The Satoshi Revolution: A Revolution of Rising Expectations
Section 3: Decentralization
Chapter 8, Part 4
Crypto and the Impossibility of Knowledge in Planning
Bitcoin…is better understood using the conceptual lens of the Catallaxy: participants in Bitcoin spontaneously form a decentralized monetary and financial ecosystem, collectively choosing Bitcoin as a medium of exchange and store of value. Bitcoin is…an irrefutable demonstration of spontaneous order in action.
Cryptocurrency is a perfect example of catallaxy and of a remedy for its polar opposite: central planning. The opposites are at war, of course.
The concept of “catallaxy” is similar to that of “spontaneous order,” but the latter concept can be broadly applied to most areas of life. Catallaxy applies specifically to how economic order emerges in a system through the uncoordinated and diverse actions of individuals who pursue their own self-interests. The social theorist Friedrich Hayek defined it as “the order brought about by the mutual adjustment of many individual economies in a market”.
The obscure term captures a dynamic that is essential to the creation of civilization: cooperation. If human beings are to rise above the level of Robinson Crusoe or savagery, then they must interact to mutual advantage. Historically, the “cooperation” is usually orchestrated by a central authority-a government, a tribal leader, a religion-that negates the voice of the individual. One reason people agree to be silenced is because they worship the authority, which makes them willingly or unthinkingly sabotage their individualism.
And yet, human beings are conflicted. Most hope to be the type of person who would stand between a lynch mob and the black man it is hunting. There is a yearning to be heroic and unique, even if it is expressed by standing in a
