Humanity’s pioneering of the world didn’t end after discovering the entirety of the Earth. Once we left our touch on every corner of the planet, we moved outward to the stars. And today, we’re now moving inward. Cyberspace is the world of our minds, and with every advancement in technology, we’re developing new ways to explore it and bring it to life.
As is the case with the founding of many new countries, national currencies emerge from them as society organizes itself economically and politically. Money makes the world go ‘round as they say, and in the digital world, bitcoin is becoming a nation state of its own.
Framing Bitcoin As A Nation State
No single analogy fully does bitcoin justice. There are always nuances that set it apart from anything that humanity has interacted with. People often compare bitcoin to gold, but what about comparing it to other countries?
If bitcoin behaves in a similar fashion to the countries of this world, then what are the components of a nation state that bitcoin tends to replicate?
You can break a nation down into these six critical components:
- Its discovery
- Its territory
- Its population
- Its government
- Its culture
1. Discovery
The first aspect that every new nation throughout history shares in common is its discovery. Someone had to stumble upon the land and claim it as their own. Throughout history, however, pretty much any new nation that arose brought violence with it. History is a tale of civilizations conquering one another, a story no different than today’s.
Bitcoin, however, arrived entirely peacefully. Satoshi Nakamoto happened to put the conditions together necessary to “unlock” bitcoin from the internet. While on one hand you can consider bitcoin an invention, in reality it is closer to a discovery. Just as Einstein discovered the equation behind the theory of special relativity, Satoshi Nakamoto discovered the equation of bitcoin.
Unlike the theory of special relativity, however, bitcoin is a tangible good we can acquire and interact with.
2. Territory
Once you’ve discovered a new nation state, it needs defined territories for others to understand its boundaries.
If you look at any country on a map right now, you can see a clear outline marking its territory. Once you cross those boundaries in the real world, you enter into the nation/or exit into a neighboring one.
Rather than being placed in the physical space, however, bitcoin is defined by the confines of cyberspace. Given there are no physical limitations to cyberspace beyond the receptivity of devices that can interact with it, bitcoin is a nation that could theoretically stretch beyond Earth and onto other planets, given the right infrastructure in place for nodes and devices to sync up between planets.
Bitcoin’s territory is infinitely scalable and can accommodate an infinite amount of people, without having to worry about housing or other accommodations.
3. Population
Bitcoin’s population is rapidly growing, faster than the rate of early internet adoption.
In comparison to other physical nation states, it’s not even close. Take a look at the world’s overall population growth throughout the past two millennia:
Bitcoin adoption is on a similar trajectory. While it has yet to spread to all eight billion people on this planet, the adoption rails are already in place thanks to technology that bitcoin was built on, like the internet, which already has a nearly 70% penetration rate worldwide.
As internet adoption grows, so does Bitcoin adoption. As bitcoin adoption grows, so too does the amount of businesses and individuals accepting bitcoin as payment worldwide. Extrapolate this trend long enough, and eventually no one wants fiat currencies any longer, as their value rapidly decays towards zero indefinitely. On the other hand, bitcoin becomes widespread enough that the global economy can support Bitcoin-denominated trade. Just as no one will step in to sell bitcoin and buy up fiat from other people, no one will offer to sell their bitcoin in exchange for fiat. The buyers of last resort for fiat currencies are their governments, but even governments have been hedging against themselves as they wake up to this reality.
This trend is what global adoption of a new currency looks like. It’s not pretty, fair, or accommodating to those who ignore the trend. Just like the internet, the people who fail to adopt and adapt get washed out.
History is not kind to laggards, typically speaking. The population residing in bitcoin today are the early adopters. Consider becoming one yourself.
4. Government
Now how do you manage the ever-growing population of a brand new nation state?
While most national governments abide by a federalized code of law that’s written, re-written, and swapped out routinely by legislators, Satoshi implemented a consensus mechanism known as “Proof of Work” to enforce the rules of the network. Rather than relying on fallible, fickle humans with inherent bias towards themselves to manage policy that changes depending on the administration in charge, bitcoin’s code is an infallible set of laws that are unchanging no matter who joins the network. Instead of centralized leadership determining what’s best for the network, the decentralized majority of the network must come to consensus over changes to the network. This design is critical to uphold certain rules that should never be changed, like a fixed supply of 21 million, but offers enough flexibility to make adaptations that help to improve aspects of the network, like Taproot or SegWit. This way, bitcoiners can be sure that the foundational elements of the network never change, and that new updates to the ruleset only come by the approval of the majority.
