Ok I have just started working at Manchester actually. So there is no detail on my profile yet


http://www.mbs.ac.uk/research/people/profiles/SDallyn

I don't use linked in but I am on academia.edu, you have to sign in for this but I prefer it because it means that I can upload any papers so they are free to access for anyone that might be interested:


https://independent.academia.edu/SamDallyn

That should give you a strong flavour of my previous work which was actually more in the area of political theory. I don't particularly want to bore everyone with a copy of my cv - which details my previous teaching experience and funding awards - but if anyone who is considering whether to participate in the survey would like to read my cv (it runs to about 7 pages) I can send it to them via the Bitcoin Forum email.

I am struggling to know exactly what you mean by credentials. I'm a lecturer in Manchester Business School with an interest in political economy and Bitcoin. I completed my PhD at the University of Essex a couple of years ago, so I'm in the early stages of my academic career.... I suppose it tends to be younger academics that are interested in Bitcoin, perhaps because they are less tied to orthodox assumptions about what money is.

If you would like to know about my previous work I can send you this further information via email but its not really relevant to this research project.

Still your participation would be much appreciated

Hello all,

My apologies if this topic thread is not strongly relevant to the technical aspects of Bitcoin and its development however I would like to get a broader range of participants in a survey I am conducting and this appears to be the most posted topic on the Forum.

I am a researcher at the University of Manchester in the UK and I have a long standing interest in Bitcoin, as well as owning some of the currency. There remains lots of further research to be undertaken into Bitcoin from different angles and I have a particular interest in the political challenge to the existing money system that is posed by the emergence of alternative virtual currencies.

Just to give some background to my research, I have read a large number of sceptical pieces about Bitcoin from economists in a range of blogs and newspaper articles, but there has been very little work I have seen that examines those that own Bitcoin and their reasons and motivations. It strikes me that this is a major gap in the literature since we can only understand Bitcoin's future as a currency and an asset by understanding the motivations of the community around Bitcoin. For these reasons I would like to undertake a survey of members of the Bitcoin Forum with as broad a range of participants as possible, I am aiming for roughly between fifty and a hundred initially. So whether you are a small or large scale investor, whether you have been holding Bitcoin for a short or long period of time I would be really interested in your views on the currency.

Full anonymity will be ensured and your membership name and details will be kept confidential, unless you explicitly request that your user name be disclosed. Any articles or pieces coming from this research will be made publicly available and will be posted on the Bitcoin forum for further discussion. Because I would ideally like to have as broad a range of participants as possible, please share this message where possible with members of the Bitcoin Forum who you think would be willing to participate.

If you are interested in participating please message me via the forum and I will send you 8 simple and open-ended questions for you to answer in your own time, the questions will be focused on your views about the currency and your reasons for investing in Bitcoin.

Your participation would be much appreciated and I hope this research will serve to correct some of the widely held misunderstandings about Bitcoin.

Thank you.

Well I think what's interesting about Bitcoin is that it raises big and important questions about what money is and whether we need it. I detect a certain anarcho communism in some of the replies which suggest we can live without money (not something I'm averse to, but very difficult to achieve).

I think David Graeber is interesting here and his book Debt: A 5000 Year History. He makes some interesting claims based on extensive anthropological research and some leftie anarchist sympathies. Here are some of the points he makes in the book that are relevant to the debate about money:

1. While we think that money came from barter there is no anthropological evidence for this, actually the way villages often operated before money existed is people would do each other favours, there would be a strong sense of obligation. For example somebody gives you some milk, so next time you pay them back with a piece of meat; and the anthropological evidence from ancient civilisations (like Mesepotania) suggests this is what happened rather than barter. His argument is that barter is a myth generated by the economists, which has become entrenched and seen as common sense.

2. The idea of debt or obligation pre-existed money, so we have this idea of doing each other favours. In villages somebody would give someone a favour and the other person would try and do a bigger favour in turn. These communities based around reciprocal responsibilities and returning favours have existed for a long time before money. Graeber argues that money came into existence because governments (or rather monarchies) needed to fund wars and money was an effective means of orchestrating this.

