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Debasing the Currency: Putting Crypto in Context

Introducing a new series exploring the philosophical limits of cryptocurrency.

CoinDesk Insights
Jul 9, 2021 at 5:06 p.m. UTC
Updated Sep 14, 2021 at 1:23 p.m. UTC

In the fifth century B.C., Diogenes of Sinope, the son of a disreputable moneychanger, was thrown out of his hometown on charges of “defacing the currency.” He wandered west to Athens, moving from a backwater trading hub to the intellectual capital of the ancient world, on the advice of an oracle who said to continue trashing the drachma.

The Greek word for coinage, nomisma, is related to that of law or standards, nomos, the classicist Peter France noted. “So when Diogenes was told to alter the currency, he came to accept this as a divine command to change the ways people behaved,” France wrote in "Hermits: The Insights of Solitude." The plot started off reasonably enough. 

Crypto Questioned is a forum to discuss the ideas and philosophies that drive the cryptocurrency industry.

Diogenes lived an austere life – calling only a cloak, staff and empty wallet his own – demonstrating the virtue of living without wealth. He begged for bread, spilled wine, burned a lamp during the day, wandered the countryside barefoot and lived rent free in a bucket. He confronted people with the idea that their money was mispriced or their values misaligned. Why would a statue cost more than a quart of barley? Why are worthless goods bartered for the better? 

Diogenes and Alexander the Great

When a coin is defaced, it’s removed from circulation. The same can’t necessarily be said for customs or traditions, try as Diogenes might. But his acts of defiance may have got people thinking. In fact, he spurred an entire school of thought called cynicism, which aimed to square human nature with nature itself. 

The same might be true of the cryptocurrency movement. It’s sometimes said that Bitcoin doesn’t provide all the answers, but it is getting people to ask the right questions. This 12-year-old experiment in monetary openness, independence and restraint is a foil to a global economic system that gives special interests advantages over sovereign decision-making. If bitcoin exists, why the alternative? 

Diogenes was more than an eccentric tramp, he was an affront to the ruling elites of the day. He attended an archery competition and sat next to the target, saying that’s where he felt safest. After Plato said Man was a “featherless biped,” Diogenes gatecrashed the Academy with a plucked chicken. Alexander the Great once offered him anything in the kingdom; Diogenes asked for the monarch to step out of his light while he tanned. 

Fighting an uphill battle against all the trappings of wealth, fame and power, the cynic had a few tools at his disposal: a commitment to frank speech (parrhesia), a total shamelessness (anaideia) and complete disregard for convention (apatheia). The first “cosmopolitan,” or citizen of the world, Diogenes was committed to exposing the truth, wherever it lay, even (or especially) if it was heretical. 

Crypto is not cynicism, but the two movements share some common means and ends. Namely, to expose the fraudulence of the current regime simply by existing. A global, multivariate universe of people, ideas and protocols, crypto is often contradictory more than it is correct, in conflict more than it is cohesive, but there are a few underlying values.

There’s the commitment to disintermediation, to open access – for speech and finance – and the sovereign individual. In debasing fiat, crypto has implications for the whole social, cultural and political order (most of which have yet to be understood). Crypto can be funny, fascinating and downright strange, but it’s also a philosophical puzzle. It’s a new lens to think about knowledge, justice and love. 

Are blockchains truth machines? Is code superior to law? Can you fall for an avatar in the metaverse?

In a new series, "Crypto Questioned," CoinDesk is inviting some of the industry’s most interesting thinkers and builders working through the dilemmas crypto presents. We invite you to participate

It’s said Diogenes passed away in old age, after spending the last years of his life as a slave and tutor to a wealthy Corinthian family. The city erected a statue to him and buried him in honor next to the city gate. It’s an ironic end, and one that might only have happened in ancient Greece: A society that honored the debasement of its currency. What treasures lie ready for us today?

Crypto Questioned is a forum to discuss the ideas and philosophies that drive the cryptocurrency industry.

DISCLOSURE

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

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