things: How the United States _dollar_ got its name is another interesting story. The word “dollar” is derived from the German word _https://en.wikipedia.org/wiki/Thaler[Thaler]_, short for a _Joachimsthaler._ A Joachimsthaler was a coin minted in the town of _Sankt Joachimsthal_. Thaler is simply a shorthand for someone (or something) coming from the valley, and because Joachimsthal was _the_ valley for silver coin production, people simply referred to these silver coins as _Thaler._ Thaler (German) morphed into daalders (Dutch), and finally dollars (English).

.The original 'dollar'. Saint Joachim is pictured with his robe and wizard hat. Picture cc-by-sa Berlin-George
image::https://21lessons.com/assets/images/joachimsthaler.png[The original 'dollar'. Saint Joachim is pictured with his robe and wizard hat. Picture cc-by-sa Berlin-George, 300, align="center"]

The introduction of representative money heralded the downfall of hard money. Gold certificates were introduced in 1863, and about fifteen years later, the silver dollar was also slowly but surely being replaced by a paper proxy: the silver certificate. It took about 50 years from the introduction of the first https://en.wikipedia.org/wiki/Silver_certificate_%28United_States%29[silver certificates] until these pieces of paper morphed into something that we would today recognize as one U.S. dollar.

.A 1928 U.S. silver dollar. 'Payable to the bearer on demand.' Picture credit to the National Numismatic Collection at the Smithsonian Institution
image::https://21lessons.com/assets/images/us-silver-dollar-note-smaller.png[A 1928 U.S. silver dollar. 'Payable to the bearer on demand.' Picture credit to the National Numismatic Collection at the Smithsonian Institution, 300, align="center"]

Note that the 1928 U.S. silver dollar above still goes by the name of _silver certificate_, indicating that this is indeed simply a document stating that the bearer of this piece of paper is owed a piece of silver. It is interesting to see that the text which indicates this got smaller over time. The trace of “certificate” vanished completely after a while, being replaced by the reassuring statement that these are federal reserve notes. As mentioned above, the same thing happened to gold. Most of the world was on a https://en.wikipedia.org/wiki/Bimetallism[bimetallic standard], meaning coins were made primarily of gold and silver. Having certificates for gold, redeemable in gold coins, was arguably a technological improvement. Paper is more convenient, lighter, and since it can be divided arbitrarily by simply printing a smaller number on it, it is easier to break into smaller units. To remind the bearers (users) that these certificates were representative for actual gold and silver, they were colored accordingly and stated this clearly on the certificate itself. You can fluently read the writing from top to bottom:

[quote]
“This certifies that there have been deposited in the treasury of the United States of America one hundred dollars in gold coin payable to the bearer on demand.”

.Picture credit to National Numismatic Collection, National Museum of American History.
image::https://21lessons.com/assets/images/us-gold-cert-100-smaller.png[Picture credit to National Numismatic Collection, National Museum of American History., 300, align="center"]

In 1963, the words “PAYABLE TO THE BEARER ON DEMAND” were removed from all newly issued notes. Five years later, the redemption of paper notes for gold and silver ended. The words hinting on the origins and the idea behind paper money were removed. The golden color disappeared. All that was left was the paper and with it the ability of the government to print as much of it as it wishes. With the abolishment of the gold standard in 1971, this century-long sleight-of-hand was complete. Money became the illusion we all share to this day: fiat money. It is worth something because someone commanding an army and operating jails says it is worth something. As can be clearly read on every dollar note in circulation today, “THIS NOTE IS LEGAL TENDER”. In other words: It is valuable because the note says so.

.A 2004 series U.S. twenty dollar note used today. 'THIS NOTE IS LEGAL TENDER'
image::https://21lessons.com/assets/images/us-dollar-2004.jpg[A 2004 series U.S. twenty dollar note used today. 'THIS NOTE IS LEGAL TENDER', 300, align="center"]

By the way, there is another interesting lesson on today’s bank notes, hidden in plain sight. The second line reads that this is legal tender “FOR ALL DEBTS, PUBLIC AND PRIVATE”. What might be obvious to economists was surprising to me: All money is debt. My head is still hurting because of it, and I will leave the exploration of the relation of money and debt as an exercise to the reader. As we have seen, gold and silver were used as money for millennia. Over time, coins made from gold and silver were replaced by paper. Paper slowly became accepted as payment. This acceptance created an illusion  —  the illusion that the paper itself has value. The final move was to completely sever the link between the representation and the actual: abolishing the gold standard and convincing everyone that the paper in itself is precious. Bitcoin taught me about the history of money and the greatest sleight of hand in the history of economics: fiat currency.

*Down the Rabbit Hole*

* https://unchained-capital.com/blog/enders-game/[Enders Game] by Parker Lewis
* https://unchained-capital.com/blog/bitcoin-fixes-this/[Bitcoin Fixes This] by Parker Lewis
* https://unchained-capital.com/blog/bitcoin-obsoletes-all-other-money/[Bitcoin Obsoletes All Other Money] by Parker Lewis
* https://unchained-capital.com/blog/bitcoin-is-a-rally-cry/[Bitcoin Is a Rally Cry] by Parker Lewis
* https://en.wikipedia.org/wiki/Bimetallism[Bimetallism] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Methods_of_coin_debasement[Methods of Coin Debasement] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Thaler[Thaler] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Silver_certificate_%28United_States%29[U.S. Silver Certificate] by Wikipedia Contributors
* 📚 https://amzn.to/2xqiEeL[How Is Fiat Money Possible] by Hans-Hermann Hoppe
* 📚 https://amzn.to/2Qauu3s[On The Origins Of Money] by Carl Menger

== Lesson 13 - Fractional Reserve Insanity
:figure-caption!:

[quote]
____
Alas! it was too late: she went on growing and growing, and very soon had to kneel down: in another minute there was not room even for this, and she tried the effect of lying down, with one elbow against the door, and the other arm curled round her head. Still she went on growing, and as a last resource she put one arm out of the window, and one foot up the chimney, and said to herself "now I can do no more—what will become of me?"
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-13.m4a[Audio. Read by Guy Swan]

Value and money aren’t trivial topics, especially in today’s times. The process of money creation in our banking system is equally non-trivial, and I can’t shake the feeling that this is deliberately so. What I have previously only encountered in academia and legal texts seems to be common practice in the financial world as well: nothing is explained in simple terms, not because it is truly complex, but because the truth is hidden behind layers and layers of jargon and _apparent_ complexity. “Expansionary monetary policy, quantitative easing, fiscal stimulus to the economy.” The audience nods along in agreement, hypnotized by the fancy words. Fractional reserve banking and quantitative easing are two of those fancy words, obfuscating what is really happening by masking it as complex and difficult to understand. If you would explain them to a five-year-old, the insanity of both will become apparent quickly. Godfrey Bloom, addressing the European Parliament during a https://www.youtube.com/watch?v=hYzX3YZoMrs[joint debate], said it way better than I ever could:

[quote]
“[…] you do not really understand the concept of banking. All the banks are broke. Bank Santander, Deutsche Bank, Royal Bank of Scotland  —  they’re all broke! And why are they broke? It isn’t an act of God. It isn’t some sort of tsunami. They’re broke because we have a system called ‘fractional reserve banking’ which means that banks can lend money that they don’t actually have! It’s a criminal scandal and it’s been going on for too long. […] We have counterfeiting  —  sometimes called quantitative easing  —  but counterfeiting by any other name. The artificial printing of money which, if any ordinary person did, they’d go to prison for a very long time […] and until we start sending bankers  —  and I include central bankers and politicians  —  to prison for this outrage it will continue.”

[quote]
https://www.youtube.com/watch?v=hYzX3YZoMrs[Godfrey Bloom]

Let me repeat the most important part: banks can lend money that they don’t actually have. Thanks to fractional reserve banking, a bank only has to keep a small _fraction_ of every dollar it gets. It’s somewhere between 0 and 10%, usually at the lower end, which makes things even worse. Let’s use a concrete example to better understand this crazy idea: A fraction of 10% will do the trick and we should be able to do all the calculations in our head. Win-win. So, if you take $100 to a bank  —  because you don’t want to store it under your mattress  —  they only have to keep the agreed upon _fraction_ of it. In our example that would be $10, because 10% of $100 is $10. Easy, right? So what do banks do with the rest of the money? What happens to your $90? They do what banks do, they lend it to other people. The result is a https://en.wikipedia.org/wiki/Money_multiplier[money multiplier] effect, which increases the money supply in the economy enormously. Your initial deposit of $100 will soon turn into $190. By lending a 90% fraction of the newly created $90, there will soon be $271 in the economy. And $343.90 after that. The money supply is recursively increasing, since banks are literally lending money they don’t have. Without a single Abracadabra, banks magically transform $100 into one thousand dollars or more. Turns out 10x is easy. It only takes a couple of lending rounds.

.Money multiplier
image::https://21lessons.com/assets/images//money-multiplier.png[Money multiplier, 300, align="center"]

Don’t get me wrong: There is nothing wrong with lending. There is nothing wrong with interest. There isn’t even anything wrong with good old regular banks to store your wealth somewhere more secure than in your sock drawer. Central banks, however, are a different beast. Abominations of financial regulation, half public half private, playing god with something which affects everyone who is part of our global civilization, without a conscience, only interested in the immediate future, and seemingly without any accountability or https://i.imgur.com/O03TBuP.jpg[auditability]. While Bitcoin is still inflationary, it will cease to be so rather soon. The strictly limited supply of 21 million bitcoins will eventually do away with inflation completely. We now have two monetary worlds: an inflationary one where money is printed arbitrarily, and the world of Bitcoin, where final supply is fixed and easily auditable for everyone. One is forced upon us by violence, the other can be joined by anyone who wishes to do so. No barriers to entry, no one to ask for permission. Voluntary participation. That is the beauty of Bitcoin. I would argue that the argument between https://en.wikipedia.org/wiki/Keynesian_economics[Keynesian] and https://en.wikipedia.org/wiki/Austrian_School[Austrian] economists is no longer purely academical. Satoshi managed to build a system for value transfer on steroids, creating the soundest money which ever existed in the process. One way or another, more and more people will learn about the scam which is fractional reserve banking. If they come to similar conclusions as most Austrians and Bitcoiners, they might join the ever-growing internet of money. Nobody can stop them if they choose to do so. Bitcoin taught me that fractional reserve banking is pure insanity.

*Down the Rabbit Hole*

* https://en.wikipedia.org/wiki/Austrian_School[Austrian School] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Keynesian_economics[Keynesian Economics] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Money_multiplier[Money Multiplier] by Wikipedia Contributors
* https://www.youtube.com/watch?v=hYzX3YZoMrs[Why the whole banking system is a scam] by Godfrey Bloom
* 🎧 https://stephanlivera.com/episode/51[Jörg Guido Hülsmann on Fiat Money and Fractional Reserve Banking] SLP#51 hosted by Stephan Livera
* 📚 https://amzn.to/2U1w8VZ[The Creature From Jekyll Island] by G. Edward Griffin

== Lesson 14 - Sound money
:figure-caption!:

[quote]
____
"The first thing I've got to do," said Alice to herself, as she wandered about in the wood, "is to grow to my right size, and the second thing is to find my way into that lovely garden. I think that will be the best plan."
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/2-14.m4a[Audio. Read by Guy Swan]

The most important lesson I have learned from Bitcoin is that in the long run, hard money is superior to soft money. Hard money, also referred to as _sound money_, is any globally traded currency that serves as a reliable store of value. Granted, Bitcoin is still young and volatile. Critics will say that it does not store value reliably. The volatility argument is missing the point. Volatility is to be expected. The market will take a while to figure out the just price of this new money. Also, as is often jokingly pointed out, it is grounded in an error of measurement. If you think in dollars you will fail to see that one bitcoin will always be worth one bitcoin.

[quote, Fr. Bernard W. Dempsey, S.J.]
“A fixed money supply, or a supply altered only in accord with objective and calculable criteria, is a necessary condition to a meaningful just price of money.”

