The Bitcoin Standard: The Decentralized Alternative to Central Banking.

• Author: Whirty, Tyler
• Position: Book review

The Bitcoin Standard: The Decentralized Alternative to Central Banking

Saifedean Ammous

Hoboken, N.J.: Wiley, 2018, 305 pp.

The "crypto world," as the budding industry based on the application of blockchain technology is often called, is a very tribal place. Perhaps the potential for vast riches in "Web 3.0" causes the splintering. Or perhaps it is an example of self-selection that first-movers in a new industry tend to be aggressive and opinionated. Either way, one need only spend a short time in the right corners of Twitter and Reddit to witness the sort of factional competition usually reserved for politics, religion, and sports.

Just as in those other contests, leaders of each crypto-tribe tend to emerge. One such faction is "Bitcoin maximalists," a term coined by Ethereum cofounder Vitalik Buterin, of which Saifedean Ammous has become a leader. He and others in this faction see Bitcoin as the only cryptocurrency with a future. In particular, Ammous expects the "Bitcoin standard" to become the new gold standard and the anchor of the international monetary system. Bitcoin maximalists thus resemble old-fashioned gold bugs in insisting that there is only one truly "sound money": alternative cryptocurrencies are to them what silver coinage was to Grover Cleveland Republicans.

In The Bitcoin Standard, Ammous presents something of a Bitcoin Maximalist Bible: a guide, from an Austrian school of economics point of view, to the historical context of the now famous white paper written by the mysterious Satoshi Nakamoto and to the economic characteristics of Bitcoin that make it so endearing to those who view it as sound money.

The Bitcoin Standard attempts to make the case that Bitcoin is a digital form of money that can provide a viable alternative to central bank fiat currencies. The first four of the book's 10 chapters explain what money is, how it has evolved over time, and how and why various monies throughout history have succeeded or failed to serve their purpose--namely, to store value and exchange it. The next three chapters dive deeper into the implications for society of sound versus unsound money as defined by Ammous. Finally, the last three chapters explain why the author considers Bitcoin "the sound money of the digital age," while addressing misconceptions and lingering questions about the still young technology

The Bitcoin Standard certainly has its virtues. To Ammous's credit, the book does a fine job describing historical...