Quote note (#144)

Pete Dushenski on the reactionary case for Bitcoin, the lead up:

Gold balanced the forces of the world. As such, no matter where you went, gold was transferable to the local currency. Whether you were in France or Florence, your gold was good. In fact, if you weren’t in your own backyard, using your own community’s debt instruments, gold was basically the only thing that was accepted. So whether you wanted to buy a copy of the Bible, fight a foreign war, or build a palace, you needed gold.

Then came The Revolution: replacing the Monarch, the Church, and generally anything good by instituting “reforms” and encouraging “progress” in the name of “the people.” At first, the sheer number of supporters of constitutional democracy was sufficient to establish this social experiment. Eventually, however, sheer numbers would prove insufficient. Why? Because this “new” system failed on every account to educate its supporters on the essential matters of politics and economics, leaving them intellectually high and dry and prone to the exact golden calves that the Church and Monarch were protecting them from. As a result, after experiencing a bit of lifestyle creep, an newfound and ever-growing sense of entitlement began to take root. And oh did those roots grow deep.

The roots grew so deep that the electorate began knocking on democracy’s door, demanding more and more. Where once they were thankful for their new liberties and freedoms, they soon found themselves adrift at sea, lost and without cause. To unyoke this infinite expansion of wants from the finite, gold-bound resources of the state, the Revolutionaries had no choice but to take hold of the money supply of their nations, wresting it from the grasp of sound money and all the goodness and balance it had fostered. This was the only way to keep up the ruse and placate the electorate. So they instituted Central Banking at a scale never before seen. …

(The whole thing is glorious, including — in the original — footnotes.)

January 14, 2015admin 36 Comments »
FILED UNDER :Political economy


36 Responses to this entry

  • outsider Says:

    Hillary “Satan” Clinton may try to win by promising different things to targeted interest groups in swing states. Whoever has the better software wins.

    More generous public pensions and healthcare plans, full legalization and easier immigration, federal police oversight, strengthening No Child Left Behind, and SocSec & Medicare increases starting after the conclusion of her second term.

    Digital currencies will be allowed but all transactions must be registered with a government server.


    SVErshov Reply:

    in bitcoins blockchain all transactions is public, available to anyone. Because bitcoins is IP based network, it is quite possible to collect IPs from where transactions originated. In fact nobody know for sure how many bitcoins supernode servers in fact runs by govts.


    Posted on January 14th, 2015 at 7:36 am Reply | Quote
  • Quote note (#144) | Reaction Times Says:

    […] Source: Outside In […]

    Posted on January 14th, 2015 at 8:01 am Reply | Quote
  • Henk Says:

    Agreed on enlightened government’s Bitcoin policy, except that you don’t need to register transactions, just wallets. Transactions are out in the open.

    Holding Bitcoin in a registered wallet: Good citizen. Holding Bitcoin in a non-registered wallet: Tax evading criminal. Transactions between your registered wallet and a tax evading criminal’s wallet: Grounds for an audit.

    Given that deflationary gains in your wallet are (of course) taxable and that wider Bitcoin adaption would be a big deflationary force, what’s not to like from the state perspective?


    SVErshov Reply:

    governments always criminalizing things by prohibiting it. but they are able to learn too – prohibition never works. transaction on bitcoin network depends on miners, at present deflationary btc price trend, it may happens that only miners who subsidized by govt will survive. Independent miners are not able to cover electricity cost in most countries. There are many nontrivial methods to control bitcoins are available for government. Even they can make some profit in process. No doubts fed will confront anything threatening usd.


    Posted on January 14th, 2015 at 9:12 am Reply | Quote
  • spandrell Says:

    *cough* Bitcoin is under $200 right now *cough*

    Just sayin’


    admin Reply:

    So it’s only increased in value against the US$ by 260,000 times or so since October 2009.


    Alrenous Reply:

    “Bitstamp | A market order to buy 10000 bitcoins right now would take 2557358.6607 USD and would take the last price up to 420.3600 USD, resulting in an average price of 255.7359 USD/BTC. | Data vintage: 0.0087 seconds ”

    Market cap is so low Peter Thiel could change it by 25% on a whim. It’s got no inertia, hence the volatility.


    Posted on January 14th, 2015 at 11:41 am Reply | Quote
  • SVErshov Says:


    it does not look pretty for those who invested at 250 and that were large hedge funds. we have panic sale now and it formed double bottom already. But market is thin … can be easily moved in any direction.