3. Finally, we do these things today don't we? Say you buy a group of friends a beer, and you expect them to get you a beer later but if you are a nice bloke (or lady) you don't worry about it if they don't. However, if they really are your friends another time you will be in a bar and they will get you a beer. In a sense this kind of transaction is not based on exchange because you do not buy the beer because they will buy you one, its more a sense of an obligation you have. Graeber is an anarchist so he thinks these aspects of human behaviour can become the basis for an alternative society.

Anyhow its an interesting book. So regarding the points that were made earlier about why we need money:

1. How will you store or stockpile your reserves (for hard times, such as drought or famine) ?
2. If barter is not available, then how you will purchase the things you need?
3. How will you pay your taxes?

Well none of these things are essential if you can imagine an alternative society in which is based on people helping one another and doing each other favours. People lived in societies without money a few thousands of years ago.

Finally going back to Bitcoin, I don't think its the answer to all our problems but it is important because it is a technological invention that allows us to question the money system and the problems it causes. Bitcoin also shows us that alternative systems are possible.

Hello,

I hope to get it published somewhere but academic publishing is a long, difficult and draining process nowadays. My hope is to get it into the Manchester Capitalism working papers series initially as that's open access - but that probably won't be for 6 months to a year or so at least. However, I will put up a link here to any articles or pieces that do come out of this, if and when that happens.

Thanks.

I haven't used Survey Monkey because I would rather not involve more websites than strictly necessary for the process. The Bitcoin Forum is one I trust, people have been good natured and helpful thus far in responses and other discussions I have had on the Forum. It is also helpful for me to know how active those that participate in the survey are in the Bitcoin Forum too (something I can easily find out on the website) - although this will not be connected to anyone's specific username in any results that are released.

Still as I have said I will not release any specific details of participants usernames in any research that is published as a result, it would be a violation of my obligation to participants as a researcher if I did this.

Despite the prophets of doom (well mainly stupid economists) declaring that the recent actions of the Chinese central bank would dramatically hit Bitcoin, these people thus far appear to have been wrong. I have also noticed some on the Bitcoin Forum claiming that when the policies were enacted at the end of January this would cause a significant negative effect (but this has not happened, probably because any hit has already been taken with the release of the memo).

There is considerable ambiguity around the declaration of the People's Bank of China that caused a significant temporary drop in the value of Bitcoin from its all time high a couple of months ago (in English here) https://vip.btcchina.com/page/bocnotice2013

In fact after the Chinese legislation attempting to stop some Bitcoin exchanges at the end of January, the major Bitcoin exchanger in China is still open for business claiming they do not contravene the memo, and allowing Bitcoin-to-Yuan deposits. http://rt.com/business/bitcoin-china-btc-reopen-458/

So my question is quite simply: What do you think is going on here and how is this likely to pan out in the future months in China?

This is of course a matter of opinion, so its good to hear substantive arguments and positions on both sides.

Iv'e seen lots of explanatory vids on youtube. If you have a link to a specific one that addresses this issue then please provide a link.

Hello all,

I am a researcher at the University of Manchester in the UK and I have a long standing interest in Bitcoin, as well as owning some of the currency. There remains lots of further research to be undertaken into Bitcoin from different angles and I have a particular interest in the political challenge to the existing money system that is posed by the emergence of alternative virtual currencies.

Just to give some background to my research, I have read a large number of sceptical pieces about Bitcoin from economists in a range of blogs and newspaper articles, but there has been very little work I have seen that examines those that own Bitcoin and their reasons and motivations. It strikes me that this is a major gap in the literature since we can only understand Bitcoin's future as a currency and an asset by understanding the motivations of the community around Bitcoin. For these reasons I would like to undertake a survey of members of the Bitcoin Forum with as broad a range of participants as possible, I am aiming for roughly between fifty and a hundred initially. So whether you are a small or large scale investor, whether you have been holding Bitcoin for a short or long period of time I would be really interested in your views on the currency.

Full anonymity will be ensured and your membership name and details will be kept confidential, unless you explicitly request that your user name be disclosed. Any articles or pieces coming from this research will be made publicly available and will be posted on the Bitcoin forum for further discussion. Because I would ideally like to have as broad a range of participants as possible, please share this message where possible with members of the Bitcoin Forum who you think would be willing to participate.

If you are interested in participating please message me via the forum and I will send you 8 simple and open ended questions for you to answer in your own time, the questions will be focused on your views about the currency and your reasons for investing in Bitcoin.

