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Anyone who has read Cryptonomicon should remember that the hero protagonists went to a lot of effort to secure a large mass of gold to 'back' the currency they

Anyone who has read Cryptonomicon should remember that the hero protagonists went to a lot of effort to secure a large mass of gold to 'back' the currency they wanted to create. The Baroque Trilogy is less clear as Isaac Newton mints new currency. Does that mean that perhaps Stephenson's opinions were always that currency needs to be backed by something whether it is gold or national borders.

herculity275 4y ago
And yet his best approximation of cryptocurrency actually comes from REAMDE, in which it's an in-game currency for an MMO backed by virtualized geology (which doesn't sound too different from Bitcoin hash rate).
- dariusj18 4y ago
  Well that *was* released after bitcoin was created
hoherd 4y ago
Don't forget Reamde: > It didn’t take a huge amount of acumen, then, to understand that the value of virtual gold in the game world could be made stable in a directly analogous way: namely, by forcing players to expend a certain amount of time and effort to extract a certain amount of virtual gold (or silver, or diamonds, or various other mythical and magical elements and gems that the Creatives would later add to the game world). > Other online games did this by fiat. Gold pieces were reposited in dungeons guarded by monsters. The more powerful the monster, the more gold it was squatting on. To get the gold, you had to kill the monster, and building a character powerful enough to do so required a certain amount of time and effort. The system functioned okay, but in the end, the decision as to where the gold was located and how much effort was needed to win it was just an arbitrary choice made by a geek in a cubicle somewhere. > Richard’s crazy idea was to eliminate the possibility of such fudging by having the availability of virtual gold stem from the same basic geological processes as in the real world. The same, that is, except that they’d be numerically simulated instead of actually happening.
- patapong 4y ago
  Also related, from the Diamond Age: > The media net was designed from the ground up to provide privacy and security, so that people could use it to transfer money. That's one reason the nationstates collapsed-as soon as the media grid was up and running, financial transactions could no longer be monitored by governments, and the tax collection systems got fubared.
arethuza 4y ago
Nitpick: Isn't it the Baroque Cycle? https://en.wikipedia.org/wiki/The_Baroque_Cycle https://en.wikipedia.org/wiki/The_Baroque_Cycle
Y_Y 4y ago
Real Newton worked at the mint too, it may not necessarily represent Stephenson's views. Doesn't Snow Crash have hyperinflation followed by a plethora of private fiat currencies?
- JohnFen 4y ago
  It does, yes. I think a lot of people haven't read the book or have forgotten that the world of Snow Crash is an extreme dystopia -- certainly not the sort of world most people want to live in. That's why I was so baffled as to why Facebook glommed on to the term "metaverse" with such fervor. The "metaverse" comes from that book, and is a major aspect of the dystopia. The term does not have positive connotations.
  - Y_Y 4y ago
    You make a good point, although I might prefer to live in Mr. Lee's Greater Hong Kong than in seventeenth century England.
    - JohnFen 4y ago
      True. There have been many very real dystopias in history. I've long thought that if I had to live in the world of Snow Crash, I would totally want to be in Mr. Lee's Greater Hong Kong over the other corporations. In context of the book, Mr. Lee kinda slapped.
      - Turing_Machine 4y ago
        Mr. Lee would definitely beat the Mafia, at least if you got on the bad side of management. One of the most amusing parts of that book was how the Mafia had recruiting booths at college job fairs, just like the other corporations.
  - airstrike 4y ago
    So does "avatar", tbh
  - 4y ago
hprotagonist 4y ago
Lest we forget, The Great Simoleon Caper https://en.wikipedia.org/wiki/The_Great_Simoleon_Caper https://en.wikipedia.org/wiki/The_Great_Simoleon_Caper In the story, the protagonist is an underemployed mathematician who resides in the house of his brother's family in Chicago. The brother, owner of an advertising agency, has won a large contract to create ads for "Simoleons", a form of non-governmental electronic "currency". To launch the product, they plan to give away 27 million Simoleons to the winners of a contest. The contest is based on the long-used format of "guess the number of jelly beans in the container", with Chicago's Soldier Field and 26 other football stadiums as the containers. so, 1995 cryptobros, sports stadiums, and damn near NFTs.
jfengel 4y ago
Meanwhile, Terry Pratchett explains why fiat currency works just fine in Making Money.
nosianu 4y ago
As I understand money creation, at least the part created by commercial banks as described in "Bank of England: Money creation in the modern economy" -- https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-creation-in-the-modern-economy https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/m..., that debt-based money is backed by something of value: The promise of the debtor to create something valuable which itself earns money, and more than was used to create it. . Here is a tiny story I once heard or read. I know it's only a very simplified, used to show debt based money creation, but such partial stories is all that's possible for this arbitrarily complex story of "money", because it's mostly a mind game of artificial rules. (If anyone can find this story I'd appreciate it, I don't remember where I read it, some book?) A boy writes on a paper that he gives to his parents the promise to mow the lawn whenever that paper is presented to him to fulfill the promise. He got something in return from them right away, apparently the lawn didn't need trimming at that time so they resorted to the "debt paper". Instead of using it themselves the parents gave it to some neighbors in exchange for something they needed from them. And the neighbors too gave it to yet other neighbors. The promise to mow the lawn had become "money". As soon as somebody actually uses it to get their lawn mown it is destroyed, the "money" is gone. So, all our debt based money, at least as far as it was created through companies or firms taking it on, is backe by various promises for money-cresting projects, for example For a business it could be something like "I/we promise to build a factory that builds xyz and markets and sell it to _somewhere_." For an individual consumer something like "I promise to work hard for ten years to create more value, i.e. make more money than the amount just created for me in advance of my promise." So all that debt based money we keep using everywhere is not "merely paper without any value", it's backed by people's and businesses signed and certified promises to perform work and/or create measurable value. Yes actual money is way more complicated, yet I find this story quite revealing. In all sciences we regularly use very simple "stories" too (e.g. the first model of the atom everybody learns, or the second, and third too, all way too simple from the PoV of the physicist, or molecular bonds taught in chemistry, getting more complicated with each iteration of level of education). As far as I can see having the promise of a human to do something (valuable) is way more useful than anything else when averaging over all contexts. I'm sure one can easily think of specific contexts where something else is more valuable, but pointing it back at humans seems to me to be the most genius way of putting "value" behind the currency. That we have created soooo much more other stuff on top of the idea, for special situations and for special interests, IMO does not detract from it. Also, that the banks can create money but need to find people willing to sign also looks like some really genius balanced design to me - as an idea, how it is then implemented in practice of course always suffers from the pulls of all the interests from all directions. We also have a system that puts significant pressure on the debtors to fulfill their promises.
bko 4y ago
How is a currency "backed" by borders? The country can make a currency as the sole method to pay taxes which is the norm, but they can always ditch the currency and force you to trade it in for a different one at a fixed exchange
WeylandYutani 4y ago
If you can't use a currency to pay bills or mortgage it's pretty useless.