As a quick stroll through the graveyard of forgotten currencies has shown, money which can be printed will be printed. So far, no human in history was able to resist this temptation. Bitcoin does away with the temptation to print money in an ingenious way. Satoshi was aware of our greed and fallibility  —  this is why he chose something more reliable than human restraint: mathematics.

image::https://21lessons.com/assets/images/supply-formula-white.png[Bitcoin's supply formula, 300, align="center"]

While this formula is useful to describe Bitcoin’s supply, it is actually nowhere to be found in the code. Issuance of new bitcoin is done in an https://en.bitcoin.it/wiki/Controlled_supply[algorithmically controlled] fashion, by reducing the reward which is paid to miners every four years. The formula above is used to quickly sum up what is happening under the hood. What really happens can be best seen by looking at the change in block reward, the reward paid out to whoever finds a valid block, which roughly happens every 10 minutes.

.You are here.
image::https://21lessons.com/assets/images/you-are-here.png[You are here., 300, align="center"]

Formulas, logarithmic functions and exponentials are not exactly intuitive to understand. The concept of _soundness_ might be easier to understand if looked at in another way. Once we know how much there is of something, and once we know how hard this something is to produce or get our hands on, we immediately understand its value. What is true for Picasso’s paintings, Elvis Presley’s guitars, and Stradivarius violins is also true for fiat currency, gold, and bitcoins. The hardness of fiat currency depends on who is in charge of the respective printing presses. Some governments might be more willing to print large amounts of currency than others, resulting in a weaker currency. Other governments might be more restrictive in their money printing, resulting in harder currency. Before we had fiat currencies, the soundness of money was determined by the natural properties of the stuff which we used as money. The amount of gold on earth is limited by the laws of physics. Gold is rare because supernovae and neutron star collisions are rare. The “flow” of gold is limited because extracting it is quite an effort. Being a heavy element it is mostly buried deep underground. The abolishment of the gold standard gave way to a new reality: adding new money requires just a drop of ink. In our modern world adding a couple of zeros to the balance of a bank account requires even less effort: flipping a few bits in a bank computer is enough.

[quote, Jörg Guido Hülsmann]
“One important aspect of this new reality is that institutions like the Fed cannot go bankrupt. They can print any amount of money that they might need for themselves at virtually zero cost.”

The principle outlined above can be expressed more generally as the ratio of “stock” to “flow”. Simply put, the _stock_ is how much of something is currently there. For our purposes, the stock is a measure of the current money supply. The _flow_ is how much there is produced over a period of time (e.g. per year). The key to understanding sound money is in understanding this stock-to-flow ratio. Calculating the stock-to-flow ratio for fiat currency is difficult, because https://en.wikipedia.org/wiki/Money_supply[how much money there is] depends on how you look at it. You could count only banknotes and coins (M0), add traveler checks and check deposits (M1), add saving accounts and mutual funds and some other things (M2), and even add certificates of deposit to all of that (M3). Further, how all of this is defined and measured varies from country to country and since the US Federal Reserve https://www.federalreserve.gov/Releases/h6/discm3.htm[stopped publishing] numbers for M3, we will have to make do with the M2 monetary supply. I would love to verify these numbers, but I guess we have to trust the fed for now. Gold, one of the rarest metals on earth, has the highest stock-to-flow ratio. According to the US Geological Survey, a little more than 190,000 tons have been mined. In the https://minerals.usgs.gov/minerals/pubs/mcs/2018/mcs2018.pdf[last few years], around 3100 tons of gold have been mined per year. Using these numbers, we can easily calculate the stock-to-flow ratio for gold: 190,000 tons / 3,100 tons = ~61. Nothing has a higher stock-to-flow ratio than gold. This is why gold, up to now, was the hardest, soundest money in existence. It is often said that all the gold mined so far would fit in two olympic-sized swimming pools. According to https://www.wolframalpha.com/input/?i=volume+of+190000+metric+tons+gold+%2F+olympic+swimming+pool+volume[my calculations], we would need four. So maybe this needs updating, or Olympic-sized swimming pools got smaller. Enter Bitcoin. As you probably know, bitcoin mining was all the rage in the last couple of years. This is because we are still in the early phases of what is called the _reward era_, where mining nodes are rewarded with _a lot_ of bitcoin for their computational effort. We are currently in reward era number 4, which began in 2020 and will end in early 2024, probably in May. While the bitcoin supply is predetermined, the inner workings of Bitcoin only allow for approximate dates. Nevertheless, we can predict with certainty how high Bitcoin’s stock-to-flow ratio will be. Spoiler alert: it will be high. How high? Well, it turns out that Bitcoin will get infinitely hard.

image::https://21lessons.com/assets/images/stock-to-flow-white-cc-by-sources.png[Visualization of stock and flow for USD, gold, and Bitcoin, 300, align="center"]

Due to an exponential decrease of the mining reward, the flow of new bitcoin will diminish resulting in a sky-rocketing stock-to-flow ratio. It almost caught up to gold in 2020, only to surpass it four years later by doubling its soundness again. Such a doubling will occur 32 times in total. Thanks to the power of exponentials, the number of bitcoin mined per year will drop below 100 bitcoin in 50 years and below 1 bitcoin in 75 years. The global faucet which is the block reward will dry up somewhere around the year 2140, effectively stopping the production of bitcoin. This is a long game. If you are reading this, you are still early.

image::https://21lessons.com/assets/images/soundness-over-time.png[Rising stock-to-flow ratio of bitcoin as compared to gold, 300, align="center"]

As bitcoin approaches infinite stock to flow ratio it will be the soundest money in existence. Infinite soundness is hard to beat. Viewed through the lens of economics, Bitcoin’s _difficulty adjustment_ is probably its most important component. How hard it is to mine bitcoin depends on how quickly new bitcoins are mined*. It is the dynamic adjustment of the network’s mining difficulty which enables us to predict its future supply. _(* It actually depends on how quickly valid blocks are found, but for our purposes, this is the same thing as “mining bitcoins” and will be so for the next 120 years.)_ The simplicity of the difficulty adjustment algorithm might distract from its profundity, but the difficulty adjustment truly is a revolution of Einsteinian proportions. It ensures that, no matter how much or how little effort is spent on mining, Bitcoin’s controlled supply won’t be disrupted. As opposed to every other resource, no matter how https://dergigi.com/2018/06/10/bitcoin-s-energy-consumption/[much energy] someone will put into mining bitcoin, the total reward will not increase. Just like E=mc² dictates the https://en.wikipedia.org/wiki/Speed_of_light#Upper_limit_on_speeds[universal speed limit] in our universe, Bitcoin’s difficulty adjustment dictates the *universal money limit* in Bitcoin. If it weren’t for this difficulty adjustment, all bitcoins would have been mined already. If it weren’t for this difficulty adjustment, Bitcoin probably wouldn’t have survived in its infancy. It is what secures the network in its reward era. It is what ensures a steady and https://blog.picks.co/bitcoins-distribution-was-fair-e2ef7bbbc892[fair distribution] of new bitcoin. It is the thermostat which regulates Bitcoin’s monetary policy. Einstein showed us something novel: no matter how hard you push an object, at a certain point you won’t be able to get more speed out of it. Satoshi also showed us something novel: no matter how hard you dig for this digital gold, at a certain point you won’t be able to get more bitcoin out of it. For the first time in human history, we have a monetary good which, no matter how hard you try, you won’t be able to produce more of. Bitcoin taught me that sound money is essential.

*Down the Rabbit Hole*

* https://blog.picks.co/bitcoins-distribution-was-fair-e2ef7bbbc892[Bitcoin’s distribution was fair] by Dan Held
* https://unchained-capital.com/blog/bitcoin-is-common-sense/[Bitcoin is Common Sense] by Parker Lewis
* https://en.bitcoin.it/wiki/Controlled_supply[Bitcoin’s Controlled Supply] by Bitcoin Wiki Contributors
* https://www.usgs.gov/centers/nmic/mineral-commodity-summaries[Mineral Commodity Summaries 2019] by the United States Geological Survey
* https://en.wikipedia.org/wiki/Money_supply[Money Supply] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Speed_of_light#Upper_limit_on_speeds[Speed of Light] by Wikipedia Contributors
* 🎧 https://noded.org/podcast/noded-030-with-saifedean-ammous/[Saifedean Ammous on Bitcoin as Sound Money] Noded#3 hosted by Michael Goldstein and Pierre Rochard
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-34-Murad-Mahmudov-e1qndn[Murad Mahmudov on Bitcoin as the World Reserve Currency] TFTC#34 hosted by Marty Bent
* 📚 https://amzn.to/3aRdPK8[Money, Sound And Unsound] by Joseph Salerno
* 📚 https://amzn.to/39LVVZ3[The Ethics Of Money Production] by Jörg Guido Hülsmann

== Chapter III - Technology
:figure-caption!:

[quote]
___
"Now, I'll manage better this time" she said to herself, and began by taking the little golden key, and unlocking the door that led into the garden.
___

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-00.m4a[Audio. Read by Guy Swan]
 
Golden keys, clocks which only work by chance, races to solve strange riddles, and builders that don’t have faces or names. What sounds like fairy tales from Wonderland is daily business in the world of Bitcoin.

As we explored in https://21lessons.com/economics[Chapter 2], large parts of the current financial system are systematically broken. Like Alice, we can only hope to manage better this time. But, thanks to a pseudonymous inventor, we have incredibly sophisticated technology to support us this time around: Bitcoin.

Solving problems in a radically decentralized and adversarial environment requires unique solutions. What would otherwise be trivial problems to solve are everything but in this strange world of nodes. Bitcoin relies on strong cryptography for most solutions, at least if looked at through the lens of technology. Just how strong this cryptography is will be explored in one of the following lessons.

Cryptography is what Bitcoin uses to remove trust in authorities. Instead of relying on centralized institutions, the system relies on the final authority of our universe: physics. Some grains of trust still remain, however. We will examine these grains in the second lesson of this chapter.

* Lesson 15: Strength in numbers
* Lesson 16: Reflections on "Don't Trust, Verify"
* Lesson 17: Telling time takes work
* Lesson 18: Move slowly and don't break things
* Lesson 19: Privacy is not dead
* Lesson 20: Cypherpunks write code
* Lesson 21: Metaphors for Bitcoin's future

The last couple of lessons explore the ethos of technological development in Bitcoin, which is arguably as important as the technology itself. Bitcoin is not the next shiny app on your phone. It is the foundation of a new economic reality, which is why Bitcoin should be treated as nuclear-grade financial software.

Where are we in this financial, societal, and technological revolution? Networks and technologies of the past may serve as metaphors for Bitcoins future, which are explored in the last lesson of this chapter.

Once more, strap in and enjoy the ride. Like all exponential technologies, we are about to go parabolic.

== Lesson 15 - Strength in numbers
:figure-caption!:

[quote]
____
Let me see: four times five is twelve, and four times six is thirteen, and four times seven is fourteen—oh dear! I shall never get to twenty at this rate!
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-15.m4a[Audio. Read by Guy Swan]

Numbers are an essential part of our everyday life. Large numbers, however, aren’t something most of us are too familiar with. The largest numbers we might encounter in everyday life are in the range of millions, billions, or trillions. We might read about millions of people in poverty, billions of dollars spent on bank bailouts, and trillions of national debt. Even though it’s hard to make sense of these headlines, we are somewhat comfortable with the size of those numbers. Although we might seem comfortable with billions and trillions, our intuition already starts to fail with numbers of this magnitude. Do you have an intuition how long you would have to wait for a million/billion/trillion seconds to pass? If you are anything like me, you are lost without actually crunching the numbers. Let’s take a closer look at this example: the difference between each is an increase by three orders of magnitude: 10⁶, 10⁹, 10¹². Thinking about seconds is not very useful, so let’s translate this into something we can wrap our head around:

* 10⁶: One million seconds was 1½ weeks ago.
* 10⁹: One billion seconds was almost 32 years ago.
* 10¹²: One trillion seconds ago Manhattan was covered under a https://en.wikipedia.org/wiki/Last_Glacial_Maximum[thick layer of ice].

image::https://21lessons.com/assets/images/xkcd-1225.png[About 1 trillion seconds ago. Source: xkcd #1225, 300, align="center"]

As soon as we enter the beyond-astronomical realm of modern cryptography, our intuition fails catastrophically. Bitcoin is built around large numbers and the virtual impossibility of guessing them. These numbers are way, way larger than anything we might encounter in day-to-day life. Many orders of magnitude larger. Understanding how large these numbers truly are is essential to understanding Bitcoin as a whole. Let’s take https://en.wikipedia.org/wiki/SHA-2[SHA-256], one of the https://en.bitcoin.it/wiki/Block_hashing_algorithm[hash functions] used in Bitcoin, as a concrete example. It is only natural to think about 256 bits as “two hundred fifty-six,” which isn’t a large number at all. However, the number in SHA-256 is talking about orders of magnitude  —  something our brains are not well-equipped to deal with. While bit length is a convenient metric, the true meaning of 256-bit security is lost in translation. Similar to the millions (10⁶) and billions (10⁹) above, the number in SHA-256 is about orders of magnitude (2²⁵⁶). So, how strong is SHA-256, exactly?

