Bitcoin is The Spread Offense of The Monetary System
The battle of Bitcoin over Fiat isn’t too dissimilar to annual Conference Realignment battles.
When it comes to finance the world revolves around the desires and demands of corporate entities, Hedge Funds, Investment Banks, and Nation State actors.
There is an invisible hand in our global economy. It is one that directs the flow of capital around the financial system, but it’s not the one that Adam Smith wrote about in the 1700s in The Wealth of Nations or The Theory of Moral Sentiments.
The Invisible Hand is on The Move Once Again
Global financial players are jockeying for positions in a new digitally native financial order. Bitcoin is here to stay and it’s here to equalize the lack of balance of power that currently exists.
As with any design change, there will be winners, losers, and everything in between. My goal is here is to convey my view on the topic in such a way that individuals can relate something they don’t know all that well (the monetary system) to something they are likely more comfortable with (college football landscape). I aim to explain how the shift in our monetary system is not all that different from the rise of sweeping change across the system of College Football over the last decade.
Pools of capital are interesting. They create great wealth and can be used for good things. If you follow the capital, you more often than not find the real problem.
Ultimately, it seems that human greed tends to win out. Thus, there’s a repeating process of building that later leads to demise. It happens over long periods of time and it seemingly happens across various landscapes. The one common theme is large sums of money and a thirst for power or control. To define what money is, is a bit too deep for this article but if you’re interested you can find more on that here.
In my mind, the state of disarray and arguing over money, in college football and conference realignment more specifically, is not all that different than the struggles between countries and currencies within our monetary system.
The battle between Nation States jockeying for the global reins of power and the battle of Bitcoin over Fiat isn’t too dissimilar from the annual Conference Realignment battles and the power struggle between Power 5 and Non-Power 5 schools. These battles are based on, “Who gets to control the keys to the financial kingdom?”.
By design, systems start as mechanisms that work for the greater good, but as the capital grows and money starts to slush around, greed seeps in. It never fails. If you follow the money trail, you’ll find exponential growth and you can sit back and wait for the bickering to start. It’s George Soros’ theory of reflexivity. It takes time to unfold but the feedback look is repetitive and circular in nature regardless of the system.
Throughout history, there have been many periods of growth and unwind. It’s hard to sit here today, gazing out across the landscape and not see the unhinging taking place. That doesn’t exactly mean that we are in for doom and gloom, but it does mean a transition is upon us. For more on the cyclical nature of this, dive into The Fourth Turning, The Bible, or The Sovereign Individual. All great resources to better understand how cyclical human behavior is across space and time.
Bitcoin is the Spread Offense
For the past two decades, the system of college football has grown exponentially in size and profit. Conferences have been formed and realigned many times over. Teams are on the move, coaches are paid handsomely, players have been oppressed financially, and schools have been privy to massive windfalls of money and financial gain. All on the backs of the athletes. Without players on the field on Saturday, there are no games and no schools raking in $100+ million dollars annually, but that’s another topic.
In this system, historically, the Power 5 has blocked the Non-Power 5 (small schools) from most of the access to the revenue generated within the larger system. So, to compete and capture some of the profit coaches at smaller schools developed and designed the spread offense. The Spread is the great equalizer to better talent and financial resources for recruiting. The introduction and use of the Spread Offense over the last 15 years has truly changed the landscape of college football on the playing field. It is now not all that uncommon for a small underdog to go toe-to-toe with or beat the giants of the Power 5.
This dynamic is not all that dissimilar to the power and opportunity that Bitcoin brings to the table for individuals or smaller Nation States that have historically been held in check by the greater Fiat system which plays well for the G20 and not so well for everyone else. Post 1940’s and for the following 6 decades, the system in place seemed to work for most and worked extremely well for a few. But at the turn of the Century cracks began to show and in the last decade, it has become increasingly transparent that a new rule set is needed to maintain order.
Bitcoin offers many opportunities for all countries to have a seat at the table. It offers all countries the ability to compete, just as the Spread offered opportunities for the smaller schools to partake in the greater revenue available to the system without being held in check by a few. As we’ve seen in College Football the chairs of power have shifted, the design of flawed systems have been reorchestrated… over time.
It’s still not perfect but the spread called out the elephant in the room just as Bitcoin has done within the global financial system. The global battle for power is now beginning to shift in ways that it has not since WWII.
In my opinion, we can expect the story to unfold in much the same way. Existing power brokers will do their best to capture as much of the new piece of the pie as possible. Progress will be slow but change is inevitable as the smaller parties can no longer be locked out because they now have other financial options. Oppression by financial means is the only true way to control and Bitcoin offers a solution to this.
It provides the options and tools to build your perceptions into reality. It makes everything on the table there for the taking, if you desire to build it. As two worlds collide, large and small, new ways will be concocted until we arrive at the same point again some time off into the future. Even though Bitcoin offers better utility and financial freedom and the Spread offers a seat at the financial table for smaller schools there will be new pools of capital that begin to grow again. We’re in the early stages of a pattern that has repeated for as long as humans have inhabited the earth.
The exponential growth that follows the redesign or shifting of capital will naturally attract the normal greed that brings us back to square one eventually. This is how we’ve progressed from the Stone Age to now and one can only assume we’ll continue to progress in a similar fashion into the future.