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Translating Szabo

Translating Szabo
Written by Jon Gulson @jongulson
Posted 16 March 2018
Generation can describe either a passage or epoch of time, together with the creation and manifest of energy. In science and philosophy, these events assimilate into paradigm: a distinct set of concepts, thoughts, theories, methods, modes, postulates and standards by which we understand generation (in both energy and time).

Nick Szabo – computer scientist, legal scholar, cryptographer – is often attributed with the creation of bitcoin, probably for two reasons: firstly, Szabo is distinctive. Secondly, Satoshi Nakamoto was clearly influenced by Szabo (and in this regard, Satoshi is at least part Szabo).

Therefore by understanding Szabo, we attempt a translation of bitcoin scaling.

End of History and the Trust Premium

Those familiar with Szabo will be aware of his works and essays on smart contracts and the trust premium in value exchange, digital money (including bitgold, an unimplemented forerunner of bitcoin) and blockchains.

Bitcoin itself is therefore not just an admixture of previously isolated or unadapted technology; but rich in latency, histories and curious coincidences which provoke intense speculation around its origins and purpose.

Searching beyond Szabo can shed additional light on bitcoin’s narrative. One such illumination being Francis Fukuyama’s End of History and the Last Man published circa mid-1990s.

For Fukuyama, rational social organisation and human development through technology were discernible from the Dark Ages, to the Renaissance and the Enlightenment; but ideological narratives have played themselves out, resulting in Liberal Democracy (the final stage of Historical synthesis) and History (with a big H) ending.

In this, Fukuyama didn’t suggest time will stop; but believed in a continuation of ordinary causal events (history with a small h). Through this analysis, Fukuyama insisted on the centrality of thymos (spirit) and the need to be recognised; and megalothymia (desire for greatness) which can degenerate without trust in social institutions or from dissatisfaction with regular consumption.

Fukuyama is attributed as being the first man to predict Donald Trump’s ascendency to the US Presidency.

Dunbar Number

Just as Fukuyama recognised technological advances being discernible through human development, Szabo concludes social scability without technology is limited to 150 people – the famous Dunbar Number.

Szabo describes social scalability as customs, rules or other features which incentivise or limit multiple participants’ behaviors in a relationship or shared endeavors.
As Szabo points out here, the purpose of social scalability is something more valuable than bitcoin’s prolific resource consumption and seemingly pointless computational proof of work.

In the Nature of Scaling

This is because social scaling increases where there is a higher level of trust between participants; lowering vulnerability to harmful behavior, mitigating the worry and neurosis caused by threats of malicious actors.

Szabo and Fukuyama diverge at Szabo’s belief in such trust minimisation being achieved through blockchain software.

For example, money and markets increase in scale by incentivising the creation of accurate price signals and increased quality of information flow; by reducing negotiation costs (and therefore mental transaction costs, amongst participants). Traditionally this has required trusted third parties such as brokers, banks, agents, lawyers and regulators.

Satoshi’s breakthrough with money – or electronic cash – was to provide social scalability through trust minimal software and bitcoin has subsequently become attractive because of its integrity against inflation, forgery and theft.

Szabo attributes a citation that ‘civilisation advances by extending the number of important operations we can perform without thinking about them’. So returning to the purpose of the blog: we can begin to contemplate this new form of trust minimal money; translating bitcoin scaling by considering how the next level of our monetary systems are experienced.

The Language of Reduced Thought

The second half of Fukuyama’s title The Last Man is a direct reference to Frederick Nietzsche and Man’s desire for greatness (Superman). Fukuyama shows how megalothymia can become problematic if it feeds from narrow self-interest or the anathema of hollow consumption; manifest in rhetoric appealing to a popular belief in retrospective glories (for example, Make America Great Again).

In this light, we have previously speculated Satoshi may have been influenced by modern French philosophical thought which has a tendency to deconstruct language and the basis of consciousness. 

We can further speculate Satoshi may have had some influence from David Bohm and his work on rheomode: an attempt at understanding the quantum level of our world, for which western language is considered too static and fragmented to describe.

Or roughly translated, a micro-language which calibrates from a trust minimal software protocol for micropayments.

An ever-transformative energy unceasingly revealing, enfolding and unfolding; because a revolutionary world is irregular.

Written by Jon Gulson @jongulson
Posted 16 March 2018
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