[quote, Satoshi Nakamoto]
“SHA-256 is very strong. It’s not like the incremental step from MD5 to SHA1. It can last several decades unless there’s some massive breakthrough attack.”

Let’s spell things out. 2²⁵⁶ equals the following number:

----
115 quattuorvigintillion 792 trevigintillion 89 duovigintillion 237 unvigintillion 316 vigintillion 195 novemdecillion 423 octodecillion 570 septendecillion 985 sexdecillion 8 quindecillion 687 quattuordecillion 907 tredecillion 853 duodecillion 269 undecillion 984 decillion 665 nonillion 640 octillion 564 septillion 39 sextillion 457 quintillion 584 quadrillion 7 trillion 913 billion 129 million 639 thousand 936.
----

That’s a lot of nonillions! Wrapping your head around this number is pretty much impossible. There is nothing in the physical universe to compare it to. It is far larger than the number of atoms in the observable universe. The human brain simply isn’t made to make sense of it. One of the best visualizations of the true strength of SHA-256 is the following video by Grant Sanderson. Aptly named https://www.youtube.com/watch?v=S9JGmA5_unY[“How secure is 256 bit security?”] it beautifully shows how large a 256-bit space is. Do yourself a favor and take the five minutes to watch it. As all other https://twitter.com/3blue1brown[3Blue1Brown] videos it is not only fascinating but also exceptionally well made. Warning: You might fall down a math rabbit hole.

image::https://21lessons.com/assets/images/youtube-vid.png[Answer: Pretty secure., 300, align="center"]

https://www.schneier.com/[Bruce Schneier] used the physical limits of computation to put this number into perspective: even if we could build an optimal computer, which would use any provided energy to https://en.wikipedia.org/wiki/Landauer%27s_principle#Equation[flip bits perfectly], build a https://en.wikipedia.org/wiki/Dyson_sphere[Dyson sphere] around our sun, and let it run for 100 billion billion years, we would still only have a 25% chance to find a needle in a 256-bit haystack.

[quote, Bruce Schneier]
“These numbers have nothing to do with the technology of the devices; they are the maximums that thermodynamics will allow. And they strongly imply that brute-force attacks against 256-bit keys will be infeasible until computers are built from something other than matter and occupy something other than space.”

It is hard to overstate the profoundness of this. Strong cryptography inverts the power-balance of the physical world we are so used to. Unbreakable things do not exist in the real world. Apply enough force, and you will be able to open any door, box, or treasure chest. Bitcoin’s treasure chest is very different. It is secured by strong cryptography, which does not give way to brute force. And as long as the underlying mathematical assumptions hold, brute force is all we have. Granted, there is also the option of a global https://xkcd.com/538/[$5 wrench attack]. But torture won’t work for all Bitcoin addresses, and the cryptographic walls of Bitcoin will defeat brute force attacks. Even if you come at it with the force of a thousand suns. Literally. This fact and its implications were poignantly summarized in the https://cryptome.org/2012/12/assange-crypto-arms.htm[call to cryptographic arms]:
_“No amount of coercive force will ever solve a math problem.”_

[quote, Julian Assange]
“It isn’t obvious that the world had to work this way. But somehow the universe smiles on encryption.”

Nobody yet knows for sure if the universe’s smile is genuine or not. It is possible that our assumption of mathematical asymmetries is wrong and we find that https://en.wikipedia.org/wiki/P_versus_NP_problem#P_=_NP[P actually equals NP], or we find surprisingly quick solutions to https://en.wikipedia.org/wiki/Discrete_logarithm#Cryptography[specific problems] which we currently assume to be hard. If that should be the case, cryptography as we know it will cease to exist, and the implications would most likely change the world beyond recognition.

[quote, epii]
“Vires in Numeris” = “Strength in Numbers”

_Vires in numeris_ is not only a catchy motto used by bitcoiners. The realization that there is an unfathomable strength to be found in numbers is a profound one. Understanding this, and the inversion of existing power balances which it enables changed my view of the world and the future which lies ahead of us. One direct result of this is the fact that you don’t have to ask anyone for permission to participate in Bitcoin. There is no page to sign up, no company in charge, no government agency to send application forms to. Simply generate a large number and you are pretty much good to go. The central authority of account creation is mathematics. And God only knows who is in charge of that.

image::https://21lessons.com/assets/images/elliptic-curve-examples.png[Elliptic curve examples (cc-by-sa Emmanuel Boutet), 300, align="center"]

Bitcoin is built upon our best understanding of reality. While there are still many open problems in physics, computer science, and mathematics, we are pretty sure about some things. That there is an asymmetry between finding solutions and validating the correctness of these solutions is one such thing. That computation needs energy is another one. In other words: finding a needle in a haystack is harder than checking if the pointy thing in your hand is indeed a needle or not. And finding the needle takes work. The vastness of Bitcoin’s address space is truly mind-boggling. The number of private keys even more so. It is fascinating how much of our modern world boils down to the improbability of finding a needle in an unfathomably large haystack. I am now more aware of this fact than ever. Bitcoin taught me that there is strength in numbers.

*Down the Rabbit Hole*

* https://en.bitcoin.it/wiki/Block_hashing_algorithm[Block hashing algorithm] by Bitcoin Wiki Contributors
* https://en.wikipedia.org/wiki/Discrete_logarithm#Cryptography[Discrete Logarithm] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Dyson_sphere[Dyson Sphere] by Wikipedia Contributors
* https://www.youtube.com/watch?v=S9JGmA5_unY[How secure is 256 bit security?] by 3Blue1Brown
* https://en.wikipedia.org/wiki/Landauer%27s_principle#Equation[Landauer’s Principle] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Last_Glacial_Maximum[Last Glacial Maximum] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/P_versus_NP_problem#P_=_NP[P versus NP] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/SHA-2[SHA-2] by Wikipedia Contributors
* 📚 https://amzn.to/2w18QHT[Fooled By Randomness - The Hidden Role of Chance in Life and in the Markets] by Nassim Nicholas Taleb

== Lesson 16 - Reflections on "Don't Trust, Verify"
:figure-caption!:

[quote]
____
"Now for the evidence," said the King, "and then the sentence."
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-16.m4a[Audio. Read by Guy Swan]

Bitcoin aims to replace, or at least provide an alternative to, conventional currency. Conventional currency is bound to a centralized authority, no matter if we are talking about legal tender like the US dollar or modern monopoly money like Fortnite’s V-Bucks. In both examples, you are bound to trust the central authority to issue, manage and circulate your money. Bitcoin unties this bound, and the main issue Bitcoin solves is the issue of _trust_.

[quote, Satoshi]
“The root problem with conventional currency is all the trust that’s required to make it work. […] What is needed is an electronic payment system based on cryptographic proof instead of trust”

Bitcoin solves the problem of trust by being completely decentralized, with no central server or trusted parties. Not even trusted _third_ parties, but trusted parties, period. When there is no central authority, there simply _is_ no-one to trust. Complete decentralization is the innovation. It is the root of Bitcoin’s resilience, the reason why it is still alive. Decentralization is also why we have mining, nodes, hardware wallets, and yes, the blockchain. The only thing you have to “trust” is that our understanding of mathematics and physics isn’t totally off and that the https://bitcoin.org/en/developer-guide#term-51-attack[majority] of miners act honestly (which they are incentivized to do). While the regular world operates under the assumption of _“trust, but verify,”_ Bitcoin operates under the assumption of _“don’t trust, verify.”_ Satoshi made the importance of removing trust very clear in both the introduction as well as the conclusion of the https://bitcoin.org/bitcoin.pdf[Bitcoin whitepaper].

[quote, Satoshi Nakamoto]
“Conclusion: We have proposed a system for electronic transactions without relying on trust.”

Note that “without relying on trust” is used in a very specific context here. We are talking about trusted third parties, i.e. other entities which you trust to produce, hold, and process your money. It is assumed, for example, that you can trust your computer. As Ken Thompson showed in his Turing Award lecture, trust is an extremely tricky thing in the computational world. When running a program, you have to trust all kinds of software (and hardware) which, in theory, could alter the program you are trying to run in a malicious way. As Thompson summarized in his https://www.archive.ece.cmu.edu/~ganger/712.fall02/papers/p761-thompson.pdf[_Reflections on Trusting Trust_]: “The moral is obvious. You can’t trust code that you did not totally create yourself.”

.Ken Thompson Hack
image::https://21lessons.com/assets/images/ken-thompson-hack.png[Ken Thompson Hack, 300, align="center"]

Thompson demonstrated that even if you have access to the source code, your compiler  —  or any other program-handling program or hardware  —  could be compromised and detecting this backdoor would be very difficult. Thus, in practice, a truly _trustless_ system does not exist. You would have to create all your software _and_ all your hardware (assemblers, compilers, linkers, etc.) from scratch, without the aid of any external software or software-aided machinery.

[quote, Carl Sagan]
“If you wish to make an apple pie from scratch, you must first invent the universe.”

The Ken Thompson Hack is a particularly ingenious and hard-to-detect backdoor, so let’s take a quick look at a hard-to-detect backdoor which works without modifying any software. Researchers https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=Stealthy+Dopant-Level+Hardware+Trojans&btnG=[found a way] to compromise security-critical hardware by altering the polarity of silicon impurities. Just by changing the physical properties of the stuff that computer chips are made of they were able to compromise a cryptographically secure random number generator. Since this change can’t be seen, the backdoor can’t be detected by optical inspection, which is one of the most important tamper-detection mechanism for chips like these.

image::https://21lessons.com/assets/images/stealthy-hardware-trojan.png[Stealthy Dopant-Level Hardware Trojans by Becker, Regazzoni, Paar, Burleson, 300, align="center"]

Sounds scary? Well, even if you would be able to build everything from scratch, you would still have to trust the underlying mathematics. You would have to trust that https://en.bitcoin.it/wiki/Secp256k1[secp256k1] is an elliptic curve without backdoors. Yes, malicious backdoors can be inserted in the mathematical foundations of cryptographic functions and arguably this https://en.wikipedia.org/wiki/Dual_EC_DRBG[has already happened] at least once. There are good reasons to be paranoid, and the fact that everything from your hardware, to your software, to the elliptic curves used can have https://en.wikipedia.org/wiki/Elliptic-curve_cryptography#Backdoors[backdoors] are some of them.

[quote]
“Don’t trust. Verify.” </blockquote> The above examples should illustrate that _trustless_ computing is utopic. Bitcoin is probably the one system which comes closest to this utopia, but still, it is _trust-minimized_  — aiming to remove trust wherever possible. Arguably, the chain-of-trust is neverending, since you will also have to trust that computation requires energy, that P does not equal NP, and that you are actually in base reality and not imprisoned in a simulation by malicious actors. Developers are working on tools and procedures to minimize any remaining trust even further. For example, Bitcoin developers created https://gitian.org/[Gitian], which is a software distribution method to create deterministic builds. The idea is that if multiple developers are able to reproduce identical binaries, the chance of malicious tampering is reduced. Fancy backdoors aren’t the only attack vector. Simple blackmail or extortion are real threats as well. As in the main protocol, decentralization is used to minimize trust. Various efforts are being made to improve upon the chicken-and-egg problem of https://www.gnu.org/software/guix/manual/en/html_node/Bootstrapping.html[bootstrapping] which Ken Thompson’s hack so brilliantly pointed out. One such effort is https://www.gnu.org/software/guix/[Guix] (pronounced _geeks_), which uses functionally declared package management leading to bit-for-bit reproducible builds by design. The result is that you don’t have to trust any software-providing servers anymore since you can verify that the served binary was not tampered with by rebuilding it from scratch. Recently, a https://github.com/bitcoin/bitcoin/pull/15277[pull-request] was merged to integrate Guix into the Bitcoin build process.

image::https://21lessons.com/assets/images/guix-bootstrap-dependencies.png[Which came first, the chicken or the egg?, 300, align="center"]

Luckily, Bitcoin doesn’t rely on a single algorithm or piece of hardware. One effect of Bitcoin’s radical decentralization is a distributed security model. Although the backdoors described above are not to be taken lightly, it is unlikely that every software wallet, every hardware wallet, every cryptographic library, every node implementation, and every compiler of every language is compromised. Possible, but highly unlikely. Note that you can generate a private key without relying on any computational hardware or software. You can https://github.com/bitcoinbook/bitcoinbook/blob/develop/ch04.asciidoc#private-keys[flip a coin] a couple of times, although depending on your coin and tossing style this source of randomness might not be sufficiently random. There is a reason why storage protocols like https://glacierprotocol.org/[Glacier] advise to use casino-grade dice as one of two sources of entropy. Bitcoin forced me to reflect on what trusting nobody actually entails. It raised my awareness of the bootstrapping problem, and the implicit chain-of-trust in developing and running software. It also raised my awareness of the many ways in which software and hardware can be compromised. Bitcoin taught me not to trust, but to verify.