Your participation would be much appreciated and I hope this research will serve to correct some of the widely held misunderstandings about Bitcoin.

Thank you.

Hello all,

I am a researcher at the University of Manchester in the UK and I have a long standing interest in Bitcoin, as well as owning some of the currency. There remains lots of further research to be undertaken into Bitcoin from different angles and I have a particular interest in the political challenge to the existing money system that is posed by the emergence of alternative virtual currencies.

Just to give some background to my research, I have read a large number of sceptical pieces about Bitcoin from economists in a range of blogs and newspaper articles, but there has been very little work I have seen that examines those that own Bitcoin and their reasons and motivations. It strikes me that this is a major gap in the literature since we can only understand Bitcoin's future as a currency and an asset by understanding the motivations of the community around Bitcoin. For these reasons I would like to undertake a survey of members of the Bitcoin Forum with as broad a range of participants as possible, I am aiming for roughly between fifty and a hundred initially. So whether you are a small or large scale investor, whether you have been holding Bitcoin for a short or long period of time I would be really interested in your views on the currency.

Full anonymity will be ensured and your membership name and details will be kept confidential, unless you explicitly request that your user name be disclosed. Any articles or pieces coming from this research will be made publicly available and will be posted on the Bitcoin forum for further discussion. Because I would ideally like to have as broad a range of participants as possible, please share this message where possible with members of the Bitcoin Forum who you think would be willing to participate.

If you are interested in participating please message me via the forum and I will send you 8 simple and open ended questions for you to answer in your own time, the questions will be focused on your views about the currency and your reasons for investing in Bitcoin.

Your participation would be much appreciated and I hope this research will serve to correct some of the widely held misunderstandings about Bitcoin.

Thank you.

Yes I don't disagree with anything there. But that sort of leaves out my point that financial capitalism is based on unsustainable bubbles, that's just what keeps the clock ticking - or the markets rolling. And in financial capitalism as we saw from the financial crisis some win and others lose. Its a feature of capitalism, the only difference is when the banks generate and create huge bubbles that burst they get saved by governments...

Eventually there will be a big drop in Bitcoin's value - because there will be a shortage of liquidity when somewhere close to 21 million Bitcoins are created and people will stop spending and that's characteristic of a bubble. But as I suggested I think that's decades away.

Your point about something not being a bubble due to 'expectation of adoption' and whether it is realistic is interesting. However, that would mean that subprime wasn't a bubble when more and more pension funds and others were investing in them and their asset price was increasing and then suddenly became a bubble when the shit hit the fan and the NINJA loans came to town. So there is a temporal aspect in your definition, which would mean that something isn't a bubble when the price is rising and is a bubble when it bursts.

So I guess you are stepping along the lines of Keynes and animal spirits, when market actors expect the cake to get bigger it gets bigger when they think the cake will get smaller it gets smaller. Capitalism is based on uncertainty and fluctuating expectations and therefore it is based on bubbles, which Bitcoin is a very unusual case of.

I'm quite curious about this, we seem to constantly hear respected economists saying Bitcoin is a bubble most recently Robert Shiller http://rt.com/business/bitcoin-shiller-bubble-davos-127/

My response is: yes of course but why should we care, that isn't either a very profound or interesting point.

Here's why:

1. Ok because there is a finite amount of the currency there is likely to be a deflationary spiral at some point, since people will become increasingly keen to keep hold of their scarce asset rather than sell it until there is a mass sell off; that's a common economist argument. But I think that is at least decades off and we are still in the early days of the currency. The interesting question is how much more will the value of Bitcoin increase before it bursts?

2. Secondly, and this is perhaps the key point: Financial capitalism is based on unsustainable and periodic bubbles. That's simply the history of financial assets and because Bitcoin is highly volatile its a bubble that has potentially huge gains for the foreseeable future.

3. This is something I am interested in researching further, I don't think Bitcoin is like conventional bubbles because bubbles depend on the character of their members. People hold Bitcoin for financial reasons but they also do for social and political reasons - many have motivations beyond financial profit, which means that as a bubble it is likely to be a fair bit stronger than the debt derivative bubbles that fuel contemporary financial capitalism.

4. We have seen a number of slumps in Bitcoin's value - after the whole business in China most recently. And given some of the government's moves in China we may see another drop in Bitcoin's value this week. However, each time the value of Bitcoin post short term drop is considerably higher than before. So if its a bubble is a pretty strong one, one which when it does deflate slightly is bigger than when it last deflated, and it then expands rapidly again with time.