herculity275 4y ago

And yet his best approximation of cryptocurrency actually comes from REAMDE, in which it's an in-game currency for an MMO backed by virtualized geology (which doesn't sound too different from Bitcoin hash rate).

dariusj18 4y ago
Well that *was* released after bitcoin was created

hoherd 4y ago

Don't forget Reamde: > It didn’t take a huge amount of acumen, then, to understand that the value of virtual gold in the game world could be made stable in a directly analogous way: namely, by forcing players to expend a certain amount of time and effort to extract a certain amount of virtual gold (or silver, or diamonds, or various other mythical and magical elements and gems that the Creatives would later add to the game world). > Other online games did this by fiat. Gold pieces were reposited in dungeons guarded by monsters. The more powerful the monster, the more gold it was squatting on. To get the gold, you had to kill the monster, and building a character powerful enough to do so required a certain amount of time and effort. The system functioned okay, but in the end, the decision as to where the gold was located and how much effort was needed to win it was just an arbitrary choice made by a geek in a cubicle somewhere. > Richard’s crazy idea was to eliminate the possibility of such fudging by having the availability of virtual gold stem from the same basic geological processes as in the real world. The same, that is, except that they’d be numerically simulated instead of actually happening.

patapong 4y ago
Also related, from the Diamond Age: > The media net was designed from the ground up to provide privacy and security, so that people could use it to transfer money. That's one reason the nationstates collapsed-as soon as the media grid was up and running, financial transactions could no longer be monitored by governments, and the tax collection systems got fubared.

arethuza 4y ago

Nitpick: Isn't it the Baroque Cycle? https://en.wikipedia.org/wiki/The_Baroque_Cycle https://en.wikipedia.org/wiki/The_Baroque_Cycle

Y_Y 4y ago

Real Newton worked at the mint too, it may not necessarily represent Stephenson's views. Doesn't Snow Crash have hyperinflation followed by a plethora of private fiat currencies?