*Down the Rabbit Hole*

* https://www.archive.ece.cmu.edu/~ganger/712.fall02/papers/p761-thompson.pdf[Reflections on Trusting Trust] by Ken Thompson
* https://nakamotoinstitute.org/trusted-third-parties/[Trusted Third Parties Are Security Holes] by Nick Szabo
* https://bitcoin.org/bitcoin.pdf[The Bitcoin Whitepaper] by Satoshi Nakamoto
* https://bitcoin.org/en/developer-guide#term-51-attack[51% Attack] by Bitcoin Developer Guide Contributors
* https://www.gnu.org/software/guix/manual/en/html_node/Bootstrapping.html[Bootstrapping] by Guix Manual Contributors
* https://en.wikipedia.org/wiki/Dual_EC_DRBG[Dual EC DRBG] by Wikipedia Contributors
* https://en.wikipedia.org/wiki/Elliptic-curve_cryptography#Backdoors[ECC Backdoors] by Wikipedia Contributors
* https://en.bitcoin.it/wiki/Secp256k1[Secp256k1] by Bitcoin Wiki Contributors

== Lesson 17 - Telling time takes work
:figure-caption!:

[quote]
____
"Dear, dear! I shall be too late!"
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-17.m4a[Audio. Read by Guy Swan]

It is often said that bitcoins are mined because thousands of computers work on solving _very complex_ mathematical problems. Certain problems are to be solved, and if you compute the right answer, you “produce” a bitcoin. While this simplified view of bitcoin mining might be easier to convey, it does miss the point somewhat. Bitcoins aren’t produced or created, and the whole ordeal is not really about solving particular math problems. Also, the math isn’t particularly complex. What is complex is _telling the time_ in a decentralized system. As outlined in the whitepaper, the proof-of-work system (aka mining) is a way to implement a distributed timestamp server.

image::https://21lessons.com/assets/images/bitcoin-whitepaper-timestamp-wide.png[Excerpts from the whitepaper. Did someone say timechain?, 300, align="center"]

When I first learned how Bitcoin works I also thought that proof-of-work is inefficient and wasteful. After a while, I started to https://dergigi.com/2018/06/10/bitcoin-s-energy-consumption/[shift my perspective on Bitcoin’s energy consumption]. It seems that proof-of-work is still widely misunderstood today, in the year 13 AB (after Bitcoin). Since the problems to be solved in proof-of-work are made up, many people seem to believe that it is _useless_ work. If the focus is purely on the computation, this is an understandable conclusion. But Bitcoin isn’t about computation. It is about _independently agreeing on the order of things._ Proof- of-work is a system in which everyone can validate what happened and in what order it happened. This independent validation is what leads to consensus, an individual agreement by multiple parties about who owns what. In a radically decentralized environment, we don’t have the luxury of absolute time. Any clock would introduce a trusted third party, a central point in the system which had to be relied upon and could be attacked. “Timing is the root problem,” as Grisha Trubetskoy https://grisha.org/blog/2018/01/23/explaining-proof-of-work/[points out]. And Satoshi brilliantly solved this problem by implementing a decentralized clock via a proof-of-work blockchain. Everyone agrees beforehand that the chain with the most cumulative work is the source of truth. It is per definition what actually happened. This agreement is what is now known as Nakamoto consensus.

[quote, Satoshi Nakamoto]
“The network timestamps transactions by hashing them into an ongoing chain which serves as proof of the sequence of events witnessed”

Without a consistent way to tell the time, there is no consistent way to tell before from after. Reliable ordering is impossible. As mentioned above, Nakamoto consensus is Bitcoin’s way to consistently tell the time. The system’s incentive structure produces a probabilistic, decentralized clock, by utilizing both greed and self-interest of competing participants. The fact that this clock is imprecise is irrelevant because the order of events is eventually unambiguous and can be verified by anyone. Thanks to proof-of-work, both the work _and_ the validation of the work are radically decentralized. Everyone can join and leave at will, and everyone can validate everything at all times. Not only that, but everyone can validate the state of the system _individually_, without having to rely on anyone else for validation. Understanding proof-of-work takes time. It is often counter-intuitive, and while the rules are simple, they lead to quite complex phenomena. For me, shifting my perspective on mining helped. Useful, not useless. Validation, not computation. Time, not blocks. Bitcoin taught me that telling the time is tricky, especially if you are decentralized.
 

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2018/06/10/bitcoin-s-energy-consumption/[🔍 Bitcoin's Energy Consumption - A shift in perspective]
* https://dergigi.com/2021/01/14/bitcoin-is-time/[🔍 Bitcoin Is Time]

*Down the Rabbit Hole*

* http://www.truthcoin.info/blog/pow-cheapest/[Nothing is Cheaper than Proof of Work] by Paul Sztorc
* https://archive.is/3IpA4[Bitcoin Doesn’t Waste Electricity] by Beautyon
* https://grisha.org/blog/2018/01/23/explaining-proof-of-work/[Blockchain Proof-of-Work Is a Decentralized Clock] by Gregory Trubetskoy
* https://bitcointechtalk.com/the-anatomy-of-proof-of-work-98c85b6f6667[The Anatomy of Proof-of-Work] by Hugo Nguyen
* https://medium.com/@hugonguyen/work-is-timeless-stake-is-not-554c4450ce18[Work is Timeless, Stake is Not] by Hugo Nguyen
* https://www.unchained-capital.com/blog/bitcoin-does-not-waste-energy/[Bitcoin Does Not Waste Energy] by Parker Lewis
* https://unchained-capital.com/blog/law-of-hash-horizons/[Bitcoin Astronomy] by Dhruv Bansal
* https://www.coindesk.com/the-last-word-on-bitcoins-energy-consumption[The Last Word on Bitcoin’s Energy Consumption] by Nic Carter
* https://bitcoinmagazine.com/culture/the-hidden-costs-of-the-petrodollar[Uncovering The Hidden Costs Of The Petrodollar] by Alex Gladstein
* https://en.bitcoin.it/wiki/Controlled_supply[Controlled Supply] by Bitcoin Wiki Contributors
* https://en.bitcoin.it/wiki/Mining[Mining] by Bitcoin Wiki Contributors
* 🎧 https://www.theinvestorspodcast.com/episodes/trace-mayer-bitcoin/[Trace Mayer on Bitcoin Valuation, Trust, and Energy Consumption] TIP#252 hosted by Breston Pysh and Stig Brodersen
* 🎧 https://citizenbitcoin.world/episodes/robert-breedlove-understanding-time-money-and-bitcoin-from-first-principles[Robert Breedlove on Understanding Bitcoin from First Principles] CB#52 hosted by Brady Swenson

== Lesson 17 - Telling time takes work
:figure-caption!:

[quote]
____
"Dear, dear! I shall be too late!"
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-17.m4a[Audio. Read by Guy Swan]

It is often said that bitcoins are mined because thousands of computers work on solving _very complex_ mathematical problems. Certain problems are to be solved, and if you compute the right answer, you “produce” a bitcoin. While this simplified view of bitcoin mining might be easier to convey, it does miss the point somewhat. Bitcoins aren’t produced or created, and the whole ordeal is not really about solving particular math problems. Also, the math isn’t particularly complex. What is complex is _telling the time_ in a decentralized system. As outlined in the whitepaper, the proof-of-work system (aka mining) is a way to implement a distributed timestamp server.

image::https://21lessons.com/assets/images/bitcoin-whitepaper-timestamp-wide.png[Excerpts from the whitepaper. Did someone say timechain?, 300, align="center"]

When I first learned how Bitcoin works I also thought that proof-of-work is inefficient and wasteful. After a while, I started to https://dergigi.com/2018/06/10/bitcoin-s-energy-consumption/[shift my perspective on Bitcoin’s energy consumption]. It seems that proof-of-work is still widely misunderstood today, in the year 13 AB (after Bitcoin). Since the problems to be solved in proof-of-work are made up, many people seem to believe that it is _useless_ work. If the focus is purely on the computation, this is an understandable conclusion. But Bitcoin isn’t about computation. It is about _independently agreeing on the order of things._ Proof- of-work is a system in which everyone can validate what happened and in what order it happened. This independent validation is what leads to consensus, an individual agreement by multiple parties about who owns what. In a radically decentralized environment, we don’t have the luxury of absolute time. Any clock would introduce a trusted third party, a central point in the system which had to be relied upon and could be attacked. “Timing is the root problem,” as Grisha Trubetskoy https://grisha.org/blog/2018/01/23/explaining-proof-of-work/[points out]. And Satoshi brilliantly solved this problem by implementing a decentralized clock via a proof-of-work blockchain. Everyone agrees beforehand that the chain with the most cumulative work is the source of truth. It is per definition what actually happened. This agreement is what is now known as Nakamoto consensus.

[quote, Satoshi Nakamoto]
“The network timestamps transactions by hashing them into an ongoing chain which serves as proof of the sequence of events witnessed”

Without a consistent way to tell the time, there is no consistent way to tell before from after. Reliable ordering is impossible. As mentioned above, Nakamoto consensus is Bitcoin’s way to consistently tell the time. The system’s incentive structure produces a probabilistic, decentralized clock, by utilizing both greed and self-interest of competing participants. The fact that this clock is imprecise is irrelevant because the order of events is eventually unambiguous and can be verified by anyone. Thanks to proof-of-work, both the work _and_ the validation of the work are radically decentralized. Everyone can join and leave at will, and everyone can validate everything at all times. Not only that, but everyone can validate the state of the system _individually_, without having to rely on anyone else for validation. Understanding proof-of-work takes time. It is often counter-intuitive, and while the rules are simple, they lead to quite complex phenomena. For me, shifting my perspective on mining helped. Useful, not useless. Validation, not computation. Time, not blocks. Bitcoin taught me that telling the time is tricky, especially if you are decentralized.
 

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2018/06/10/bitcoin-s-energy-consumption/[🔍 Bitcoin's Energy Consumption - A shift in perspective]
* https://dergigi.com/2021/01/14/bitcoin-is-time/[🔍 Bitcoin Is Time]

*Down the Rabbit Hole*

* http://www.truthcoin.info/blog/pow-cheapest/[Nothing is Cheaper than Proof of Work] by Paul Sztorc
* https://archive.is/3IpA4[Bitcoin Doesn’t Waste Electricity] by Beautyon
* https://grisha.org/blog/2018/01/23/explaining-proof-of-work/[Blockchain Proof-of-Work Is a Decentralized Clock] by Gregory Trubetskoy
* https://bitcointechtalk.com/the-anatomy-of-proof-of-work-98c85b6f6667[The Anatomy of Proof-of-Work] by Hugo Nguyen
* https://medium.com/@hugonguyen/work-is-timeless-stake-is-not-554c4450ce18[Work is Timeless, Stake is Not] by Hugo Nguyen
* https://www.unchained-capital.com/blog/bitcoin-does-not-waste-energy/[Bitcoin Does Not Waste Energy] by Parker Lewis
* https://unchained-capital.com/blog/law-of-hash-horizons/[Bitcoin Astronomy] by Dhruv Bansal
* https://www.coindesk.com/the-last-word-on-bitcoins-energy-consumption[The Last Word on Bitcoin’s Energy Consumption] by Nic Carter
* https://bitcoinmagazine.com/culture/the-hidden-costs-of-the-petrodollar[Uncovering The Hidden Costs Of The Petrodollar] by Alex Gladstein
* https://en.bitcoin.it/wiki/Controlled_supply[Controlled Supply] by Bitcoin Wiki Contributors
* https://en.bitcoin.it/wiki/Mining[Mining] by Bitcoin Wiki Contributors
* 🎧 https://www.theinvestorspodcast.com/episodes/trace-mayer-bitcoin/[Trace Mayer on Bitcoin Valuation, Trust, and Energy Consumption] TIP#252 hosted by Breston Pysh and Stig Brodersen
* 🎧 https://citizenbitcoin.world/episodes/robert-breedlove-understanding-time-money-and-bitcoin-from-first-principles[Robert Breedlove on Understanding Bitcoin from First Principles] CB#52 hosted by Brady Swenson

== Lesson 18 - Move slowly and don't break things
:figure-caption!:

[quote]
____
So the boat wound slowly along, beneath the bright summer-day, with its merry crew and its music of voices and laughter...
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-18.m4a[Audio. Read by Guy Swan]

It might be a dead mantra, but “move fast and break things” is still how much of the tech world operates. The idea that it doesn’t matter if you get things right the first time is a basic pillar of the _fail early, fail often_ mentality. Success is measured in growth, so as long as you are growing everything is fine. If something doesn’t work at first you simply pivot and iterate. In other words: throw enough shit against the wall and see what sticks. Bitcoin is very different. It is different by design. It is different out of necessity. As Satoshi http://p2pfoundation.ning.com/forum/topics/bitcoin-open-source?commentId=2003008%3AComment%3A9493[pointed out], e-currency has been tried many times before, and all previous attempts have failed because there was a head which could be cut off. The novelty of Bitcoin is that it is a beast without heads.

