The Internet, Policy & Politics Conferences

Oxford Internet Institute, University of Oxford

Thomas Redshaw: A Critical Theory of Bitcoin: Politics Embedded in Design

Thomas Redshaw, University of Manchester

In the aftermath of the 2008 financial crisis, Bitcoin emerged as an alternative monetary system that could circumvent political and financial authorities. As an entirely distributed network, Bitcoin offered a platform for both protest and subversion. No centrally-run servers or organisations were necessary for Bitcoin to deliver a means of exchanging digital assets. In this context, practices initially emerging around Bitcoin unsurprisingly exhibited a political dimension. In this paper however, the technical architecture and functionality will itself be presented as political in character. It will be posited that Bitcoin, as a platform, is embedded with the political values active in its design process. These values continue to shape the ways in which many engaging with Bitcoin understand the technology, informing their practices and beliefs. To interpret the tensions between technological design and social values, the paper will draw on the critical theory of technology as put forward by Andrew Feenberg.

Throughout his work Feenberg has advanced a constructivist approach to understanding technological development which contends that choices made in the design stage of any given technology reflect the interests and beliefs of the various social groups influencing the design process. Feenberg’s key contribution however, is to highlight the power dynamics active in these processes. Not only are some interests and beliefs privileged over others, our dominant understanding of technology entails that many of these privileged interests appear as distinct from the social imperatives that informed them. Choices in design appear as the result of technical reasoning alone. As a consequence, the social imperatives guiding design choices are often concealed, justified, and rationalised by technical reasoning. These insights allow for a critical analysis of Bitcoin, investigating the imperatives and beliefs informing its historical development, and how relationships between values and technological design continue to inform the beliefs and practices of users.

The research data presented in this paper is drawn from two lines of study developed over the course of a PhD thesis. As an open source platform, Bitcoin provides particular methodological opportunities to investigate design. Archived data from internet forums utilised during the design and development of Bitcoin and its predecessors is analysed, alongside white papers specifying technical protocols, to investigate the historical development of Bitcoin. Forum discussions and white paper rationales reveal the motivations, interests and beliefs informing the technical choices made in design. Tracing the origins of the various innovations that were eventually brought together in the Bitcoin white paper, this paper will detail the beliefs and motivations of early developers of digital cash systems. It will show how concerns were expressed with the direction of development in computer systems. Where computer networks had once promised to liberate people from powerful hierarchies, as they grew larger and processed more personal information, they increasingly threatened individual liberties, creating the conditions for new concentrated forms of power and control. Encrypted and decentralised technologies were increasingly sought to address these concerns, and in the course of development, a particular economic discourse entered the design process as a means to understand the economic as well as technological potential for such a system. This discourse is rooted in the work of Austrian economist Carl Menger, in which money is understood as a commodity. This paper will show how not only these earlier technical innovations are brought into the design of Bitcoin, but how the concerns of the early developers, and the Mengerian concepts they turned to, are also demonstrably embedded in the technical architecture of Bitcoin.

The collaborative and transparent character of open source projects carries a further benefit for researching technological development. Practices emerging around open source innovation also tend to exhibit these inclusive qualities, evidenced in the open meetings and conferences organised by enthusiasts and developers. During the course of the PhD thesis, these sites have been the starting point for a snowball sample of research participants engaging with Bitcoin in various ways. Observing such meetings and interviewing attendees across various contexts including London, Prague and Barcelona, has allowed for a rich set of qualitative data with which to analyse the diverse ways in which people understand and engage with Bitcoin. Whilst these findings reveal multiple paths of development originating in Bitcoin, this paper will focus on the practices and tensions surrounding the articulation of the technology expressed in the Bitcoin white paper. It will detail how the values and beliefs embedded in the design of Bitcoin play a continuing role in making sense of technology for its users. For these users, Bitcoin is understood as money in Mengerian terms, and this informs their practices and wider attitudes to economic and social issues. Here, Feenberg’s critical theory is brought back to interpret how the values implicit in this logic have been condensed within technical reason. The practices of these users reveal not only that Austrian economics informs their use of Bitcoin, but also how the functionality of Bitcoin acts to justify and rationalise the logic of Austrian economics. Bitcoin demonstrates to users that Austrian economics works. As Bitcoin replaces trust in centralised institutions with decentralised algorithms, it appears as pertaining only to the objective laws of mathematics. The social imperatives guiding its design and use are in this way rationalised and concealed by its functionality, and this in turn informs the direction of its development.

This paper will conclude by detailing the ways groups of users have engaged with Bitcoin in ways that subtly undermine the politics embedded in its design. Such practices include speculation and entrepreneurship which have triggered an ironic turn of events in which the future of Bitcoin as a technology appears to be dominated by ways that advantage the financial institutions it was designed to circumvent. As a platform, Bitcoin allows for a range of innovative and collaborative practices, as well as subversive and disruptive practices. What is clear however, is that social processes are key to understanding both the direction of its development and its impact on the beliefs and practices of its users.

Thomas Redshaw