Longread: SchrĂ¶dinger’s bitcoin
When Mike Hearn buried bitcoin, its exchange rate immediately went down, as if you’re dead, you indeed should keep close to the ground. Lots of prominent cryptocurrency industry figures snapped into writing lots of texts, both long or laconic, stating that rumors about bitcoin’s death are somewhat exaggerated. Website titled â€śBitcoin Obituariesâ€ť so far contains 89 statements that bitcoin went feeding the fish, pushes up the daisies on the fields of Elysium, feasts in Valhalla with Odin, stands before Osiris, hangs out with the houris, or chats with St. Peter.
This whole thing resembles the legendary Monty Python’s dead parrot sketch in the first place. The difference is that the parrot in question, as opposed to bitcoin, is effectively and undoubtedly dead, and wouldn’t voom even if one runs 4.000 volts through it. However, one disputing party insistently argues that bitcoin has demised, while the other does its best to prove that bitcoin is not dead, it’s just resting and pining for Satoshi. What a remarkable plumage, indeed.
The very fact that the situation around demised bitcoin evokes associations with a sketch by a comic company dubbed the greatest in the history of English language, should give rise to some doubts in the head of a reasonable person. The ecosystem-departed Mike Hearn made a lot of fuss not just because he had been a prominent figure in the industry, but also because his arguments seemed convincing. However, those disagreeing with him, have their own arguments, which are as convincing as Hearn’s.
The situation’s ridiculousness is so fundamental that explaining it is possible only in equally ridiculous way. Having read several articles and arguments for both opinions, I noticed quite an interesting thing.
Let’s start with the premise that everyone should agree with: bitcoin isn’t real. It’s convenient to call it curency, but it is just several strings of code burdened with monetary functionality. Moreover, except for some funny offerings from some startups, it lacks any materiality. However, it’s quite material in terms of paying some money to obtain bitcoins that can be used for anything depending on the degree of your imagination’s recklessness. Thus, there is some duality at the very core of bitcoin as a phenomenon.
What does it mean? It means that bitcoin may be described in terms of quantum mechanics like any one-eyed electron. Electron is dual as well. It has properties of both waves and particles. It may easily get attracted to a positive charge, just like a particle, and then freak out and interfere, like a wave.
So, what happens to bitcoin in terms of quantum mechanics? It just sits in a non-transparent box with people crowded around, some of which state it is dead, while others claiming it’s alive. Both groups have their impervious arguments. However, the only way to find out what’s actually going on is to open the box to see how it’s doing. Funnily, no one ever does that.
SchrĂ¶dinger’s bitcoin is thus interesting and possible as a phenomenon only on the grounds of fundamental quantum uncertainty. If someone opens the box, all quantum probabilities will experience painful decoherence and implode to one. However, nobody needs that as lack of uncertainty may undermine the very fundamentals of bitcoin.
Uncertainty is exuberant with bitcoin. Its legendary volatility is essentially none other thing than uncertainty of its true value. Market’s reaction to Mike Hearn’s statement (the exchange rate managed to go down by almost $100 in less than a week) is the manifestation of observer effect. Heisenberg indeterminacy principle states that observing one of the object’s parameters will cause the second parameter to change, even if nobody messes with it whatsoever. Even though there were no economic rationales to bring bitcoin’s rate down, the price parameter just reacted to observation of resiliency parameter.
Bitcoin is thus, in full accordance with our dearest Erwin SchrĂ¶dinger’s legacy, both dead and alive at the same time. It is the state that makes it marketable, both as a speculation tool or a news subject. Just like the cat having turned out to be dead or alive, ceases being a symbol of a scientific paradox and becomes a sweet fluffy thing subject to care or funeral, bitcoin having turned out to be unambiguously dead or alive will lose its economic functionality and become a kind of the same cat that people should pet or bury.
There are several conclusions here. First, bitcoin will be being buried and resurrected for years. Second, its volatility is probably here to stay. And third, if you impudently use scientific terms combined with sophistry techniques, you may prove essentially anything.
by Jenny Aysgarth
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