    Posted on January 14th, 2015 at 1:27 pm Reply | Quote
  • Kgaard Says:

    The real question to ask: How do you create a crypto-currency whose value is stable against, say, a basket of gold, commodities and fiat currencies? Then you might have something …


    John Reply:

    The stability issue with resolve with time as BItcoin edges towards equilibrium. It doesn’t need to be backed by a basket of commodities or anything else. To do its job, Bitcoin just needs to be hard.


    soapjackal Reply:



    Obviously bitcoin is a commodity that has many similarities to gold but trying to just upend the entire economy sphere with one commodity isnt going to work out so well. OT just takes the useful functions of bitcoin and expands upon them into not just crypto-currencies but a full sweet of crypto market tools.


    Posted on January 14th, 2015 at 3:49 pm Reply | Quote
  • Kgaard Says:

    By the way that Dushenski essay is horrible. We have gone far, far beyond every point he makes here on this blog, 10 times. He also makes a bunch of dumb mistakes that we have corrected here as well.


    Posted on January 14th, 2015 at 4:00 pm Reply | Quote
  • Alrenous Says:

    Ha, he even embedded the full text of the footnotes in the link hover tooltip. Nice.


    Posted on January 14th, 2015 at 4:16 pm Reply | Quote
  • SVErshov Says:

    The real question to ask: How do you create a crypto-currency whose value is stable against, say, a basket of gold, commodities and fiat currencies? Then you might have something …

    now a days just about everyone creating some crypto. it has many uses, sure. But crypto currencies stable against gold, it is in the past: Egold, Libertyreserve ect

    I would rather think in opposite direction crypto with maximum unpredictability. Horror crypto!!!


    Kgaard Reply:

    Egold … I like the sound of that. But of course now we are confronted with a meta-problem: A ridiculously low barrier to entry to get into the crypto-currency business, leading to a proliferation of crypto-currencies. Taken as a whole, crypto currencies themselves are a form of fiat! Even worse than fiat, actually, since you can’t use them to pay your taxes …


    Erebus Reply:

    Horror crypto? A ridiculous notion. Besides, I don’t know what you could do to make the cryptocurrency market more unpredictable than it is right now.

    That’s an interesting point about E-gold and Libertyreserve, though. The USG certainly didn’t take very kindly to both of ’em, but that has more to do with the fact that both companies were extremely poorly managed and were marketed as “financial services” providers. (Somewhere between Western Union and private banking.) There should be reasonable, and long-term-sustainable, ways to peg cryptocurrencies to commodities and fiat currencies. It’s certainly an extremely intriguing idea…


    SVErshov Reply:

    Horror crypto? A ridiculous notion. Besides, I don’t know what you could do to make the cryptocurrency market more unpredictable than it is right now.

    unpredictability and volatility exactly what draw money to bitcoins. Any hedge fund manager would kill for 5% volatility per week. In bitcoins it is normal this week we 50% drop.


    Kgaard Reply:

    Volatility without some rational underlying model for understanding what is going on is useless. How should a hedge fund manager value bitcoin? The fact that it’s underlying structure is fatally flawed — because if it caught on its price would soar — means that paradoxically bitcoin is fundamentally almost useless. Therefore it should have very little value. Over time I could see bitcoin going to zero, actually. It will be like the beer can collecting craze of 1976, which cost me a couple hundred bucks when the bottom fell out.

    Posted on January 14th, 2015 at 4:18 pm Reply | Quote
  • SVErshov Says:

    If you sold bitconis for 1 mln usd 4 days ago, now you can buy your bitcoins back and keep 500000usd in your pocket. Seems like good deal to me. Of course bitcoins price manipulated, it is not difficult considering relatively small btc market cap. But almost everything is manipulated nowadays. Oil price manipulated too, still oil quite useful.

    in 2020 last bitcoin will be mined, no more new bitcoins I doubt its value will go to zero. people who invested in bitcoins don’t like to see their investments vanishing. As Carl Sagan wrote: – been too skeptical you can miss good things.


    Kgaard Reply:

    Well, we’ll see. I contend bitcoin is fundamentally flawed and that a zero valuation is one among several possible scenarios. Its only use is providing anonymity. I presume there are other ways to do that — and if there aren’t yet there will be soon.


