On Bitcoin Speculation
The Latin root of the word "speculation" is specere, which means...
Do you know what the Latin root of the word “speculation” is?
Here you go:
I realized this last week after praying for vocation clarity. The Austrian school of economics (through its emphasis on time) says it’s a legitimate form of work that requires a unique skillset.
Before this insight, I thought that speculation was bad. Buying low and selling high. Not doing any work. Some Catholics online posit this.
But no.
The Austrian school definition
Speculation is the act of holding something to bring it from the present to the future so people can benefit from it then. It is the most financially rewarding kind of work if you’re good at it. (If you’re bad at it, you get financially ruined — and it’s competitive.) Good speculators specialize in one niche and dedicate their life to it. They often get one opportunity to act that changes their life step-change forever. JW Weatherman talks about this in his course, drawing upon the Austrian school of economics.
A family example
An example from today. My cousin and his wife are expecting their first baby and had their baby shower today. As Bitcoiners love to do, I gifted them sats. I set them up with a digital wallet and sent 200,000 sats to it, then gave them the recovery phrase and a note saying “You can call me for help.”
My cousin and wife and their baby don’t know they will probably need this 20 years from now. And they don’t know how to do it. So I do it for them now, instead of buying them a blender or something. Napkin math says 200,000 sats is five times the average person’s life savings if Bitcoin becomes global money, so it could pay for her education. Mom said he was excited when opened the gift and read the note.
What about St. John Paul II?
In his encyclical on the dignity of work, Centesimus Annus, Pope John Paul II wrote (where “ownership of the means of production” refers to assets):
Ownership of the means of production, whether in industry or agriculture, is just and legitimate if it serves useful work. It becomes illegitimate, however, when it is not utilized or when it serves to impede the work of others in an effort to gain a profit which is not the result of the overall expansion of work and the wealth of society, but rather is the result of curbing them or of illicit exploitation, speculation or the breaking of solidarity among working people. Ownership of this kind has no justification and represents an abuse in the sight of God and humanity.
I will argue St. John Paul II’s definition of speculation does not match the Austrian school definition. Today people use the word “speculation” to refer to short-term investing, and use the word “investing” to refer to long-term investing. “Speculation” referred to long-term investing when Menger wrote in 19th-century Catholic Austria.
Bitcoiners holding a new monetary asset to bring it to the future does not impede the work of others, nor reduce the wealth of society. This act of Austrian speculation intends to do the opposite, in fact. Bitcoin is about setting the cost of capital so others can work more efficiently to increase the wealth of society.
It seems like the misunderstanding is about terminology.
Bitcoiner mission clarity
So last week I moved forward with more mission clarity. Turns out it’s just been doing what I’ve been doing, but with a mindset that it’s okay. And an understanding that I’m uniquely suited to hodling because of the gifts and experience the Lord has blessed me with.
This is what the week looked like:
Monday whoa this is amazing. I think I found my vocation
Tuesday praise the Lord. Help parents manage retirement planning
Wednesday study Michael Saylor speculation
Thursday study more, look at capriole.com data, adjust buy-and-hold portfolio
Friday work on Bitcoin hobby project
Should you be Bitcoin speculator? It’s a tiny percentage of the population so… take care with this decision. Fortunately, you won’t have to speculate if Bitcoin wins. Instead, you’ll simply pursue their work you’re meant to pursue, and it will be sufficient to support you and your family.
The post-it note last week that inspired this post:
If my vocation is to bring assets from the past in the now into the future to just simply hold so you can have something you don’t know that you need in the future and just wait and battle my emotions. Battle the doubt. Battle feeling crazy. The volatility. Withstanding all that, well then with all that waiting interior battle, my vocation must benefit to just pray to intercede. Wait, patience, exercising, patience. Studying. Watching both market and Faith theology. And if I’m doing a good job with my vocation I will be paid handsomely (good speculation is most rewarded kind of economic work) and I must then give that back
Read all of last week’s insights at the bottom of last week’s post. God Bless, thank you for your prayers, and see you soon.
