“When your actions describe a system of evil consequences, you should be judged by those consequences and not by your explanations.”
Frank Herbert

Children of Dune

Armies as Market Makers


In Debt: The First 5000 Years David Graeber highlights a recurring historical pattern that emerged in different cultures around the world: armies as market-makers. When  a conquering army is sent out it needs a lot of supplies to keep it going. Instead of having to provide supplies kings / emperors / what-nots would 1) pay the soldiers with coins; 2) require peasants (food suppliers) to pay taxes using only those coins; 3) which would force the peasants to provide supplies to soldiers who would pay with said coin which could then be used to pay taxes. As a result, successful conquering armies were correlated with control of mines which would provide the metals needed to press coins.

Then it includes this quote from Kautilya‘s Arthashastra (over 2000 years old):

“The treasury is based upon mining, the army upon the treasury; he who army and treasury may conquer the whole wide earth”

That neatly summed up why I feel Bitcoin is a failed currency from its inception. Bitcoin is a highly centralized system where the kings are engineers. It is bound to become more centralized as mediators such as online-exchanges make the technology available compete for added-value market share.

But more then than, I feel that the most challenging aspect of currency (mainstream or alternative) is the question of backing. I feel it is the most neglected aspect of innovative new currencies. What backs a currency? Time-banking exemplified a good answer (hours of work can be exchanged) but limited in its application because it tramples value (not all hours are equal).


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