The Agenda

Generative Bitcoin

Tim Lee argues that Bitcoin is a generative technology:

This 2012 presentation by Mike Hearn and this related article describes a broad class of Bitcoin applications that could prove important in the future. Bitcoin doesn’t just enable cash to be transferred from one person to another, it also has a sophisticated system of multi-signature transactions that allow the creation of complex electronic contracts.

For example, suppose Alice wants to buy a product from Bob but isn’t sure Bob is trustworthy. Bitcoin allows her to create a transaction that pays Bob but makes payment contingent on Charlie’s approval. Even better, the transaction can be structured so that Charlie can’t take the money himself. His only options are to send the money on to Bob or send it back to Alice. In his talk, Hearn also describes how to create kickstarter-style fundraising campaigns and practical micropayments—all without needing to trust intermediaries.

Last week my former graduate advisor Ed Felten wrote about plans to build a decentralized prediction market using Bitcoin. The Sunlight Foundation’s Eric Mill recently tweeted that “decentralized, immutable records of activity guaranteed by network consensus are revolutionary, and only Bitcoin is doing it.”

As for longer-term applications, I’ve long predicted that international money transfers are a market that’s likely to be disrupted by Bitcoin. Nobody has built a turnkey Western Union alternative, but the emergence of Bitcoin ATMs is a first step toward low-cost international money transfers.

We don’t know which technology will turn out to be Bitcoin’s “killer app” — but there are enough possibilities that it is not unreasonable to expect that at some one application will take off.

And Micah Sifry of TechPresident reports that Fight for the Future, a grassroots pressure group that focuses on protecting the Internet from censorship, has taken up Bitcoin as its latest cause:

Last week, Fight for the Future, the Internet freedom group that played a big role in kicking off the movement that stopped the SOPA and PIPA bills, announced that it was taking on a new cause: Bitcoin. Together with Bitcoin evangelist Jon Holmquist, they put together “>BitcoinBlackFriday.com” as a hub for more than 250 online vendors who are accepting the digital currency, some of them offering special deals through the site. The vendors include OK Cupid, Reddit, CheapAir.com, and the Internet Archive.

In rolling this out, FFTF’s co-founders, Tiffiniy Cheng and Holmes Wilson, made some strong statements about Bitcoin’s value to people interested in social change, arguing that a) the digital currency was a good way to avoid hidden transaction fees that traditional financial service providers charge, to the detriment of poor people; and b) it makes it harder to profile people based on their purchases.

I think it’s high time that Kevin Williamson weighed in on this phenomenon with a lengthy article …

 

Reihan Salam — Reihan Salam is executive editor of National Review and a National Review Institute policy fellow.

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