[quote, Satoshi Nakamoto]
“A lot of people automatically dismiss e-currency as a lost cause because of all the companies that failed since the 1990’s. I hope it’s obvious it was only the centrally controlled nature of those systems that doomed them.”

One consequence of this radical decentralization is an inherent resistance to change. “Move fast and break things” does not and will never work on the Bitcoin base layer. Even if it would be desirable, it wouldn’t be possible without convincing _everyone_ to change their ways. That’s distributed consensus. That’s the nature of Bitcoin.

[quote, Satoshi Nakamoto]
“The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.”

This is one of the many paradoxical properties of Bitcoin. We all came to believe that anything which is software can be changed easily. But the nature of the beast makes changing it bloody hard. As Hasu beautifully shows in https://uncommoncore.co/unpacking-bitcoins-social-contract/[Unpacking Bitcoin’s Social Contract], changing the rules of Bitcoin is only possible by _proposing_ a change, and consequently _convincing_ all users of Bitcoin to adopt this change. This makes Bitcoin very resilient to change, even though it is software. This resilience is one of the most important properties of Bitcoin. Critical software systems have to be antifragile, which is what the interplay of Bitcoin’s social layer and its technical layer guarantees. Monetary systems are adversarial by nature, and as we have known for thousands of years solid foundations are essential in an adversarial environment.

[quote, Matthew 7:25]
“The rain came down, the floods came, and the winds blew, and beat on that house; and it didn’t fall, for it was founded on the rock.”

Arguably, in this parable of the wise and the foolish builders Bitcoin isn’t the house. It is the rock. Unchangeable, unmoving, providing the foundation for a new financial system. Just like geologists, who know that rock formations are always moving and evolving, one can see that Bitcoin is always moving and evolving as well. You just have to know where to look and how to look at it. The introduction of https://en.bitcoin.it/wiki/Pay_to_script_hash[pay to script hash] and https://en.bitcoin.it/wiki/Segregated_Witness[segregated witness] are proof that Bitcoin’s rules can be changed if enough users are convinced that adopting said change is to the benefit of the network. The latter enabled the development of the https://lightning.network/[lightning network], which is one of the houses being built on Bitcoin’s solid foundation. Future upgrades like https://github.com/sipa/bips/blob/bip-taproot/bip-0340.mediawiki#Applications[Schnorr signatures] will enhance efficiency and privacy, as well as scripts (read: smart contracts) which will be indistinguishable from regular transactions thanks to https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2018-January/015614.html[Taproot]. Wise builders do indeed build on solid foundations. Satoshi wasn’t only a wise builder technologically. He also understood that it would be necessary to make wise decisions ideologically.

[quote, Satoshi Nakamoto]
“Being open source means anyone can independently review the code. If it was closed source, nobody could verify the security. I think it’s essential for a program of this nature to be open source.”

Openness is paramount to security and inherent in open source and the free software movement. As Satoshi pointed out, secure protocols and the code which implements them have to be open  —  there is no security through obscurity. Another benefit is again related to decentralization: code which can be run, studied, modified, copied, and distributed freely ensures that it is spread far and wide. The radically decentralized nature of Bitcoin is what makes it move slowly and deliberately. A network of nodes, each run by a sovereign individual, is inherently resistant to change  —  malicious or not. With no way to force updates upon users the only way to introduce changes is by slowly convincing each and every one of those individuals to adopt a change. This non-central process of introducing and deploying changes is what makes the network incredibly resilient to malicious changes. It is also what makes fixing broken things more difficult than in a centralized environment, which is why everyone tries not to break things in the first place. Bitcoin taught me that moving slowly is one of its features, not a bug.

*Down the Rabbit Hole*

* https://www.unchained-capital.com/blog/bitcoin-is-not-too-slow/[Bitcoin Is Not Too Slow] by Parker Lewis
* https://en.wikipedia.org/wiki/Parable_of_the_Wise_and_the_Foolish_Builders[Parable of the Wise and the Foolish Builders] by Wikipedia Contributors
* https://en.bitcoin.it/wiki/Segregated_Witness[Segregated Witness (SegWit)] by Bitcoin Wiki Contributors
* https://en.bitcoin.it/wiki/Pay_to_script_hash[Pay to Script Hash (P2SH)] by Bitcoin Wiki Contributors
* https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2018-January/015614.html[Taproot proposal] by Gregory Maxwell
* https://github.com/sipa/bips/blob/bip-schnorr/bip-schnorr.mediawiki#cite_ref-6-0[Schnorr signatures BIP] by Pieter Wuille

== Lesson 19 - Privacy is not dead
:figure-caption!:

[quote]
____
The players all played at once without waiting for turns, and quarrelled all the while at the tops of their voices, and in a very few minutes the Queen was in a furious passion, and went stamping about and shouting "off with his head!" or "off with her head!" about once in a minute.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-19.m4a[Audio. Read by Guy Swan]

If pundits are to believed, privacy has been dead https://books.google.com/ngrams/graph?content=privacy+is+dead&amp;year_start=1970&amp;year_end=2019&amp;corpus=15&amp;smoothing=3&amp;share=&amp;direct_url=t1%3B%2Cprivacy%20is%20dead%3B%2Cc0[since the 80ies]. The pseudonymous invention of Bitcoin and other events in recent history show that this is not the case. Privacy is alive, even though it is by no means easy to escape the surveillance state. Satoshi went through great lengths to cover up his tracks and conceal his identity. Thirteen years later, it is still unknown if Satoshi Nakamoto was a single person, a group of people, male, female, or a https://blockchain24-7.com/is-crypto-creator-a-time-travelling-ai/[time-traveling AI] which bootstrapped itself to take over the world. Conspiracy theories aside, Satoshi chose to identify himself to be a Japanese male, which is why I don’t assume but respect his chosen gender and refer to him as _he_.

image::https://21lessons.com/assets/images/nope.png[I am not Dorian Nakamoto., 300, align="center"]

Whatever his real identity might be, Satoshi was successful in hiding it. He set an encouraging example for everyone who wishes to remain anonymous: it is possible to have privacy online.

[quote, Edward Snowden]
“Encryption works. Properly implemented strong crypto systems are one of the few things that you can rely on.”

Satoshi wasn’t the first pseudonymous or anonymous inventor, and he won’t be the last. Some have directly imitated this pseudonymous publication style, like Tom Elvis Yedusor of https://github.com/mimblewimble/docs/wiki/MimbleWimble-Origin[MimbleWimble] fame, while others have published advanced mathematical proofs while remaining completely https://oeis.org/A180632/a180632.pdf[anonymous]. It is a strange new world we are living in. A world where identity is optional, contributions are accepted based on merit, and people can collaborate and transact freely. It will take some adjustment to get comfortable with these new paradigms, but I strongly believe that all of this has the potential to change the world for the better. We should all remember that privacy is a http://www.un.org/en/universal-declaration-human-rights/[fundamental human right]. And as long as people exercise and defend these rights the battle for privacy is far from over. Bitcoin taught me that privacy is not dead.
 

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2020/07/21/true-names-not-required/[🔍 True Names Not Required]

*Down the Rabbit Hole*

* https://nakamotoinstitute.org/digital-cash-and-privacy/[Digital Cash &amp; Privacy] by Hal Finney
* https://nakamotoinstitute.org/the-case-for-privacy/[The Case for Privacy] by David D. Friedman
* https://bitcoin.org/en/protect-your-privacy[Protect Your Privacy] by Bitcoin.org
* https://bitcoinmagazine.com/articles/how-the-lightning-network-layers-privacy-on-top-of-bitcoin-1482183775[How Lightning Layers Privacy on Top of Bitcoin] by Aaron van Wirdum
* https://medium.com/@thecryptoconomy/dandelions-and-a-bright-future-for-bitcoin-privacy-712dbc4b1ec5[Dandelions, and a Bright Future for Bitcoin Privacy] by Guy Swann
* https://www.coincenter.org/the-case-for-electronic-cash-in-an-open-and-free-society/[The Case for Electronic Cash] by Jerry Brito
* https://coincenter.org/entry/we-must-protect-our-ability-to-transact-privately-online[We Must Protect our Ability to Transact Privately Online] by Jerry Brito
* https://en.bitcoin.it/wiki/Privacy[Bitcoin Wiki’s Privacy Aritcle] by Chris Belcher
* https://medium.com/human-rights-foundation-hrf/privacy-and-cryptocurrency-part-i-how-private-is-bitcoin-e3a4071f8fff[How Private is Bitcoin?] by Eric Wall
* https://www.youtube.com/watch?v=UDydB3z-6Y0[Bitcoin and Privacy] by Edward Snowden
* https://bitcoinmagazine.com/culture/the-hidden-costs-of-bitcoin-adoption[Bitcoin And The Hidden Costs Of Hyper-Adoption] by L0la L33tz
* https://www.un.org/en/universal-declaration-human-rights/[Universal Declaration of Human Rights] by the United Nations
* https://oeis.org/A180632/a180632.pdf[A lower bound on the length of the shortest superpattern] by Anonymous 4chan Poster, Robin Houston, Jay Pantone, and Vince Vatter
* 🎧 https://cryptoandgrill.podbean.com/e/bitcoin-privacy-security-and-personal-sovereignty-w-jameson-lopp/[Jameson Lopp on Privacy, Security, and Personal Sovereignty] C&amp;G#35 hosted by CryptoDantes and Stigofthepump
* 🎧 https://stephanlivera.com/episode/178/[6102bitcoin on Bitcoin Privacy, Education, KYC, and Pseudonymity] SLP#178 hosted by Stephan Livera
* 📚 https://amzn.to/3ql8C6h[American Kingpin - The Epic Hunt for the Criminal Mastermind Behind the Silk Road] by Nick Bilton

== Lesson 20 - Cypherpunks write code
:figure-caption!:

[quote]
____
I see you're trying to invent something.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-20.m4a[Audio. Read by Guy Swan]

Like many great ideas, Bitcoin didn’t come out of nowhere. It was made possible by utilizing and combining many innovations and discoveries in mathematics, physics, computer science, and other fields. While undoubtedly a genius, Satoshi wouldn’t have been able to invent Bitcoin without the giants on whose shoulders he was standing on.

[quote, Ludwig Von Mises]
“He who only wishes and hopes does not interfere actively with the course of events and with the shaping of his own destiny.”

One of these giants is Eric Hughes, one of the founders of the cypherpunk movement and author of the https://www.activism.net/cypherpunk/manifesto.html[cypherpunk manifesto]. It’s hard to imagine that Satoshi wasn’t influenced by this manifesto. It speaks of many things which Bitcoin enables and utilizes, such as direct and private transactions, electronic money and cash, anonymous systems, and defending privacy with cryptography and digital signatures.