If Satoshi’s consensus mechanism were to be a written legislative document, it would behave similarly to the US Constitution. The Constitution’s authority rests outside of the government’s, which historically created the necessary conditions for the United States to become the most free and flourishing country in the world. However today, even the Constitution is facing contention from authoritarians looking to overthrow it. You can burn paper documents, but you can’t burn code.
5. Culture
Countries create national identity through the standards that their governments impose on its people. It’s why you see the United States breed an eclectic, diverse culture of multi-culture, made up of people coming from all parts of the globe. Whereas a country like Japan places great importance on courtesy, cleanliness, and order. The parts of the world where you don’t find much culture at all are the ones struggling to get off the ground due to entirely broken legal structure. Where there are no guidelines to work within, it becomes difficult to create any identity at all.
Unfortunately, national culture inevitably breaks down over time. State-imposed trust can only last for so long before greed, pride, and thirst for power takes over. The human condition.
“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve.”
– Satoshi Nakamoto
Like any nation, bitcoin fosters its own cultural identity, founded on core principles of freedom, individuality, privacy, and autonomy. It’s a thermodynamically sound system that respects the conservation of energy, unlike inflationary monetary policy.
Satoshi understood that stripping the individual of personal autonomy inherently limits people and degrades trust in society over time. Ironically, if a nation wants to preserve trust among its people, it starts with a trustless foundation that everyone accepts without personal or political biases.
The culture of the Bitcoin nation state is unique in that there is no risk of human bias. The rules were set in code, unchanging and eternal. It’s a set of rules outside of human imposition, making them ideal for building a culture that can last, and sets the tone for everything else that comes out of it. Just as we see the fiat standard inherently breed distrust and division between people, nations, and their governments, on a Bitcoin standard, we can expect the world and its systems to gravitate towards freedom and individual autonomy.
The Bitcoin Network Vs. Physical Nation States
So based on these characteristics, it’s clear that the Bitcoin network operates similarly to any other nation state.
A lone computer engineer stumbled upon bitcoin after a deep dive into the unknowns of the online landscape, building on past innovations to discover something entirely new. Bitcoin has its own unique territory and an army of miners defending it around the globe. Bitcoin fosters its own culture through the foundational attributes of freedom and individuality that it was founded on. The Bitcoin population is growing rapidly as more and more people are forced into refuge by an oppressive fiat regime.
The primary difference between bitcoin and other nation states is that the land of bitcoin is not physical. But despite its presence only in the digital domain, the inherently advantageous network effects that bitcoin enjoys means that it can gain outsized geopolitical influence in the world. With a nation of people being empowered to abide by a different monetary policy, it forces the hands of physical governments to compete and offer incentives to keep people within their monetary jurisdiction. But as their currencies continue to dwindle, those incentives are becoming harder and harder for people to desire.
How To Immigrate To The Bitcoin Nation State
One of the quintessential perks of the Bitcoin nation is that it’s permissionless; There’s no need for green cards, Visas, or other forms of personal identification in order to join.
Bitcoin allows anyone with a wallet address to receive, store, send, and spend bitcoin as they would any other currency, without the overhead risk of evaporating purchasing power over time, since no government, central bank, or other national entity is quietly diluting the supply of bitcoin over time.
If you want to join the Bitcoin nation state, it only takes four simple steps (and is much less complicated than migrating to an actual country, we promise):
- Acquire a hardware wallet from a reputable vendor and set up according to its instructions.
- Sign up with a trusted centralized exchange like Swan (affiliate) or learn how to use RoboSats for non-KYC purchases.
- Buy bitcoin on the platform of your choosing.
- Withdraw the bitcoin to cold storage by copying and pasting the address provided by your hardware wallet.
Once you’ve moved your bitcoin to cold storage, you officially have taken self custody of your bitcoin, and are a citizen of the Bitcoin nation state. Now, you have the freedom to interact with the global network of refugees who’ve also fled from fiat oppression. In this nation, no one is able to coerce or manipulate the supply of your currency. The cost of living in this nation state decreases over time.
Of course, not everyone is able to go all in on bitcoin at a moment’s notice. Most of us still have our hands tied in the fiat world to some extent with our bills, salaries, and other financial commitments. But the more that you park your money, your flag, your stake in the Bitcoin nation state, the more you reap the benefits of it.
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