On America’s Independence Day, it’s worth looking back at bitcoin’s history, because both origin stories share a basic impulse: freedom from a system that controls our lives without giving us any input.
That impulse led to the signing of the Declaration of Independence on July 4, 1776.
Without trying to suggest that the two are equals in historical weight or cost — no lives were lost in the fight for cryptocurrency — the Bitcoin whitepaper that launched both crypto and blockchain was in many ways a declaration of financial independence.
The push for independence is from a financial system rather than a political system, to be sure, but a financial system which, its pseudonymous founder Satoshi Nakamoto and many of his cyberpunk supporters and colleagues believed, could be just as oppressive and inescapable, and which had co-opted and corrupted the government in many of the same ways that America’s Founding Fathers felt British rule without representation had done in the 13 Colonies.
The Genesis Block Message
The clearest sign of that is the message encoded onto the Bitcoin Genesis Block that launched the blockchain on Jan. 3, 2009.
It’s a short and simple one, referring to a headline in that day’s Times of London newspaper, and it served two purposes.
Mundanely, it was a cryptographic timestamp of sorts, showing that the blockchain was launched when it said it was. That’s vital, because the timestamp attached to each block of the blockchain uses that timestamp — along with cryptography connecting it to previous and future blocks — to show its place in the chain and make it immutable. This feature means that with sufficient decentralization, it is impossible to change any data or the order of the blocks.
But more important, it was a statement of principles. The message read: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”
That referred to the massive bailout of banks happening in many countries in the wake of the subprime mortgage crisis that began in 2007, creating and then popping a real estate bubble that led to the Great Recession. Not only was it caused by blatant greed and lying about the quality of debt sold as safe, but no banker, broker or ratings firm was ever prosecuted for it.
Bitcoin was seen as a way to bypass that system — and eventually destroy it.
The first line of the Bitcoin Whitepaper describes it as follows: “A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.”
The goal was to create a “trustless” system, or one in which two parties could transact with confidence without having to trust or even know the other party, and do so without a “trusted third party” — a bank or other financial institution — between them.
“The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust,” Nakamoto wrote in a post about a month after bitcoin launched. “Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve.”
So without further ado, and with apologies to Thomas Jefferson, et. al, here is a Bitcoin Declaration of Financial Independence:
We hold these truths to be self-evident: That all consumers are created equal, that they are endowed by Satoshi Nakamoto with certain unalienable Rights, that among these are Immutability, Pseudonymity and the pursuit of Trustlessness.
— That to secure these rights, Blockchains are instituted among People, deriving their just powers from the consensus of miners,
— That whenever any Form of Financial Systems becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Financial Systems, laying their foundations on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Privacy and Financial Freedom.