[quote, Eric Hughes]
“Privacy is necessary for an open society in the electronic age. […] Since we desire privacy, we must ensure that each party to a transaction have knowledge only of that which is directly necessary for that transaction. […] Therefore, privacy in an open society requires anonymous transaction systems. Until now, cash has been the primary such system. An anonymous transaction system is not a secret transaction system. […] We the Cypherpunks are dedicated to building anonymous systems. We are defending our privacy with cryptography, with anonymous mail forwarding systems, with digital signatures, and with electronic money. Cypherpunks write code.”

Cypherpunks do not find comfort in hopes and wishes. They actively interfere with the course of events and shape their own destiny. Cypherpunks write code. Thus, in true cypherpunk fashion, Satoshi sat down and started to write code. Code which took an abstract idea and proved to the world that it actually worked. Code which planted the seed of a new economic reality. Thanks to this code, everyone can verify that this novel system actually works, and every 10 minutes or so Bitcoin proofs to the world that it is still living.

image::https://21lessons.com/assets/images/bitcoin-v0.1-code.png[Code excerpts from Bitcoin version 0.1.0, 300, align="center"]

To make sure that his innovation transcends fantasy and becomes reality, Satoshi wrote code to implement his idea before he wrote the whitepaper. He also made sure https://bitcointalk.org/index.php?topic=199.msg1670#msg1670[not to delay] any release forever. After all, “there’s always going to be one more thing to do.”

[quote, Satoshi Nakamoto]
“I had to write all the code before I could convince myself that I could solve every problem, then I wrote the paper.”

In today’s world of endless promises and doubtful execution, an exercise in dedicated building was desperately needed. Be deliberate, convince yourself that you can actually solve the problems, and implement the solutions. We should all aim to be a bit more cypherpunk. Bitcoin taught me that cypherpunks write code.
 

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2021/06/13/bitcoin-is-an-idea/[🔍 Bitcoin Is an Idea]

*Down the Rabbit Hole*

* http://groups.csail.mit.edu/mac/classes/6.805/articles/crypto/cypherpunks/may-crypto-manifesto.html[The Crypto Anarchist Manifesto] by Timothy C. May
* https://www.activism.net/cypherpunk/manifesto.html[A Cypherpunk’s Manifesto] by Eric Hughes
* https://ia600208.us.archive.org/10/items/cyphernomicon/cyphernomicon.txt[The Cyphernomicon] by Timothy C. May
* http://www.metzdowd.com/pipermail/cryptography/2008-October/014810.html[Bitcoin P2P e-cash paper announcement] by Satoshi Nakamoto
* https://bitcointalk.org/index.php?topic=68121.0[Bitcoin version 0.1.0 announcement] by Satoshi Nakamoto
* https://youtu.be/9vM0oIEhMag[Cypherpunks Write Code] by ReasonTV
* 📚 https://amzn.to/3wSQdzT[Cypherpunks - Freedom and the Future of the Internet] by Jacob Appelbaum Julian Assange Andy Zimmermann
* 📚 https://amzn.to/39KNltn[The Book Of Satoshi - The Collected Writings of Bitcoin Creator Satoshi Nakamoto] by Phil Champagne

== Lesson 21 - Metaphors for Bitcoin's future
:figure-caption!:

[quote]
____
I know something interesting is sure to happen...
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/3-21.m4a[Audio. Read by Guy Swan]

In the last couple of decades, it became apparent that technological innovation does not follow a linear trend. Whether you believe in the technological singularity or not, it is undeniable that progress is exponential in many fields. Not only that, but the rate at which technologies are being adopted is accelerating, and before you know it the bush in the local schoolyard is gone and your kids are using Snapchat instead. Exponential curves have the tendency to slap you in the face way before you see them coming. Bitcoin is an exponential technology built upon exponential technologies. https://ourworldindata.org/[Our World in Data] beautifully shows https://www.visualcapitalist.com/rising-speed-technological-adoption/[the rising speed of technological adoption], starting in 1903 with the introduction of landlines. Landlines, electricity, computers, the internet, smartphones; all follow exponential trends in price-performance and adoption. Bitcoin does too.

.Bitcoin is literally off the charts.
image::https://21lessons.com/assets/images/tech-adoption.png[Bitcoin is literally off the charts., 300, align="center"]

Bitcoin has not one but https://nakamotoinstitute.org/mempool/the-seven-network-effects-of-bitcoin/[multiple network effects], all of which resulting in exponential growth patterns in their respective area: price, users, security, developers, market share, and adoption as global money. Having survived its infancy, Bitcoin is continuing to grow every day in more aspects than one. Granted, the technology has not reached maturity yet. It might be in its adolescence. But if the technology is exponential, the path from obscurity to ubiquity is short.

.Mobile phone, ca 1965 vs 2019.
image::https://21lessons.com/assets/images/mobile-phone.png[Mobile phone, ca 1965 vs 2019., 300, align="center"]

In his 2003 https://www.ted.com/talks/jeff_bezos_on_the_next_web_innovation[TED talk], Jeff Bezos chose to use electricity as a metaphor for the web’s future. All three phenomena  —  electricity, the internet, Bitcoin  —  are _enabling_ technologies, networks which enable other things. They are infrastructure to be built upon, foundational in nature. Electricity has been around for a while now. We take it for granted. The internet is quite a bit younger, but most people already take it for granted as well. Bitcoin is ten years old and has entered public consciousness during the last hype cycle. Only the earliest of adopters take it for granted. As https://en.wikipedia.org/wiki/Lindy_effect[more time] passes, more and more people will recognize Bitcoin as something which simply is. In 1994, the internet was still confusing and unintuitive. Watching this old https://www.youtube.com/watch?v=UlJku_CSyNg[recording of the Today Show] makes it obvious that what feels natural and intuitive now actually wasn’t back then. Bitcoin is still confusing and alien to most, but just like the internet is second nature for digital natives, spending and https://twitter.com/hashtag/stackingsats[stacking] sats will be second nature to the bitcoin natives of the future.

[quote, William Gibson]
“The future is already here  —  it’s just not very evenly distributed.”

In 1995, about 15% of American adults used the internet. Historical https://www.pewinternet.org/2014/02/27/part-1-how-the-internet-has-woven-itself-into-american-life/[data from the Pew Research Center] shows how the internet has woven itself into all our lives. According to a https://www.kaspersky.com/blog/money-report-2018/[consumer survey] by Kaspersky Lab, 13% of respondents have used Bitcoin and its clones to pay for goods in 2018. While payments aren’t the only use-case of bitcoin, it is some indication of where we are in Internet time: in the early- to mid-90s. In 1997, Jeff Bezos stated in a http://media.corporate-ir.net/media_files/irol/97/97664/reports/Shareholderletter97.pdf[letter to shareholders] that “this is Day 1 for the Internet,” recognizing the great untapped potential for the internet and, by extension, his company. Whatever day this is for Bitcoin, the vast amounts of untapped potential are clear to all but the most casual observer.

.The internet, 1982 vs 2005. Source: cc-by Merit Network, Inc. and Barrett Lyon, Opte Project
image::https://21lessons.com/assets/images/internet-evolution-black-dates.png[The internet, 1982 vs 2005. Source: cc-by Merit Network, Inc. and Barrett Lyon, Opte Project, 300, align="center"]

Bitcoin’s first node went online in 2009 after Satoshi mined the https://en.bitcoin.it/wiki/Genesis_block[genesis block] and released the software into the wild. His node wasn’t alone for long. Hal Finney was one of the first people to pick up on the idea and join the network. Ten years later, as of this writing, more than https://luke.dashjr.org/programs/bitcoin/files/charts/software.html[75.000] nodes are https://twitter.com/halfin/status/1110302988?lang=en[running bitcoin]. The protocol’s base layer isn’t the only thing growing exponentially. The lightning network, a second layer technology, is growing at an even faster rate. In January 2018, the lightning network had https://bitcoinist.com/bitcoin-lightning-network-mainnet-nodes/[40 nodes] and 60 channels. In April 2019, the network grew to more than 4000 nodes and around 40.000 channels. Keep in mind that this is still experimental technology where loss of funds can and does occur. Yet the https://twitter.com/lopp/status/1077200836072296449[trend is clear]: thousands of people are https://twitter.com/hashtag/reckless[reckless] and eager to use it.

.Lightning Network, January 2018 vs December 2018. Source: Jameson Lopp
image::https://21lessons.com/assets/images/lnd-growth-lopp-black.png[Lightning Network, January 2018 vs December 2018. Source: Jameson Lopp, 300, align="center"]

To me, having lived through the meteoric rise of the web, the parallels between the internet and Bitcoin are obvious. Both are networks, both are exponential technologies, and both enable new possibilities, new industries, new ways of life. Just like electricity was the best metaphor to understand where the internet is heading, the internet might be the best metaphor to understand where Bitcoin is heading. Or, in the words of Andreas Antonopoulos, Bitcoin is https://theinternetofmoney.info/[_The Internet of Money_]. These metaphors are a great reminder that while history doesn’t repeat itself, it often rhymes. Exponential technologies are hard to grasp and often underestimated. Even though I have a great interest in such technologies, I am constantly surprised by the pace of progress and innovation. Watching the Bitcoin ecosystem grow is like watching the rise of the internet in fast-forward. It is exhilarating. My quest of trying to make sense of Bitcoin has led me down the pathways of history in more ways than one. Understanding ancient societal structures, past monies, and how communication networks evolved were all part of the journey. From the handaxe to the smartphone, technology has undoubtedly changed our world many times over. Networked technologies are especially transformational: writing, roads, electricity, the internet. All of them changed the world. Bitcoin has changed mine and will continue to change the minds and hearts of those who dare to use it. Bitcoin taught me that understanding the past is essential to understanding its future. A future which is just beginning.
 

'''

*Through the Looking-Glass 🔍*

Follow-up articles that expand upon ideas discussed in this lesson: 

* https://dergigi.com/2019/07/23/the-world-is-waking-up-to-bitcoin/[🔍 The World is Waking Up to Bitcoin]
* https://dergigi.com/2020/03/20/dear-legacy-people/[🔍 Dear Legacy People]
* https://dergigi.com/2020/03/31/dear-bitcoiners/[🔍 Dear Bitcoiners - An optimistic letter to friends and foes around the globe]
* https://dergigi.com/2020/04/27/dear-family-dear-friends/[🔍 Dear Family, Dear Friends]
* https://dergigi.com/2020/09/20/on-bitcoin-s-ux/[🔍 On Bitcoin's UX]

*Down the Rabbit Hole*

* https://www.ted.com/talks/jeff_bezos_on_the_next_web_innovation[The Electricity Metaphor for the Web’s Future] by Jeff Bezos
* https://www.pewinternet.org/2014/02/27/part-1-how-the-internet-has-woven-itself-into-american-life/[How the internet has woven itself into American life] by Susannah Fox and Lee Rainie
* https://nakamotoinstitute.org/mempool/hyperbitcoinization/[Hyperbitcoinization] by Daniel Krawisz
* https://nakamotoinstitute.org/mempool/speculative-attack/[Speculative Attack] by Pierre Rochard
* https://www.thrivenotes.com/the-7-network-effects-of-bitcoin/[The 7 Network Effects of Bitcoin] by Trace Mayer
* https://www.visualcapitalist.com/rising-speed-technological-adoption/[The Rising Speed of Technological Adoption] by Jeff Desjardins
* https://medium.com/coinmonks/hyperbitcoinization-winner-takes-all-69ab59f9695f[Hyperbitcoinization - Winner Takes All] by ObiWan Kenobit
* https://unchained-capital.com/blog/bitcoin-not-blockchain/[Bitcoin, Not Blockchain] by Parker Lewis
* https://www.citadel21.com/you-are-not-prepared[You Are Not Prepared] by Knut Svanholm
* https://en.bitcoin.it/wiki/Genesis_block[Genesis Block] by Bitcoin Wiki Contributors
* https://en.wikipedia.org/wiki/Lindy_effect[Lindy Effect] by Wikipedia Contributors
* https://twitter.com/Croesus_BTC/status/1271165665236246529[Bitcoin and Technology Adoption S-Curves] by Bitcoin Croesus
* 🎧 https://player.fm/series/off-the-chain-2428336/murad-mahmudov-the-ultimate-bitcoin-argument[Murad Mahmudov on The Ultimate Bitcoin Argument] OTC#25 hosted by Pomp
* 🎧 https://anchor.fm/tales-from-the-crypt/episodes/Tales-from-the-Crypt-55-BitcoinTINA-aka-Rick-Flex-e2vpt9[Bitcoin Tina on Why he is Bullish on Bitcoin] TFTC#55 hosted by Marty Bent
* 🎧 https://www.hiddenforces.io/podcast/hyperbitcoinization-bitcoin-maximalist-pierre-rochard[Pierre Rochard on Hyperbitcoinization and Bitcoin Maximalism] HF#75 hosted by Demetri Kofinas
* 🎧 https://www.theinvestorspodcast.com/bitcoin-fundamentals/btc007-bitcoin-disrupting-payment-clearing-houses-w-jack-mallers/[Jack Mallers on how Bitcoin Disrupts Payment Clearing Houses] TIP#BTC007 hosted by Preston Pysh
* 🎧 https://www.whatbitcoindid.com/podcast/el-salvador-the-whole-story[Jack Mallers on El Salvador's Bitcoin Standard] WBD#362 hosted by Peter McCormack

== Conclusion
:figure-caption!:

[quote]
___
"Begin at the beginning," the King said, very gravely, "and go on till you come to the end: then stop."
___

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/4-00.m4a[Audio. Read by Guy Swan]

As mentioned in the beginning, I think that any answer to the question _“What have you learned from Bitcoin?”_ will always be incomplete. The symbiosis of what can be seen as multiple living systems  —  Bitcoin, the technosphere, and economics  —  is too intertwined, the topics too numerous, and things are moving too fast to ever be fully understood by a single person.

