The Bitcoin Standard: The Decentralized Alternative to Central Banking

THE ESSENTIAL GUIDE TO BITCOIN′S HISTORY, PROPERTIES, USES, AND FUTURE

"Bitcoin has no owner, no authority that can decide on its fate. It is owned by the crowd, its users. And it now has a track record of several years, enough for it to be an animal in its own right. Its mere existence is an insurance policy that will remind governments that the last object the establishment could control, namely, the currency, is no longer their monopoly. This gives us, the crowd, an insurance policy against an Orwellian future."
From the Foreword by Nassim Nicholas Taleb

In The Bitcoin Standard, economist Saifedean Ammous walks readers through the fascinating history of the technologies of money and explores what gave these technologies their monetary role, how they lost it, what that teaches us about the desirable features of money, and how Bitcoin is designed to improve on these technologies. Ammous elucidates the economic, social, cultural, and political benefits of sound money over unsound money to allow for an informed discussion of the potential role Bitcoin could play in the digital economy of the future. Rather than as a currency for criminals or a cheap mass consumer payment network, this book argues Bitcoin is emerging as a decentralized, politically neutral, free–market alternative to national central banks, with potentially enormous implications for individual freedom and prosperity. For anyone looking for a clear understanding of this new digital money, The Bitcoin Standard is the essential resource.

List of Figures 5

List of Tables 6

Prologue 7

Chapter 1: Money 10

Chapter 2: Primitive Moneys 18

Chapter 3: Monetary Metals 23

Why Gold? 24

Roman Golden Age and Decline 30

Byzantium and the Bezant 32

The Renaissance 33

La Belle Époque 38

Chapter 4: Government Money 43

Monetary Nationalism and the End of the Free World 45

The Interwar Era 49

World War II and Bretton Woods 54

Government money s track record 60

Chapter 5: Digital Money 72

Bitcoin as Digital Cash 73

Supply, Value and Transactions 81

Appendix to Chapter 5 94

Chapter 6: Sound Money and Time Preference 97

Monetary Inflation 103

Saving and Capital Accumulation 112

Innovations: Zero to One vs One to Many 117

Artistic Flourishing 120

Chapter 7: Money as Capitalism s Information System 126

Capital Market Socialism 129

Business Cycles and Financial Crises 133

Sound Basis for Trade 144

Chapter 8: Sound Money and Individual Freedom 150

Should Government Manage the Money Supply? 150

Unsound Money and Perpetual War 158

Limited vs Omnipotent Government 161

The Bezzle 166

Chapter 9: What Is Bitcoin Good For? 177

Store of Value 177

Individual Sovereignty 183

International and Online Settlement 186

Global Unit of Account 191

Chapter 10: Bitcoin Questions 196

Mining and Proof–of–work 196

Out of Control: Why nobody can change Bitcoin 200

Antifragility 207

Can Bitcoin Scale? 208

Is Bitcoin For Criminals? 215

How to Kill Bitcoin: A Beginners Guide 217

Altcoins 226

Blockchain Technology 230

References 244

SAIFEDEAN AMMOUS, PHD, is a Professor of Economics at the Lebanese American University, and member of the Center on Capitalism and Society at Columbia University.