In various lectures on the subject of Ideal Money John Nash explains that Keynesians and other notable groups have sold a false doctrine to the citizens of the world in regard to central banking. In this context he is clear to point out that Keynesians and even post-Keynesians are still in fact Keynesians (everyone laughs?!).
I hope we take moment to consider what it means for such a man to be pointing out how the entire psychology and concept of our central banking infrastructure might be seen as archaic, immoral, and outdated.
Who could so boldly claim to be thinking outside this box?
I think this provides a possibly analogy for the future of the internet poker industry.
First allow me to digress slightly. I need to pull out a certain context of the phenomenon of bitcoin in order to make a point. This point will not be received well by bitcoin enthusiasts that have an emotional connection to the movement (and price!), yet for peoples that are interested in knowledge and technological change they might someday grow an appreciation for what I will point out.
Bitcoin is in the midst of a dilemma. Early in its implementation there was a certain limit put on the production of new blocks in that they be limited to 1mb. Blocks are somewhat like pages in a ledger entry whereas the p2p nodes that create transaction entries get paid in bitcoins to validate them (in turn the nodes called “miners” sell bitcoin as a useful commodity to the markets).
The 1mb limit was said, by the (still pseudonymous!) creator Satoshi Nakamoto, to be necessary in the initial stages to secure the network from ddos attacks.
The idea is once bootstrapped the 1mb cap could be raised so that bitcoin could have more transactions/second and be scaled to rival visa and eventually become a world currency.
But there is an intrinsic problem created that most bitcoiners refuse or fail to see.
In order to change this level of the protocol there must be a consensus, not among the users for the currency, but the underlying p2p network that holds the infrastructure up. It is my opinion that not only is such a consensus difficult or impossible, but that it gets MORE difficult over time.
The relevant point here is that bitcoin might turn out to be a highly scaled money system that allows people to make day to day purchases OR it might be a high cost settlement system where such purchases are not feasible.
It seems it cannot be both, but more importantly it seems to the author that the latter is far more likely of a fate for bitcoin (regardless of how loud the masses cry!).
Poker + bitcoin = ?
Why is this relevant and significant in regard to the ipoker industry? What we should understand about bitcoin is its relation to our Keynesian banking system that wants to sell the idea to the peoples that there should be a central authority that controls the issuance of money under the guise that it should be attempting to provide a stable and healthy/growing economy via inflation control.
When these Keynesian minded banks and bankers see and hear about bitcoin they begin to try to relate it to their own perspective. And here is where the insanity and illogics begins.
Central banks are forming groups, having meetings, and buying up developers in an attempt to merge their current models with the emerging infrastructure bitcoin proposes.
If you follow this phenomenon you might hear that these banking groups are attempting projects that involve “private block-chains” (as opposed to bitcoin’s public block-chain/ledger). In other words they want the technology that is the block chain ledger system, but they do not want to use bitcoin per se.
These banks think they can somehow separate bitcoin from its usefulness, and in this they are truly only showing their lack of understanding that they have an inability to adapt and evolve fast enough to keep up with this fintech revolution.
Poker Sites Are Banks
The wealthofchips shows how games (and poker especially) have evolved in relation to the socio economic and technological reality of a given time. The ipoker industry has inherited the same intrinsic faults and problems our global financial system has. Sites function with the same detrimental Keynesian practice that our banking system uses. And so here I wish to make sure we do not fall into the same trap that the Keynesian/Central bankers fall in.
I have much to say on this subject, much has been written, but here I do have somewhat of a specific point to make. We tend to think of bitcoin as a currency and so naturally we wonder about the possibly of offering a bitcoin poker site and how that might effect the industry and or the players favourably (or possibly not favourably).
And so here I think is where we fall into a trap we probably don’t know we are stuck in. Such an application of bitcoin is not the intelligent one and in fact is quite doomed and “in the box”. It is not the proper application of the technology that bitcoin presents us.
The Power of bitcoin is it’s Censorship Resistant Network
Think of bitcoin like a hacking contest. Right now there is a 6 billion dollar wager that no one can hack bitcoin (such is bitcoin’s market cap right now). And the brilliant minds behind bitcoin expect that bet to hold true for all time. Bitcoin being run as a secure p2p network, distributed across the globe, makes it the most secure and censorship proof system known to mankind (certainly the most secure system on the planet!).
What I mean to point out is that bitcoin gives the possibility for a technology that cannot be reached by any national government jurisdiction.
Many will argue but I wish not to present my argument here, yet I mean to point out the truth of this in regard to both any government attempt to actually cause a p2p application of this kind to cease and desist but also any governments ability to simply claim jurisdiction. I don’t know if I am being clear, I simply mean: It can’t and it won’t.
Smart Contracts and Distributed Applications
Bitcoin has a manual. It has an entire explanation of how it came into existence, why it came into existence, and what it should prove to be. With this manual came an explanation on a new paradigm called “Smart Contracts“.
Smart contracts is a metaphor for a secure and robust system that executes the equivalent of a contract via bitcoin transactions. What this metaphor birthed was the possibility for a turing complete programming language that could be used to create programs and applications (one such implementation and the leading one is called “ethereum” a project captained by Vitalik Buterin and praised by Nick Szabo the inventor of Smart Contracts).
These programs and applications essentially run on top of the secure p2p network bitcoin’s solution provides. That is to say then, that bitcoin as a money system is just the first use-case for itself. We should expect ALL systems and application will be turned into distributed applications and run as smart contracts on top of a conjecturally secure layer of p2p network.
bitcoin(poker) = The Future Of Poker
Perhaps we understand what I am getting at here. P2P poker is on the very near horizon, however its a paradigm that most players and bitcoin enthusiasts cannot really properly conceive.
Many new poker sites are arising trying to compete with and take down the industry monopoly and earn a fair share of their reward for it. However I think that like the post-Keynesians these projects are all still stuck using the (very soon to be!) out dated model of centrally issued chips!