    SVErshov Reply:

    Bitcoins do not provide anonymity. in most bitcoin transactions on blockchain.info anyone can see IP of the person from whom this transaction originated. To anonymize it, some other quite serious measures have to be taken. People who writing about bitcons usually dont have much idea about it. It goes same with many other areas. Sort of indicator of gradual degradation of writing community world wide.


    Kgaard Reply:

    Well then bitcoin is utterly, completely useless and is properly worth zero. It’s not a store of value, not a widely-accepted medium of exchange and not a widely recognized unit of account. It can’t grow into the two latter functions because it is not, and never will be, a reliable store of value. So it’s useless, and thus worthless.

    Nathan Cook Reply:

    Blockchain.info connects to a (largish) subset of full nodes, of which there are usually about 6000. (And here they are.) It won’t record your IP if you’re using a light client like Electrum (although your Electrum server might). Basically, while it’s possible for a competent threat to link transactions to IPs, it’s not just a case of looking it up on a website.

    I agree that ‘serious measures’ are needed properly to anonymize transaction origin. However this does not equate to overly complex measures. Accessing a web wallet via Tor would have a good chance of success even against three letter agencies, provided of course they weren’t already interested in you.

    Posted on January 14th, 2015 at 5:28 pm Reply | Quote
  • soapjackal Says:

    If Gold is Reactionary than Open-Transactions is Neoreactionary and bitcoin is merely libertarian.

    This is one of those moments that I wish I had a blog. Of course I won’t be running one yet (and even when I do it wont be neoreactionary as you know it) so I’ll just post my thoughts on this matter in comment format. Once Jackal Quarterly is done with Cameralism, Anti-Fragilitys Tangential Topics, The German Enlightenment, and The Hyperboreans I will move onto the technology behind Open-Transactions, Money/Economics in reactionary history, Non-State Actors, and Cults. Thats pretty far off so heres just a quick reaction.


    Libertarian anti-state sound money

    Oh its going to be one of those articles. I have alot of respect for groups that at least recognize that the modern state isnt a moral good and that this cannot last forever. I am not a fan of the anarchistic assumption that all government is statist and the associated rhetoric. Yes Gold does a better job at alot of things for the common man than fiat currencies but make no mistake it can be manipulated.

    This rhetoric becomes really irritating when the author drops this bomb as an arguement why the Demon Hive will not shift the current fiat regime:

    “It’s too limiting for their “noble” needs”

    Its their needs and desires. Yeah ‘noble’ is in quotes but its not making a rhetorical ploy against those wishing the state to be God on earth and that they know better but that its pure elite sentiment causing this. If he really was going to make claims against corrupt elite trying to push the common man out with ‘noble’ lies he could easily put some much needed economic historical context.

    I did enjoy the article however the central enemy that seems to be highlighted is “The masses.” While populism and drawing the population in as the justification for the State did allow for some motive power there is much more to the transfer to fiat currency than ‘THE MASSES DEMANDED IT.’ The masses were sold it. Much as the masses were sold the income tax. The Demon Hive is always working hard to fuck people over.

    There are also bits (while seemingly randomly added in) that I did thoroughly enjoy.

    “The US is financially bankrupt because it’s morally bankrupt. Not the reverse.”

    “Basically, the US is broke because the Revolutionaries broke it.”

    Hahahah. Fantastic. This first quote is on the money (recognizing that there is more than just moral failure that leads to demonic incentives). The second quote is an unintended jab against the Founders if youre NRx.

    Basically the article seems to drop the ball on giving any practical or moral reason that bitcoin is the exact counter revolution and weakens the conclusion considerably. This isnt exactly uncommon in libertarian writings. All in all Thank The Lord for Footnotes. I was talking about why I wish I saw more of those things in neoreactionary blogs within the past few days coincidentally enough.


    Its no surprise that Technocommercialists **cough** libertarians not triggered by sane government **cough** would be drawn to this article. Trying to attach the reactionary rhetoric and theme to libertarian foci such as Money,Armies, and Courts really is the way to got to get those incels to open their minds alittle.

    With that out of the way lemme tell you guys about Open-Transactions.

    What is Open-Transactions?

    Introductory Explanation:


    Illustrated Explanation:

    Forbes Take:

    Monetas – If it requires an expanation that we have failed (Hasnt come out yet so since its not competing against the Demonic Hive yet I can only hope that this will be true eventually)

    Chris Odom (Fellow Traveler) on bitcoin and monetas:

    Short Rhetorical Intros


    Montas in July 2014 and Showing it off:

    Hour Long Talk in Switzerland describing specifics.

