Contra Buterin on Pro-Crypto Voting
When single issue voting can make sense
Disclaimer: This post uses cryptocurrencies as an example but this type of thinking can be applied to all potentially revolutionary technologies. Nothing I discuss in this post is intended to support any particular candidate/party in any election anywhere.
Against choosing your political allegiances based on who is "pro-crypto" (eth.limo)
In a recent opinion piece by Vitalik Buterin on his blog (linked above), he argues that people should not choose their political allegiance based on who is "pro-crypto" which he seems to be defining as having made strong verbal commitments to allowing people to trade cryptocurrencies (what he calls “trading coins”). At the risk of putting words in Buterin's mouth, he seems to be saying that a more holistic view of an entire political platforms approach towards a policy area needs to be considered rather than focusing on a single-issue. The paragraph below captures the questions Buterin thinks you should be asking before supporting a political candidate for reasons related to crypto:
If a politician is pro-crypto, the key question to ask is: are they in it for the right reasons? Do they have a vision of how technology and politics and the economy should go in the 21st century that aligns with yours? Do they have a good positive vision, that goes beyond near-term concerns like "smash the bad other tribe"? If they do, then great: you should support them, and make clear that that's why you are supporting them. If not, then either stay out entirely, or find better forces to align with.
<https://vitalik.eth.limo/general/2024/07/17/procrypto.html>
While these are all reasonable and important questions to ask, I think this framing is only one of many and am going to make the case that this is not the “key question” anyone should be asking when considering voting for or against (potentially) revolutionary technology of any type.
Depending on your view of crypto, what it is, and what potential impact it could have; it can be completely rational and reasonable to be a single-issue crypto voter. Or a single-issue voter on any particular issue so long as the voter believes they are accurately assessing the importance of the single-issue on creating the long-term political equilibrium they hope to achieve.
The foundational premise I base the above statement on is the following: human societies and their structure are downstream reflections of the technology (both social and material) that those human societies have access to.
Due to the outsized impact of technology on the structure of human societies and the civilisations that emerge from them, it can make sense to be a "single-issue voter" if you believe that the impact of a technology will have a disproportionately large impact on the shape of a future society. This is a relevant point not just for crypto but also for many technologies either growing or enjoying renewed interest in the world today (AI, robotics, nuclear weapons, nuclear power, etc).
To demonstrate what I mean by this, let's imagine we live in the year 1300 in feudal Europe. Societies are structured to be ruled by lords and royalty on top with a vast quantity of peasantry beneath them in both economic and social status. In history as it occurred in this period the peasantry could not vote, but let’s pretend they could for this hypothetical. An election is being held over who will rule the kingdom and two aspiring lords put themselves to the vote and offer their programs to secure your vote:
Lord 1 is concerned about the welfare of the peasantry and wants to improve their living standards. He has repeatedly expressed views aligning with the general idea of noblesse oblige towards the peasantry and believes strongly he has a duty towards them. He has also said he desires to make moves to give the peasants more of a say in the running of the kingdom. To this end he promises the peasantry he will keep more of their harvest (less taxes), they will be consulted on any intent to move them from their lands, a monthly entertainment or circus of some kind will be provided, and a consulting body will be setup to give them a voice in the court of the lord.
Lord 2 is a harsh man and perfectly content with how the feudal system operates. He will not offer any concessions to the peasantry beyond what he has already as he has fulfilled his role as lord and he sees no need to. However, Lord 2 is concerned about a potential threat from a powerful kingdom close to his realm and so will insist that all peasant household leaders be issued a new piece of weaponry called a "musket" that will be used to defend the kingdom as demanded by the lord.
On the surface it might make sense to argue that lord 1 offers a better deal for the peasants. Lord 1 is offering all sorts of social benefits to the peasantry while Lord 2 is offering nothing and even demanding further service from the peasantry.
However, a foundational pillar of the feudal system was the combination of heavily armoured knights and extremely defensible castle structures. They played an outsize role in maintaining feudal societal structure and the dominance of a small class of nobles over a much larger number of peasantry. The spread of gunpowder weaponry and cannons rendered both knights and castles much less effective tools for asserting and maintaining power, and so played an outsized role in the end of the feudal system.
So, if you were a far-thinking peasant who believed the feudal structure was inherently exploitive and wanted the demise of the feudal structure altogether, it would make sense for you to be a single-issue voter on encouraging the spread of gunpowder weaponry as it will be the key to undermining the technological structures that underpin the feudal system. The undermining of the feudal structure may not lead to an improvement of the lot of the peasantry in the short-term but if the goal is primarily to shift the overall societal structure, lord 2 is the better choice.
I'm sure at this point the relevance of this example to cryptocurrency is clear. As it once was with gunpowder weaponry to the feudal system, so it might be with cryptocurrency and the fiat monetary system.
Whether or not crypto can live up to the loftiest predictions that some proponents have for it is unknown. We are in entirely uncharted waters with cryptocurrencies and it is unclear where and how this all evolves. The world could end up with any combination of different currencies both fiat and crypto and many different outcomes could emerge. Crypto may end up having an extremely marginal impact on the world's economies or an epoch-redefining one.
That is why I have to object to a framing from Buterin in another of his paragraphs (quoted in full but the part of interest is the final line - bolding is mine):
The game of politics is much more complicated than just "who wins the next election", and there are a lot of levers that your words and actions affect. In particular, by publicly giving the impression that you support "pro-crypto" candidates just because they are "pro-crypto", you are helping to create an incentive gradient where politicians come to understand that all they need to get your support is to support "crypto". It doesn't matter if they also support banning encrypted messaging, if they are a power-seeking narcissist, or if they push for bills that make it even harder for your Chinese or Indian friend to attend the next crypto conference - all that politicians have to do is make sure it's easy for you to trade coins.
From <https://vitalik.eth.limo/general/2024/07/17/procrypto.html
What is called here “trading coins” is a deceptively important part of the effective functioning of the economy. It can be easy to not be aware of this when living in countries with relatively competent monetary policy and free markets, but in many parts of the world being unable to “trade coins” (or change currencies) causes significant issues. For instance, capital controls in places like China are a major reason for a recent housing bubble. And the lack of ability of Argentinians, Nigerians, and many others around the world to change out of their local currency has negative consequences for both them and their nations economies. If cryptocurrency is to succeed in improving the world in any timely manner, the ability to “trade coins” or rather change currencies is absolutely crucial as it will allow the market to see the relative value of different currencies overtime.
It is hard to overstate the impact control of currency provides governments around the world or the overall importance of money to the operation of our economic system. If an economic system were a body, then money would be the blood. Nothing works without its flows and how it flows impacts everything. Whether it is the fixed/floating exchange rates nations use for economic purposes, financial sanctions used to stop certain parties from engaging in trade, the ability to fund deficit spending by governments by adding to a nation’s debt, asset bubbles of varying types as more money chases fixed assets, money is at the centre of it all.
Although cryptocurrency has evolved beyond its initial foundation as a form of money, the core functionality as laid out in the Bitcoin Whitepaper was for P2P cash for the world. For digital money bound by different rules to what has ever come before it. And I believe cryptocurrencies in competition with fiat currencies will still be by far the most impactful technology to come out of the cryptocurrency/web3 revolution. The ability to continue “Trading Coins” is not an afterthought for crypto it is perhaps the core, most important, functionality the technology must retain in order to have an impact in and on the world.
To quote Will Durant from "The Lesson of History":
History reports that the men who can manage men manage the men who can manage only things, and the men who can manage money manage all.