National currency, world currency, cryptocurrency: A Fichtean approach to the Ethics of Bitcoin

Abstract

I investigate ethical questions concerning a novel cryptocurrency, Bitcoin, using a Fichtean account of the ethics of currency. Fichte holds that currencies should fulfill an ethical purpose: providing access, in perpetuity, to the material welfare that underwrites citizens' basic rights. In his nineteenth-century context, Fichte argues that currencies fulfill this purpose better when nations control them (i.e., when they are "national currencies") than when foreigners freely trade them (as "world currencies"). After exploring conditions in which national currencies fail to secure material stability over time, e.g., in corrupt regimes, I develop a Fichtean model for ethically evaluating currencies and evaluate the extent to which Bitcoin meets its standards for ethical currency. I argue that Bitcoin undermines the (monetary) power of nations and, as such, threatens their ability to provide access to necessary material goods. While offering citizens a means of defending themselves against corrupt regimes, Bitcoin forsakes the general welfare and is, as such, unethical by Fichtean lights. K E Y W O R D SBitcoin, ethics of currency, Fichtean ethics Johann G. Fichte argues that nations should abolish "world" currency (e.g., gold and silver) that citizens can trade with foreigners and introduce "national" currency (e.g., banknotes issued by national banks) to be traded only among citizens within the nation's borders. The goal of these monetary changes is to ensure that that the currency's value remains stable over time, such that citizens' basic | 221 SCHARDING | 221 into jewelry, musical instruments, weapons, and other goods. The latter are "fiat" currencies. Fiat currencies like US dollars have no (or minimal) value in themselves. Fiat currencies have value only because the people who use them agree that they have value. If Americans decide, e.g., because the US president declares, that they will no longer accept US dollars as payment for goods then the pieces of paper on which the dollars are printed will lose all value-except, perhaps, as kindling. Without widespread agreement about what a US dollar is worth, no one would be willing to give up (intrinsically valuable) goods in exchange for them.Bitcoin resembles fiat currencies in the sense of having no intrinsic value. It differs from fiat currencies (US dollars, Argentinian pesos, the Euro, and so on) in two ways, which I discuss in turn. First, no centralized authority commands people to use it. Centralized authorities do, by contrast, command people to use the other fiat currencies listed above: they command at least in the sense that nations require their citizens both to use the nation's currency for certain purposes, e.g., to pay taxes to them, and to accept the nation's currency as legal for the repayment of debts. 5 The centralized authority means that populations of people are committed to using national currencies; Bitcoin enjoys no such commitment. In lieu of the commitment, Bitcoin relies for its exchange value on people choosing to use it as currenc...

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