    Bitcoin is a pretty badass application of certain cryptographic technologies and opens up a world where people consider that the central banks are probably not the only thing we have to live with. Now people attached all sorts of mystical revolutionary zeal to bitcoin. Heralding it as the true agora. Then it shined as a speculative commodity and soon everyone sorta forgot about the thing. Bitcoin is not functioning as a stable store of value or a useful technology for making daily transactions. It also requires a great amount of trust. These all lead to bitcoin being not so useful for mass adoption and application. Chris Spends 30 minutes discussing the specifics of the troubles with this Digital Gold.

    The Troubles with Bitcoin:

    Basically what Chris did was create a decentralized crypo market framework for unforgeable receipts, actually anonymous digital currency, smart contracts, secure asset trading and account creation and a fully GUI for actually using this technology for the lay person (which will be released in its commercial form of Monetas).The software’s author likens it to “PGP for money”.

    Chris Describes the Various ways OT solves the troubles of bitcoin:

    Market exchange, Untraceable transactions, Instant settlement, Micro-transactions, Cash streaming protocols, Operates securely on low-trust servers, No transaction history, Full range of financial instruments, Smart contracts, Client-side scripting, In-game representations of real-world financial environments, and Protection against online wallet fraud.


    Open-Transactions is a combination of server and client side software. The client software is used for wallets, trade, communication, and anything else the user is going to be using OT for. The server side software is only there for 3rd party verification and signing. As well as utilizing voting pool systems in order to prevent fraud and ‘bank robberies’ as we have seen with the bitcoin system.

    To Reiterate: Open-Transactions is not a crypto currency. Instead it is a tool box that offers the practical generation of effective crypto-markets.

    Since I am not utopian I do admit that there are possible problems with it:


    However they are not at all the same type of issues affecting bitcoin and offers a method for competing currencies so that we arent stuck with the dichotomy of bitcoin vs fiat.

    Neoreactionary Applications:

    First off: MONEY

    If you can figure out why open-transactions is so powerful you can guess at its possible uses and potential big bucks to be made. Everyone needs to eat and finding ways of independently funding oneself is what gave Moldbug the time to actually sit down and create the flawed yet interesting Unqualified Reservations. This cant be volunteer for long if people want to get great things done.

    Second: Kicking one of the real enemies right in the teeth

    Neoreaction does not spend much time with banking. Now the libertarians spend almost all their time with the bankers but seriously there is so much left to discuss on the topic and the financial system is a major components of the Demons Hive. Its a major component of almost all governmental policy, revolution and warfare. Strike at the purse and you weaken the enemy immeasurably.

    Third: Decentralized Exit in place for communities

    Now exit>voice when considering purely physical exit is an interesting debate. However communities being able to exit the current financial casino without having to leave their homes really allows for a true counter revolution to be incentivized with the people. There are other things that need to happen for this to be totally plausible but creating tools for people to organically find their own destiny seems like the only way NRx has a shot.

    Fourth: Escape the bitcoin debate.

    The bitcoin debate has come to the point where people realize its not going to usher in the new era and honestly it doesnt have the rhetorical bite it used to.

    Fifth: It gives the Cameralists something to do

    Metacameralism and the moldbug conceptions really dont do the history of the cameralists any justice. I am producing a large project on the Cameralists as my first NRx published work and I will go into more detail but the cameralists were created primarily for figuring out ways to fill Frederic The Firsts coffers. If neoreaction is going to take any hints from the cameralists it is far better to figure out practical ways that crypto-markets can help fund the Decentralized Duchies rather than try to pass off Joint Stock Republicanism or Formalism as anything deeply resembling the Cameralist Tradition.

    Sixth: Colonialism

    One of the major applications of open transactions is not just offering tools for agorists to pump value into stable society but it allows the third world unbanked economy to be something that civilized men can access. There will be some real economic incentive for groups other than the Chinese to really consider doing something with the Dark Continent which can benefit both the Natives and the Neoreactionaries.

    Thats all I really can justify in a comment for now but I implore those who have read this to really spend the time looking at Open-Transactions and seeing how it can be more useful to Neoreaction Today than Bitcoin ever will.


