The military, today, is not considered an important element of society by the public. Why should it? It represents bloodshed and fights that seem pointless and have caused society a lot of pain. Similarly, studying Bitcoin as a property defense system is a misunderstood part of this asset and one that is biased by our own beliefs. How are they connected? Because both use brute force and physical power to defend property.
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As a Mexican-born citizen, I have always wondered why, given the abundance of natural resources like oil and lithium available in our country, Mexico hasn’t become a world economic leader. You might also have a similar point of view in your country of residence. Especially if you are in a developing nation in Latin America or Africa or if you live in a small country that has a lot of influence from superpowers like Russia, the U.S. or China.
Throughout history, one of the reasons a country or empire has become a hegemonic power has been through what Jason Lowery calls the power projection game, which means the kinetic brute physical force of the military. This is important because if a nation doesn’t project power properly, how can it defend its natural resources and its sovereignty from another nation? And more importantly, as individuals, how can we defend our property from being stolen or confiscated by a corrupt agent? Here is where the role of The State arises.
According to Robert Breedlove, the main purpose of a State is the defense and preservation of life, liberty, and property.
If property means a list of “Who owns what?” and life is the source of all rights, then how can we defend ourselves from a tyrant or a person that wants to steal our property? We want to be assured that the product of our daily life efforts gained through sweat, tears and sacrificed time will be safe for ourselves and our bloodline.
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For centuries, this authority has been the government. The government is the entity that determines the rule of law in a community. It works through the federal courts and its three main powers — legislative, judicial and executive — to defend the property rights of its citizens. It needs the third one — an army — to guarantee compliance with these rules if the other powers fail in doing so.
When we look at history, the government has often ended up being the actor imposing new rules and thereby violating these same property rights. In the U.S. this right is protected from corruption by the Second Amendment, which allows the people to form militias to combat the government if it becomes a bad actor in society.
This concerns the protection of property rights within a self-organized state, but the same dynamics are true between states. And this is where international conflicts come from and where the importance of the military arises to defend their rule of law from outsiders.
Military development infrastructure.
Carl von Clausewitz, a Prussian general and military theorist of the 19th century stated: “War is merely the continuation of policy with other means.” So to understand the importance of the military having a hegemony we need to understand why wars happen.
As one of the most important classical strategic thinkers of history, he examined the nature of war and defined it with this trinity:
War is made of the same “blind natural forces” of “primordial violence” observed in nature.
It contains “the play of chance and probability” that rewards “creative spirits.”
It is a calculated instrument of national policy used to solve political disputes.
This means that the survival of the fittest, the creative spirits that are in the search beyond something greater than them and with a clear purpose to achieve it, are the ones that translated into governments and have become the superpowers that are influencing everything around them because they have become the best at projecting power.
This is the judge in the rise and fall of civilizations and superpowers. And when new technology arises, the hegemony of the power that rejects it suffers the consequences and falls apart.
Think of the Middle Ages, and one of the first things that probably leaps to mind for us is castles. Those immense, strongly fortified structures that were the power bases of their day. Gunpowder would change all of that, as the shattering of the walls of Constantinople demonstrated.
Picture yourself in Constantinople, which was seen at the time as the ultimate metropolis, the ultimate object of desire; and the Ottoman Turks were determined to capture it. It is the year 1452. Orban the engineer, an artillery expert, is working in Constantinople and goes to Emperor Constantine XI and his armies to offer them his newest invention; a dreaded weapon, a monster cannon using gunpowder to protect the city from outside invaders. But the Emperor ran out of money and couldn’t buy it from him. So Orban goes to the Turks, who couldn’t realistically reject it, and, at a better price, offers it to them.
Jumping ahead, it is now Easter Monday, April 2, 1453, a year later. The young Ottoman sultan, Mehmet II, and his armies are in Constantinople to begin the siege of the city. The monstrous cannon, constructed by Orban the engineer, had to be hauled more than a hundred miles to the besieged city. The largest cannon ever, 27 feet long with the ability to shoot a 1,500-pound stone ball at the defenses of the beleaguered city, is now in position. With deafening thunder, the cannon fired. This weapon pounded the walls of Constantinople and eventually broke them down, allowing the Ottoman army to breach the city.