Even without understanding it fully, and even with all its quirks and seeming shortcomings, Bitcoin undoubtedly works. It keeps producing blocks roughly every ten minutes and does so beautifully. The longer Bitcoin continues to work, the more people will opt-in to use it.

[quote, Giannina Braschi, Empire of Dreams]
“It’s true that things are beautiful when they work. Art is function.”

Bitcoin is a child of the internet. It is growing exponentially, blurring the lines between disciplines. It isn’t clear, for example, where the realm of pure technology ends and where another realm begins. Even though Bitcoin requires computers to function efficiently, computer science is not sufficient to understand it. Bitcoin is not only borderless in regards to its inner workings but also boundaryless in respect to academic disciplines.

Economics, politics, game theory, monetary history, network theory, finance, cryptography, information theory, censorship, law and regulation, human organization, psychology  —  all these and more are areas of expertise which might help in the quest of understanding how Bitcoin works and what Bitcoin is.

No single invention is responsible for its success. It is the combination of multiple, previously unrelated pieces, glued together by game theoretical incentives, which make up the revolution that is Bitcoin. The beautiful blend of many disciplines is what makes Satoshi a genius.

Like every complex system, Bitcoin has to make tradeoffs in terms of efficiency, cost, security, and many other properties. Just like there is no perfect solution to deriving a square from a circle, any solution to the problems which Bitcoin tries to solve will always be imperfect as well.

[quote, Friedrich Hayek]
“I don’t believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can’t take it violently out of the hands of government, all we can do is by some sly roundabout way introduce something that they can’t stop.”

Bitcoin is the sly, roundabout way to re-introduce good money to the world. It does so by placing a sovereign individual behind each node, just like Da Vinci tried to solve the intractable problem of squaring a circle by placing the Vitruvian Man in its center. Nodes effectively remove any concept of a center, creating a system which is astonishingly antifragile and extremely hard to shut down. Bitcoin lives, and its heartbeat will probably outlast all of ours.

I hope you have enjoyed these twenty-one lessons. Maybe the most important lesson is that Bitcoin should be examined holistically, from multiple angles, if one would like to have something approximating a complete picture. Just like removing one part from a complex system destroys the whole, examining parts of Bitcoin in isolation seems to taint the understanding of it. If only one person strikes “blockchain” from her vocabulary and replaces it with “a chain of blocks” I will die a happy man.

In any case, my journey continues. I plan to venture further down into the depths of this https://21lessons.com/rabbithole[rabbit hole], and I invite you to https://patreon.com/dergigi[tag along] for the ride.

== Acknowledgements

[quote]
"Thank you," said Alice

Thanks to the countless authors and content producers who influenced my thinking on Bitcoin and the topics it touches. There are too many to list them all, but I’ll do my best to name a few.

* Thanks to https://twitter.com/arjunblj[Arjun Balaji] for https://twitter.com/arjunblj/status/1050073234719293440[the tweet] which motivated me to write this.
*Thanks to https://twitter.com/martybent[Marty Bent] for providing endless food for thought and entertainment. If you are not subscribed to http://eepurl.com/cROArD[Marty’s Ƀent] and https://talesfromthecrypt.libsyn.com/[Tales From The Crypt], you are missing out. Cheers https://twitter.com/matt_odell[Matt] and Marty for guiding us through the rabbit hole.
*Thanks to https://twitter.com/bitstein[Michael Goldstein] and https://twitter.com/pierre_rochard[Pierre Rochard] for curating and providing the greatest Bitcoin literature via the http://nakamotoinstitute.org[Nakamoto Institute]. And thank you for creating the https://noded.org/[Noded Podcast] which influenced my philosophical views on Bitcoin substantially.
*Thanks to https://twitter.com/whatbitcoindid[Peter McCormack] for his https://twitter.com/PeterMcCormack/status/1073196778705559553[honest tweets] and the https://www.whatbitcoindid.com/podcast[What Bitcoin Did] podcast, which keeps providing great insights from many areas of the space.
*Thanks to https://twitter.com/aantonop[Andreas M. Antonopoulos] for all the https://antonopoulos.com/[educational material] he has put out over the years.
*Thanks to https://twitter.com/saifedean[Saifedean Ammous] for his convictions, savage tweets, and writing The Bitcoin Standard
*Thanks to https://twitter.com/francispouliot_[Francis Pouliot] for sharing his excitement about finding out about the https://twitter.com/francispouliot_/status/1106028072799744002[timechain].
*Thanks to https://twitter.com/jnnksbrt[Jannik], https://twitter.com/bquittem[Brandon], https://twitter.com/matt_odell[Matt], https://twitter.com/CamiloJdL[Camilo], https://twitter.com/dnlggr[Daniel], https://twitter.com/michael_rogger[Michael], and https://twitter.com/dinemuatta[Raphael] for providing feedback to early drafts of some lessons. Special thanks to https://twitter.com/jnnksbrt[Jannik] who proofread multiple drafts multiple times.
*Thanks to https://twitter.com/dhruvbansal[Dhruv Bansal] and https://twitter.com/matt_odell[Matt Odell] for taking the time to discuss some of these ideas with me.
*Thanks to https://twitter.com/TheCryptoconomy[Guy Swann] for producing an audio version of 21lessons.com.

Last but not least, thanks to all the bitcoin maximalists, shitcoin minimalists, shills, bots, and shitposters which reside in the beautiful garden that is Bitcoin twitter. And finally, thank _you_ for reading this. I hope you enjoyed it as much as I did enjoy writing it.

Feel free to reach out to me https://twitter.com/dergigi[on X] or https://njump.me/npub1dergggklka99wwrs92yz8wdjs952h2ux2ha2ed598ngwu9w7a6fsh9xzpc[on Nostr] nostr:npub1dergggklka99wwrs92yz8wdjs952h2ux2ha2ed598ngwu9w7a6fsh9xzpc. My DMs are open.

== Thank You

...for reading, for being here, for trying to understand.

[quote]
____

"It seems very pretty," she said when she had finished it, "but it’s rather hard to understand!"
____

Thank you for reading 21 Lessons. If you enjoyed the book, please https://amzn.to/2VXmQgp[buy a copy], https://amzn.to/2VXmQgp[leave a review], or share it with your friends. You can also https://dergigi.shop[buy a signed copy]. If you have any suggestions for improvements, please reach out to me https://dergigi.com/contact/[here]. https://amzn.to/2Wa4qJo[Buy the book!] (...or https://dergigi.com/support/[support me] directly)

I am currently working on a second, more ambitious project: http://21waysbook.com[21 Ways]. You can https://www.patreon.com/dergigi[support me on Patreon] to get an exclusive glimpse and early access to current drafts, artwork, and other things. You can also https://dergigi.com/support/[support me directly] via bitcoin.

Your support allows me to allocate more time to writing and creating free, open-source education. It’s what I love to do. I hope that I will be able to dedicate all my time to it one day. To all of you who support me already: thank you. From the bottom of my heart.

Thank you. 🙏🧡

== Translations بيتكوين

[quote]
____

These words were followed by a very long silence, broken only by an occasional exclamation of "hjckrrh!"
____

.Print
* 🇺🇸 https://amzn.to/2Wa4qJo[English: 21 Lessons] - What I’ve Learned from Falling Down the Bitcoin Rabbit Hole (https://amzn.to/2Wa4qJo[Paperback], https://amzn.to/3bvM49P[Kindle])
* 🇩🇪 https://amzn.to/2AtlfWZ[German: 21 Lektionen] - Meine Reise in den Bitcoin Kaninchenbau (https://amzn.to/2AtlfWZ[Paperback], https://amzn.to/2Z2zts3[Kindle])
* 🇪🇸 https://amzn.to/41G4AHG[Spanish: 21 Lecciones] - Lo Que He Aprendido Al Caer En La Madriguera De Bitcoin (https://amzn.to/41G4AHG[Paperback], https://amzn.to/3Zvh6Ic[Kindle])
* 🇪🇸 https://prometeabtc.com/libros/[Spanish: 21 Lecciones (by Prometea)] - Lo Que He Aprendido Al Caer En La Madriguera De Bitcoin (https://prometeabtc.com/libros/[ebook])
* 🇫🇮 https://amzn.to/2WYYkKL[Finnish: 21 Oppituntia] - Mitä olen oppinut pudottuani Bitcoinin kaninkoloon (https://amzn.to/2WYYkKL[Paperback])
* 🇳🇱 https://konsensus.network/product/21-lessen/[Dutch: 21 Lessen] - Wat Ik Heb Geleerd Door Mijn Val In Het Bitcoinkonijnenhol (https://konsensus.network/product/21-lessen/[Paperback])
* 🇫🇷 https://amzn.to/3DUxs1O[French: 21 Leçons] - Enseignements tirés de ma chute dans le terrier du lapin Bitcoin (https://amzn.to/3DUxs1O[Paperback], https://amzn.to/3DZ9ouK[Kindle])
* 🇮🇹 https://amzn.to/3mBu6KW[Italian: 21 Lezioni] - Cosa ho imparato nel cadere dentro la tana del Bianconiglio (https://amzn.to/3mBu6KW[Paperback], https://amzn.to/3NPMgEY[Kindle])
* 🇧🇷 https://monsterabooks.com/products/21-licoes[Brazilian Portuguese: 21 Lições] - O que aprendi ao cair da toca do coelho do Bitcoin (https://monsterabooks.com/products/21-licoes[Paperback])
* 🇪🇪 https://liigalihtne.ee/pood/index.php/toode/21oppetundi/[Estonian: 21 õppetundi] - Mida ma õppisin Bitcoini jäneseurgu kukkumisest (https://liigalihtne.ee/pood/index.php/toode/21oppetundi/[Paperback])
* 📗 https://www.lulu.com/shop/gigi-and-daniel-araque-acosta/21-lecionoj-kion-mi-lernis-falante-la-bitmono-kuniklotruon/paperback/product-d5v5d9.html?page=1&amp;pageSize=4[Esperanto: 21 lecionoj] - Kion mi lernis falante la Bitmono-kuniklotruon (https://www.lulu.com/shop/gigi-and-daniel-araque-acosta/21-lecionoj-kion-mi-lernis-falante-la-bitmono-kuniklotruon/paperback/product-d5v5d9.html?page=1&amp;pageSize=4[Paperback])
* 🇷🇴 https://iblock.ro/sp/bitcoin-21-lectii/[Romanian: 21 de lecții] - Ce am invățat despre bani, libertate si prosperitate din căzătura în vizuina iepurașului (https://iblock.ro/sp/bitcoin-21-lectii/[Paperback])
* 🇨🇿 https://shop.bitperia.cz/products/21-lekci-co-me-naucil-pad-do-bitcoinove-kralici-nory[Czech: 21 lekcí] - Co mě naučil pád do bitcoinové králičí nory (https://shop.bitperia.cz/products/21-lekci-co-me-naucil-pad-do-bitcoinove-kralici-nory[Paperback], https://drive.google.com/file/d/1R2VAoa-ctq6CBg9Zs_1pvT9Q489I5Eaa/view?usp=sharing[ePub])
* 🇩🇰 https://shop21.dk/?product=21-lektioner[Danish: 21 Lektioner] - Hvad jeg lærte af at falde ned i Bitcoin-kaninhullet (https://shop21.dk/?product=21-lektioner[Paperback])