    Posted on January 15th, 2015 at 10:07 am Reply | Quote
  • SVErshov Says:

    “Since I am not utopian I do admit that there are possible problems with it:


    However they are not at all the same type of issues affecting bitcoin and offers a method for competing currencies so that we arent stuck with the dichotomy of bitcoin vs fiat.”

    what you saying is that for some reason (pardon, it is hard to comprehend for me) open transactions is better then btcoins. Well, how it can be so, if bitcoins does not have any of those grave vulnerabilities. And most of opentransactionss futures already implemented in bitcoins.


    soapjackal Reply:

    you should probably read the whole thing instead of just skimming along and assuming that OT is a direct competitor to bitcoin and trying to make an edgy comeback.

    >Well, how it can be so, if bitcoins does not have any of those grave vulnerabilities

    they arent

    a. that grave

    b. and bitcoin has a host of separate problems elaborated above

    c. that vulnerability page is just a token for intellectual honesty. Nothing is perfect. However some things are less problematic than others.

    > And most of opentransactionss futures already implemented in bitcoins.

    bro. You didnt even read this. If you had and knew what bitcoin did and what OT did you would recognize that most of bitcoins actual capacities and ‘futures’ are not along the same lines as OT except in idealistic dreams.


    SVErshov Reply:

    I read your article completely, as well OT about and vulnerability page. sure there is some development, but it just look like another crypto, with raw code and which may even never take off. I’ve been with bitcoins since 2011 and all that time I see somebody bashing bitcoins and declaring it dead. I do not have idealistic dreams about bitcoins either, with same success I can make assumption that you are having idealistic dreams about OT and at least I even have a reason to think that way.


    soapjackal Reply:

    Considering that OT really isnt another crypto I dont know what it is that you read.

    I did not declare Bitcoin dead. I said that it lacks the capacity to live up to the idealistic dreams often ascribed to it.

    I really have no reason to believe that you read anything but the vulnerabilities link and youre trying to back track.

    >with same success I can make assumption that you are having idealistic dreams about OT

    how exactly?

    Posted on January 15th, 2015 at 3:44 pm Reply | Quote
  • R. Says:

    These guys are really funny:





    Posted on January 15th, 2015 at 6:35 pm Reply | Quote
  • soapjackal Says:

    @Kgaard yeah. It really isnt that good of a piece of writing.


    Posted on January 15th, 2015 at 11:37 pm Reply | Quote
  • SVErshov Says:

    #What is Open-Transactions?
    #Open-Transactions is an easy-to-use, financial crypto, digital cash and transaction library.

    it is from about page, seems like it is you who do not read it.

    #how exactly?

    if you see in others that they are having some “idealistic dreams” and they have not, then it is you who are having “idealistic dreams”


    soapjackal Reply:

    Im merely referring to the various end goals ascribed to bitcoin (replacing fiat in the short term for a currency revolution for example) that are often idealistic.

    However you are skirting the question by just saying “since you think others are idealistic you are idealistic’ which isnt really meaningful in any logical fashion.

    Yeah. Its a crypto library. Not a direct bitcoin competitor. They are synergistic. You wave it away like its some dime a dozen competitor.


    Posted on January 16th, 2015 at 9:41 am Reply | Quote
  • Spending all your time figuring out what kind of “-ism” you and your friends believe in so that you can call each other “whatever-ists” is no way to improve the world. | Contravex: A blog by Pete Dushenski Says:

    […] quite naturally with the comments in response to Nick Land‘s republishing of my post,iii flowing from the article seen in Exhibit A, it appears […]

    Posted on January 17th, 2015 at 8:31 pm Reply | Quote
  • This Week in Reaction (2015/01/23) | The Reactivity Place Says:

    […] do you do?” to Pete Dushenski in The University of Neoreaction. Dushenski was noticed by Nick Land saying, “The Revolution Was Fiat. The Reaction is Bitcoin.” Well, certainly, The […]

    Posted on January 24th, 2015 at 9:11 am Reply | Quote
  • The University of Neoreaction | Poseidon Awoke: Realist Says:

    […] shine to your writings and I appreciate the critique. I found the link to the site in Land’s Quote note (#144), linking to Pete’s article ‘The Revolution Was Fiat, The Reaction Is Bitcoin‘ and […]

    Posted on February 27th, 2016 at 12:47 pm Reply | Quote

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