[Editor’s Note: As Elon Musk tweets and Bitcoin and Dogecoin and other cryptocurrencies make headlines day after day, many wonder what is happening. Additionally, some people of faith highlight the deep value of Bitcoin, some have written books thanking God for Bitcoin, and others recoil and are suspicious of the nature of Bitcoin.
This is an opinion piece to draw together some of the frameworks that have drawn some folks to Bitcoin, and in no way does P2C-Students endorse Bitcoin. P2C-S wants to help students take their next step towards Jesus and help people see the relevance of Jesus in all of life.
Stewardship is a principle in Scripture, and this blog is meant to explore and prod thought on the role of cryptocurrency. This blog in no way constitutes financial advice—but to provide a thoughtful reflection on Bitcoin.]
By now you’ve probably heard that the crypto revolution is upon us! Perhaps you’re already deep down the “defi” rabbit hole. Or maybe you didn’t understand that sentence at all. My own journey into Bitcoin was strange. I heard about it on the news. And even when a friend recommended it to me back in 2018, I disregarded it, thinking it was some internet fad.
Last December, however, I had a paradigm shift that radically changed my perspective on Bitcoin. I’ve become what they call a “Bitcoin maximalist” as I’ve changed from thinking this is an internet fad to believing this is a technology that will change the world. For me, the penny dropped while doing something that is, as a Christian, utterly conventional: reading my Bible.
I often attempt to read through the Bible once a year. This past December, I decided to get a head start and opened the book of Genesis. While reading, I came across the story of Abraham purchasing a burial site for his late wife, Sarah, in Genesis 23. There is nothing really special about this story. However, since I had been doing some preliminary research on Bitcoin, the story struck me in a whole new way.
Here’s the story in a nutshell: Abraham was living among the Hittites, but he was from out of town and didn’t own any land. His wife, Sarah, had passed away and he had nowhere to bury her. He gathered his money and went before elders of the Hittites to purchase some land. He met them at the designated meeting place: the city gate.
Now the city gate was where kings gave decrees and where important social and business transactions took place. It’s where the elders of the city gathered to discuss policies and make government decisions. Abraham arrived there and inquired about a plot of land with a cave he could use as a grave. The property belonged to a man named Ephron. He approached the group of elders, and Ephron happened to be present. Abraham asked Ephron about the land, and perhaps as a cultural courtesy, or simply as an opening round in a typical bargaining process, Ephron offered him the land for free. Abraham insisted on paying though, and in the end, they settled on 400 silver coins in exchange for the property.
Now watch how Abraham’s purchase is verified: Genesis 23:18 says, “it [the land with the cave] was transferred to Abraham as his permanent possession in the presence of the Hittite elders at the city gate.” Did you catch that? How was the payment made valid? There was no contract written. No lawyers present. No signing on the dotted lines, and yet it was a permanent transaction. What validated the payment was that the elders of the people saw it happen.
Why is this so significant? What would have happened, if say, Ephron and Abraham just exchanged in private? If they had, it could have left them with all kinds of problems. Ephron could turn on Abraham and tell everyone that he didn’t own the property, leaving Abraham down 400 pieces of silver. Or perhaps Abraham could accuse Ephron of stealing his money. By doing the exchange before live witnesses, it means there were more people who could be called upon to verify the truth, thereby securing the deal.
Here’s another way to think of this. The elders kept a running log in their minds of all the transactions that happened among their people. Collectively, they knew who bought what and when and where they bought it. They collectively kept track of their people’s property records. Being an oral culture, this information was continually passed down to others. This meant that no certificate was necessary for Abraham. His purchase was valid because everyone saw it and remembered it. So long as at least one elder remembered, he could remind the others, jogging their memory and the truth could be determined.
Theoretically, if one or even a few elders had a grudge against Abraham, they would need to convince a majority of the other elders to change their minds so that a new false narrative could be passed on. So long as there are enough good elders who want to truthfully verify their people’s transactions, the system is secure.
What does this have to do with Bitcoin? Well, Bitcoin is fundamentally a decentralized global ledger system. Every computer that runs Bitcoin (called a “node”) keeps a record of all transactions that have ever happened within the system. This is called the blockchain. The blockchain contains the entire history of Bitcoin transactions. Nodes that track the blockchain are scattered throughout the world. You can even buy one to help run the system.
Without getting too technical, when a new transaction occurs, every node in the world adds it to the blockchain. Since there are tens of thousands of nodes running all over the world, in order to tamper with the blockchain, one would need to mount an offensive using 51% of the nodes in order to corrupt the system. However, due to Bitcoin’s incentive structure (i.e. that it’s much more profitable to work within the system to earn wealth than it is to attack it), this essentially makes Bitcoin immutable. The larger the network effect (i.e. the more “elders” or nodes operating), the more secure the system becomes.
What does all this mean? This means that Bitcoin, although only 12 years old, has roots stretching back to the time of Abraham, 4000 years ago! It is a digital version of that system. Obviously, it’s not completely the same, but the principles are strikingly similar. Seeing this caused me to look more deeply into Bitcoin. I borrowed books, looked up podcasts, and dove down the rabbit hole to learn more.
Bitcoin has become a lightning rod for criticism due to its volatile nature, its power consumption, and its libertarian bias. But the way I see it, Bitcoin is opening doors to innovation and freedom.