In addition to this monster, many other smaller cannons continued the bombardment. This was the sound of a military revolution, making stone walls, towers and battlements largely obsolete. It would devastate the certainties, traditions and way of life of the medieval age.
The city of Constantinople fell on May 29, 1453, eight weeks after the first siege. And the key to the Ottoman Turks conquering Constantinople was the cannon constructed by Orban the engineer, a professional artillery master.
Those last words would have been a lie because they couldn’t defend themselves from the cannons unless they would have bought them the year prior to the siege. This is an important history lesson because the last innovation in power projection was nuclear weapons. We saw what they are capable of in Hiroshima and Nagasaki. If used, the outcome is mutually assured destruction of humanity. And the countries that have them became the new world superpowers that no one wants to attack because the cost of it may be irreparable. These countries are China, Russia and the world superpower hegemon, the U.S.. We have some other exceptions with nuclear weapons like North Korea, but they don’t have the influence of these three countries throughout the world.
Yet, another power projection technology arrived in 2009. Satoshi Nakamoto, inspired by Adam Back’s paper “Hashcash – A Denial Of Service Countermeasure”, built “Bitcoin: A peer-to-peer electronic cash system,” A network with a cost function that brings a challenge to its miners to be able to create tokens we call satoshis. By the proof-of-work mechanism, miners have to solve a challenge every 10 minutes to be able to validate Bitcoin transactions, and by doing so they receive bitcoin as a reward. Miners need to connect their specialized computers like Antminer’s S19 Pro in order to generate valid blocks.
This cost function has also a mathematical succession to impose a cost if someone wants to attack the network:
The Bitcoin halving formula.
When the Bitcoin network was released, miners started receiving 50 bitcoin per block, which was mined every 10 minutes. Every 210,000 blocks bitcoin rewards will be cut in half, which happens approximately every four years until we reach 32 halvings (”halving” is the term referring to the Bitcoin rewards cut by half), which is expected to happen in the year 2140. We are now in the third halving, during which miners are receiving 6.25 bitcoin per block.
If someone wants to attack the Bitcoin network, he or she would need to have a 51% majority of the hash rate. If, despite major roadblocks preventing such an event, a person does have this majority, the Bitcoin full nodes around the world would then have to validate and accept these new attacker blocks, which they are not incentivized to do so. Not to mention, this 51% attempt to attack the Bitcoin network would take approximately $6.7 billion per year.
The proof-of-work mechanism imposes a physical cost to any belligerent agent that wants to corrupt the network. Using electrical power via their computers, they are using electrical brute force physical power instead of kinetic one like the military’s gunpowder. This is a continuation of the power projection game but in cyberspace, now done by protecting our purely digital property and energy, which we call Bitcoin. Miners are a continuation of our military power.
What are the implications of this? Jason Lowery expresses it as follows and is making a great thesis called “Softwar: Bitcoin And The Future Of Our National Strategic Defense.”
Lowery illustrates here:
The U.S. has become the world superpower through its military force and the use of its currency, the U.S. dollar, as the world reserve money in the world. They managed to secure this after getting out of the gold standard in 1971 and following that with the petrodollar system.
Why is this important?
“Can I trust my savings in the banking system?
If I go against the U.S., could I be thrown out of the SWIFT system as well?
How can we protect our property and sovereignty from the influence of this superpower?”
They do so by building their military kinetically and electrically so that they can impose a cost on any attacker that wants to inflict their rules.
The power projection game is a natural law that has existed for millions of years and is now evolving. Now, the U.S. has to make a smart move if it wants to maintain its role as the most powerful nation in the world.
Jaime Gutierrez is a Bitcoin and Financial Strategist and Founder of Bitcoin Embassy on Youtube. He translated The Great Reset and the Rise of Bitcoin from Pierre Corbin to Spanish and is working as an active researcher in The Great Reset and the Fight for the US Dollar. This article was originally published on the Bitcoin Magazine.