5. While Bitcoin is likely in the distant but not yet foreseeable future to succumb to a huge deflation; the value of it as an invention is that it shows us that alternative currencies are workable and possible in the global economy without the state. Electronic currencies will continue to expand in variety and form and Bitcoin has blazed a trail that others can and will follow in future.

Also it quite amuses me that when famous economists critique Bitcoin for being a bubble - Krugman most famously - it does no damage to the currency at all, in fact it tends to increase its value. So if someone tells you Bitcoin is a bubble that will eventually deflate, I think we can just say 'so what?' for the above reasons.

Actually I never thought this was even an issue. You are right that Bitcoin drifts between being seen as a commodity/asset that people store and as a medium of exchange. I think its the latter of these that is more significant in terms of its implications and where its most important that Bitcoin continues to grow; since then Bitcoin will be taken increasingly seriously in the global economy as an alternative money form.

However, we also know that the one certainty in a recession is that the price of gold will rise. Because Bitcoin is similar to gold in that it is finite and mined, and because its growth in value has historically had some clear parallels with gold although in much more volatile fashion (see the third figure down in this blog post from Stubborn Mule http://www.stubbornmule.net/2013/05/bitcoin-what-is-it-good-for/).

That would suggest that another recession (which is certainly more than on the cards, since nothing has really changed since the last one) would be a great thing for Bitcoin. Because during economic crashes people lose their faith in the existing money supply and look for alternatives like gold, and increasingly now: like Bitcoin.

Also government and banks are trying to inflate their way out of the downturn at the moment - which is likely to get even worse after another crisis, so that means people who are still fortunate enough to have savings (they do exist in significant numbers even if they are being continually punished by prolonged low interest rates) will look for an alternative way of converting their savings. A way less prone to inflation generated by ever increasing paper money supply, which again will result in an increase in Bitcoin's value.

Thanks, prolom. I think I would agree with your conception of anarchism; but there are one or two differences between our positions that I’m trying to think through.

My main point of disagreement I reckon would be that I think your argument that economists just ‘point out tendencies’ rather than state ‘how societies should and will work’ is unsustainable. Every economist who has written on Bitcoin seems to take a political position - ok these are pretty much invariably rants with little historical perspective or understanding of alternatives to our current money system, this is one of the things I like about Graeber, that he does look at the tremendous historical diversity of money systems. Krugman is the most famously ill informed of course. It would be interesting to know if you could write neutrally about Bitcoin, pretty much invariably when people do write about Bitcoin they are making a judgment about how society works and how it could work.

Mainstream economists by focusing on particular things, like fantasy market equilibrium, are ultimately making a judgment about how society really is working or should work. So I guess I’m saying that in focusing on particular phenomenon and ignoring others – like levels of toxic bank debt – economists are acting politically rather than just reporting things; even if they claim that’s all their doing.

Added to this, if you look at the Austrian School (who undoubtedly in one way or another are the closest forerunners to Bitcoin in terms of their theories), such as Von Mises, they are making at times a powerful critique of state involvement in the economy and in doing so they are making a political statement about how society should work.

We have certainly seen the failings of totalitarian ‘socialist’ systems historically. An Austrian like Hayek might argue that one of the reasons that we have over priced housing - and in the UK for example a housing shortage - is the system of central bank driven, state compliant, capitalism. In which government encourages banks to lend for mortgages, which inflates housing prices way above affordable levels for many and land owners and property developers don’t have much incentive to build. Because by not building houses during downturns they inflate the value of the properties they have further.

There’s undoubtedly some truth to that reading but I also want to say that genuinely market driven capitalism does present a significant danger of monopolies. And monopolies actually prevent competition and stagnate markets. This is one of the interesting things about Bitcoin because it poses a direct challenge to the central bank/state driven monopoly over money creation.

That point about the danger of monopolies connects to your final point about the internet. One of the key battles in the history of the internet is between people and communities who genuinely like doing free shit and making things available to share and large corporations (I don’t even need to name them) that would like to monopolize all of your web browsing and purchasing habits. This battle is an ongoing one of course, the Tor network and piracy are both significant inventions for the decentralized version of the web - and Bitcoin has an interesting place in that battle as a decentralized currency and asset.