JohnFen 4y ago
It does, yes. I think a lot of people haven't read the book or have forgotten that the world of Snow Crash is an extreme dystopia -- certainly not the sort of world most people want to live in. That's why I was so baffled as to why Facebook glommed on to the term "metaverse" with such fervor. The "metaverse" comes from that book, and is a major aspect of the dystopia. The term does not have positive connotations.
- Y_Y 4y ago
  You make a good point, although I might prefer to live in Mr. Lee's Greater Hong Kong than in seventeenth century England.
  - JohnFen 4y ago
    True. There have been many very real dystopias in history. I've long thought that if I had to live in the world of Snow Crash, I would totally want to be in Mr. Lee's Greater Hong Kong over the other corporations. In context of the book, Mr. Lee kinda slapped.
    - Turing_Machine 4y ago
      Mr. Lee would definitely beat the Mafia, at least if you got on the bad side of management. One of the most amusing parts of that book was how the Mafia had recruiting booths at college job fairs, just like the other corporations.
- airstrike 4y ago
  So does "avatar", tbh
- 4y ago

hprotagonist 4y ago

Lest we forget, The Great Simoleon Caper https://en.wikipedia.org/wiki/The_Great_Simoleon_Caper https://en.wikipedia.org/wiki/The_Great_Simoleon_Caper In the story, the protagonist is an underemployed mathematician who resides in the house of his brother's family in Chicago. The brother, owner of an advertising agency, has won a large contract to create ads for "Simoleons", a form of non-governmental electronic "currency". To launch the product, they plan to give away 27 million Simoleons to the winners of a contest. The contest is based on the long-used format of "guess the number of jelly beans in the container", with Chicago's Soldier Field and 26 other football stadiums as the containers. so, 1995 cryptobros, sports stadiums, and damn near NFTs.

jfengel 4y ago

Meanwhile, Terry Pratchett explains why fiat currency works just fine in Making Money.

nosianu 4y ago

As I understand money creation, at least the part created by commercial banks as described in "Bank of England: Money creation in the modern economy" -- https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-creation-in-the-modern-economy https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/m..., that debt-based money is backed by something of value: The promise of the debtor to create something valuable which itself earns money, and more than was used to create it. . Here is a tiny story I once heard or read. I know it's only a very simplified, used to show debt based money creation, but such partial stories is all that's possible for this arbitrarily complex story of "money", because it's mostly a mind game of artificial rules. (If anyone can find this story I'd appreciate it, I don't remember where I read it, some book?) A boy writes on a paper that he gives to his parents the promise to mow the lawn whenever that paper is presented to him to fulfill the promise. He got something in return from them right away, apparently the lawn didn't need trimming at that time so they resorted to the "debt paper". Instead of using it themselves the parents gave it to some neighbors in exchange for something they needed from them. And the neighbors too gave it to yet other neighbors. The promise to mow the lawn had become "money". As soon as somebody actually uses it to get their lawn mown it is destroyed, the "money" is gone. So, all our debt based money, at least as far as it was created through companies or firms taking it on, is backe by various promises for money-cresting projects, for example For a business it could be something like "I/we promise to build a factory that builds xyz and markets and sell it to _somewhere_." For an individual consumer something like "I promise to work hard for ten years to create more value, i.e. make more money than the amount just created for me in advance of my promise." So all that debt based money we keep using everywhere is not "merely paper without any value", it's backed by people's and businesses signed and certified promises to perform work and/or create measurable value. Yes actual money is way more complicated, yet I find this story quite revealing. In all sciences we regularly use very simple "stories" too (e.g. the first model of the atom everybody learns, or the second, and third too, all way too simple from the PoV of the physicist, or molecular bonds taught in chemistry, getting more complicated with each iteration of level of education). As far as I can see having the promise of a human to do something (valuable) is way more useful than anything else when averaging over all contexts. I'm sure one can easily think of specific contexts where something else is more valuable, but pointing it back at humans seems to me to be the most genius way of putting "value" behind the currency. That we have created soooo much more other stuff on top of the idea, for special situations and for special interests, IMO does not detract from it. Also, that the banks can create money but need to find people willing to sign also looks like some really genius balanced design to me - as an idea, how it is then implemented in practice of course always suffers from the pulls of all the interests from all directions. We also have a system that puts significant pressure on the debtors to fulfill their promises.

bko 4y ago

How is a currency "backed" by borders? The country can make a currency as the sole method to pay taxes which is the norm, but they can always ditch the currency and force you to trade it in for a different one at a fixed exchange

WeylandYutani 4y ago

If you can't use a currency to pay bills or mortgage it's pretty useless.