.PDF
* 🇧🇷 https://github.com/KoreaComK/21lessons-book[Brazilian Portuguese: 21 Lições] - O que aprendi ao cair da toca do coelho do Bitcoin (https://github.com/KoreaComK/21lessons-book[LaTeX], https://github.com/KoreaComK/21lessons-book/raw/master/pdf/As%2021%20Li%C3%A7%C3%B5es.pdf[PDF])
* 🇫🇷 https://github.com/prplsknk/21lessons-book[French: 21 Leçons] - Enseignements tirés de ma chute dans le terrier du lapin Bitcoin (https://github.com/prplsknk/21lessons-book[LaTeX], https://github.com/prplsknk/21lessons-book/raw/master/21%20Le%C3%A7ons.pdf[PDF])
* 🇷🇸 http://files.suritranslations.com/Serbian/21LekcijaLatinica.pdf[Serbian: 21 Lekcija] - Šta sam naučio padajući u zečju rupu - (http://files.suritranslations.com/Serbian/21LekcijaLatinica.pdf[Latin PDF], http://files.suritranslations.com/Serbian/21LekcijaCyrillica.pdf[Cyrillic PDF])
* 🇨🇿 https://shop.bitperia.cz/products/21-lekci-co-me-naucil-pad-do-bitcoinove-kralici-nory[Czech: 21 lekcí] - Co mě naučil pád do bitcoinové králičí nory (https://drive.google.com/file/d/1kFgftYGMJ00F8JZRq5S_vT6WawENagE7/view?usp=share_link[PDF])
* 🇩🇰 https://github.com/Shop21DK/21-Lektioner[Danish: 21 Lektioner] - Hvad jeg lærte af at falde ned i Bitcoin-kaninhullet (https://github.com/Shop21DK/21-Lektioner/blob/master/21%20Lektioner%20-%20latest%20version.pdf[PDF])

.Audio versions
See https://21lessons.com/audio[/audio] for audiobooks, audio versions, commentary, and podcast episodes.

.Online versions
* 🇮🇹 The https://gabridome.github.io/21-lezioni/[Italian version] of the website is available thanks to https://twitter.com/gabridome[gabridome]
* 🇸🇰 The https://1lubo.github.io/byzantine_general/[Slovak version] of the website is available thanks to https://twitter.com/LuboD5[LuboD]
* 🇨🇿 The https://sifrant.github.io/21lekci/[Czech version] of the website is available thanks to https://twitter.com/nekonecnik[sifrant]

.Chapter translations
* 🇪🇸 https://medium.com/@dergigi/ense%C3%B1anzas-filos%C3%B3ficas-de-bitcoin-8ae1357357f9[Chapter I], https://telegra.ph/Cap%C3%ADtulo-II--Econom%C3%ADa-11-01[Chapter II], and https://telegra.ph/Cap%C3%ADtulo-III--Tecnolog%C3%ADa-11-01[Chapter III] is available in Spanish thanks to https://twitter.com/CamiloJdL[@CamiloJdL] and https://t.me/ur_Entropy[Ξntropy].
* 🇹🇷 https://medium.com/@denizozzgur/bitcoinin-felsefi-%C3%B6%C4%9Fretileri-e7df2338a2fc[Chapter I], https://medium.com/@denizozzgur/bitcoinin-ekonomi-%C3%B6%C4%9Fretileri-a3e87dcff525[Chapter II], and https://medium.com/@denizozzgur/blockchainin-teknolojik-%C3%B6%C4%9Fretileri-34ae5a6949a7[Chapter III] is available in Turkish thanks to https://twitter.com/deniz_zgur[@deniz_zgur]. Note that the order of the chapters is different in the Turkish translation.
* 🇨🇳 https://mirror.xyz/andywan.eth/xdQ6YAzyfg44Lnlrv1l29jF218Ds4S44plR2WN0mvzA[Chapter I], https://mirror.xyz/andywan.eth/xdQ6YAzyfg44Lnlrv1l29jF218Ds4S44plR2WN0mvzA[Chapter II], and https://mirror.xyz/andywan.eth/xdQ6YAzyfg44Lnlrv1l29jF218Ds4S44plR2WN0mvzA[Chapter III] is available in Chinese thanks to https://twitter.com/andywan[@andywan]. Some additional images and figures were added.
* 🇩🇪 https://medium.com/@cryptomulde/122bcc603afb[Chapter I], https://medium.com/@cryptomulde/78f38793e17a[Chapter II], and https://medium.com/@cryptomulde/26b86c456dc[Chapter III] is available in German thanks to https://twitter.com/CryptoMulde[@CryptoMulde].
* 🇩🇪 https://www.blocktrainer.de/bitcoin-21-lektionen/[Another German translation] was done by https://www.blocktrainer.de/author/rene/[Rene] from blocktrainer.
* 🇫🇮 https://medium.com/brandin-kirjasto/21-oppituntia-82db42069528[Chapter I], https://medium.com/brandin-kirjasto/21-oppituntia-7e3433fecc58[Chapter II], and https://medium.com/brandin-kirjasto/21-oppituntia-1d9f343eafea[Chapter III] are available in Finnish thanks to https://twitter.com/thlbr[Thomas Brand]. The entry point of the Finnish rabbit hole is https://medium.com/brandin-kirjasto/21-oppituntia-110265683fce[here].
* 🇧🇷 https://youtu.be/XV2bxmA1EXA?list=PLgcVYwONyxmgRqmVN3dl87waF-EvyULHe[Chapter I], https://youtu.be/0B9pzGt06Z0?list=PLgcVYwONyxmgRqmVN3dl87waF-EvyULHe[Chapter II], and https://youtu.be/IrEk97349dk?list=PLgcVYwONyxmgRqmVN3dl87waF-EvyULHe[Chapter III] are available in Brazilian Portuguese thanks to https://twitter.com/bitdov[Bit Dov]. The entry point of the Brazilian rabbit hole is https://www.youtube.com/playlist?list=PLgcVYwONyxmgRqmVN3dl87waF-EvyULHe[here].
* 🇯🇵 https://alischool.me/magazines/katakoto/21lessons[Chapter I], https://alis.to/katakoto/articles/aZqz5LorA0Z9[Chapter II], and https://alis.to/katakoto/articles/365Q0JGyp9PZ[Chapter III] is available in Japanese thanks to https://twitter.com/katakoto[katakoto].
* 🇬🇷 https://niclick.org/philosophy[Chapter I], https://niclick.org/economics[Chapter II], and https://niclick.org/technology[Chapter III] is available in Greek thanks to https://twitter.com/niclick[nikos].
* 🇮🇷 https://arzdigital.com/bitcoin-21-lessons/[Chapter I, Chapter II, and Chapter III] is available in Persian thanks to https://twitter.com/Gorfist[Nima]. Also available https://bitcoind.me/blobs/books/21Lessons_ArzDigital.pdf[as a PDF].
* 🇮🇩 https://medium.com/@hazmitri/21-pelajaran-dari-bitcoin-bagian-pertama-filosofi-86ba0b39e0c[Chapter I] and https://medium.com/@hazmitri/21-pelajaran-dari-bitcoin-bagian-kedua-ekonomi-e6ba6d9a7a70[Chapter II] is available in Indonesian thanks to https://twitter.com/hazmithril[Hazmi Tri Laksono]
* 🇭🇺 https://coincrumb.com/2021/10/15/21-lecke/[Chapter I, Chapter II, and Chapter III] is available in Hungarian thanks to https://twitter.com/CoinCrumb[CoinCrumb]. It’s also available as a https://coincrumb.com/wp-content/uploads/2021/10/21-Lecke-PDF-Gigi.zip[PDF] and as an https://coincrumb.com/wp-content/uploads/2021/10/21-Lecke-EPUBMOBI-Gigi.zip[epub &amp; mobi].
* 🇸🇦 https://bitcoinarabic.org/21-lessons-dergigi/[Chapter I, Chapter II, and Chapter III] is available in Arabic thanks to https://twitter.com/BTCTranslator[BTCTranslator].
* 🇮🇳 https://memebadger.com/lesson-1-immutability-and-change/[Lesson 1], https://gandhifamily.in/lesson-2-the-scarcity-of-scarcity/[Lesson 2], https://gandhifamily.in/lesson-3-replication-and-locality/[Lesson 3], and https://gandhifamily.in/lesson-4-the-problem-of-identity/[Lesson 4] is available in Hindi thanks to https://memebadger.com/[Badger]
* 🇵🇱 https://telegra.ph/21-LEKCJI-01-23[Chapter I] is available in Polish thanks to https://twitter.com/fkenfkg2fjsks[MF]

.Remixes
* 🎮 https://21lessons.com/vr[21 Lessons VR] by BITPAINT

.Reviews
* https://youtu.be/Dfa89zx6D3o[🇹🇷 Turkish video review] by Stackmore

== Readings and Commentary

[quote]
____

She waited for some time without hearing anything more: at last came a rumbling of little cart-wheels, and the sound of a good many voices all talking together.
____

.Audio. Read by Guy Swan
audio::https://21lessons.com/assets/audio/21lessons/21-lessons.m4a[Audio. Read by Guy Swan]

.Audiobook
* 🇺🇸 The https://amzn.to/2ZeUsYX[English audiobook] is available on https://amzn.to/2ZeUsYX[Audible] and https://anchor.fm/thecryptoconomy/episodes/CryptoQuikRead_256---21-Lessons-of-the-Bitcoin-Rabbit-Hole---Chapter-1-e47u83[Bitcoin Audible]
* 🇩🇪 The https://amzn.to/3khg7Z3[German audiobook] is available on https://aprycot.media/blog/gigis-21-lektionen-hoerbuch/[Aprycot], https://amzn.to/3khg7Z3[Audible], and https://youtu.be/36zfTwKDcLM[YouTube]
* 🇧🇷 The https://youtu.be/B2-yU3IfAi8[Brazilian Portuguese audiobook] is available on https://youtu.be/B2-yU3IfAi8[YouTube]

.Reading
* 🇺🇸 🎧 https://anchor.fm/thecryptoconomy/episodes/CryptoQuikRead_256---21-Lessons-of-the-Bitcoin-Rabbit-Hole---Chapter-1-e47u83[Chapter I], https://anchor.fm/thecryptoconomy/episodes/CryptoQuikRead_257---21-Lessons-of-the-Bitcoin-Rabbit-Hole---Chapter-2-e489f9[Chapter II], and https://anchor.fm/thecryptoconomy/episodes/CryptoQuikRead_258---21-Lessons-of-the-Bitcoin-Rabbit-Hole---Chapter-3-e48kao[Chapter III] are available as an audio version thanks to https://twitter.com/TheCryptoconomy[Guy Swann] from https://cryptoconomy.life/[The Cryptoconomy] podcast.
* 🇩🇪 🎧 The https://pod.link/1611020042/episode/959dbb77d4d2d032b29e9e814aac94f6[German book] was read on the https://pod.link/1611020042/[Bitcoin Bibliothek] podcast and is available on all podcasting platforms.

.Commentary
Below are recordings of thoughts, discussions, and commentary on 21 Lessons, thanks to the fine folks who were kind enough to interview me:

*English*

* https://citizenbitcoin.world/episodes/gigi-21-lessons-from-down-the-bitcoin[21 Lessons] on Citizen Bitcoin

*German*

* https://media.zencast.fm/bitcoin-im-turm/episodes/8[21 Lessons, Chapter 1] on Bitcoin im Turm
* https://media.zencast.fm/bitcoin-im-turm/episodes/9[21 Lessons, Chapter 2] on Bitcoin im Turm
* https://media.zencast.fm/bitcoin-im-turm/episodes/10[21 Lessons, Chapter 3] on Bitcoin im Turm

You can find more podcast interviews and discussions at my https://dergigi.com/media/[media archive].

== Down the Rabbit Hole

[quote]
I almost wish I hadn't gone down that rabbit-hole, and yet, and yet - it's rather curious, you know, this sort of life.

THE END