I wouldn't disagree. But I'm struggling to think of an anarchist economist, I think the Austrians are better defined as economic libertarians rather than anarchists. Hayek for example appeared to accept a strong roll for the state in terms of law and order.

Although I have to be honest I haven't read Rothbard - perhaps he's someone I should make an effort to read. Is that the anarchist economist we should be reading? And are his ideas complimentary with Bitcoin?

I'm certainly pretty sceptical about the development of Bitcoin banks myself. But I just had a quick look online and there is an organisation which appears to call itself the first Bitcoin bank, Flexcoin (a good name for a future currency perhaps):

http://www.flexcoin.com

Still that just seems to make exchanges easier from different devices, in fact I don't really see the point in it at all.

Still if we do have Bitcoin banks emerging, then surely it is only a matter of time before we get Bitcoin banks and lending. This is the whole point of modern banking: looking to make a cheap buck through lending.

Thanks. I think the last question about 'anarchist economists' is particularly interesting.

Depending how you define anarchism, and I don't mean to be difficult, but it could be argued that economics (at least its mainstream and all its dominant trends) as a discipline is in fundamental tension with anarchism. That is, the contemporary money system that we live in requires the state and requires banks; so it requires aspects of organisation that are in tension with anarchism. And economists hardly ever question this system; in fact it is an assumption which they tend to take as given when they create their models.

Now you could say that people like Hayek and Von Mises are verging on elements of anarchism in that Von Mises argues particularly strongly that value is created subjectively and through human interaction, while Hayek argues provocatively for a free competition between currencies (including, in fact especially, non-state backed ones). Both of these Austrian School thinkers are deeply sceptical of state intervention in the economy. However, I think it is better to define them as libertarian rather than anarchist. Since their libertarianism is economic rather than social.

I think anarchists would go the whole way and want community to replace economics in social affairs and left anarchists in that sense are sort of anti-monetary exchange. You might think this is a bit strong, but it is a position David Graeber (whose a pretty famous social anthropologist rather than an economist) argues for in his really interesting Debt: The First 5000 Years.

So I would think of Bitcoin as libertarian rather than anarchist. Perhaps I'm too influenced by Graeber here, but this also make me think that a genuinely anarchist economics is impossible.

Well Keiser is certainly the best journalist/financial analyst around and the biggest Bitcoin supporter but I don't think he'd call himself an economist.

Iv'e seen Keiser refer to the debate within the Austrian School about Bitcoin and how some members of the Austrian School support Bitcoin while others don't. He obviously tells the one's that don't that they are wrong. T

My suspicion is most people who really believe in Bitcoin would say Von Mises, which is interesting but I'm interested if there are any other suggestions that are less familiar.

The related question would be which economist is most consistent with the ideas behind Bitcoin? But I didn't have space to ask that in the title.

I guess most people would go for someone in the Austrian School (but then which one of the Austrian School?)

Von Mises seems to be a sort of close precursor to Bitcoin but its also been argued that Bitcoin contradicts the regression theorem. Very simplistically, the idea that any currency must have an original basic value in itself before it becomes used as currency. I don't see that as a particularly strong objection but I have seen it referred to in one or two Von Mises Institute pieces.

I have seen the label Keynesian mentioned once or twice on the Bitcoin Forum as a critique, but you could also argue that Keynes (if you take a radical interpretation of Keynes, like Minksy did) saw real problems with finance and banking running riot and swallowing us in debt. Something which arguably Bitcoin presents a serious alternative too in the present world.

Hayek in the Denationalisation of Money argues that we should have a sort of free competition between currencies which again seems strongly consistent with what Bitcoin is.


So just out of interest, who would be your favourite economist, which is best for understanding alternative currencies like Bitcoin and why? Suggestions please...

Hello all,

As a newcomer to Bitcoin who invested a bit a few months ago. I'm interested in how people see the currency changing as it develops. I've read some people who argue that any currency needs a system of credit and banking behind it to be sustainable. Are we going to see the emergence of Bitcoin banks in future and systems of Bitcoin lending?

It could be argued that not having any kind of credit system means that the currency becomes more of a commodity as people invest in it as an asset but it also must be recognised that banking is precisely what has resulted in huge global economic instability and massive economic crises, particularly in Europe and America in recent years.