“The tragic irony of the totalitarian deceit is that the epidemic of widespread and unchecked selfishness against which the lying totalitarian proselytizes is unlikely to exist in any circumstances other than the deprivation caused by totalitarianism itself. Wealth come from capital. The destruction of capital, whether from total coercion or total isolation, will lead to poverty one way or another.” Farrington and Meyers (2022, p.271)

In 2009, I wrote a Masters of Research dissertation (maybe should have been focused upon other things), that was a long way from being remotely close to an acceptable standard, that was unfortunately assessed by a very competent Professor from the University of Manchester. Within the dissertation, I made the comment “social capital that can develop within project-oriented organisations” (a dissertation that was completing rewritten before being passed), with zero awareness of what this term meant and that this profession in the room with me was quite the scholar on this topic. He proceeded to school me in a way that still sits with me today, but instead to retreating, tail between legs back to my lowly researcher office, I ultimately had my first peer review article published on the topic of Social Capital, which in turn played its role in securing my first academic position.

Social Capital is a fascinating concept that I feel I learnt a lot about, particularly in terms of its multiple components and the role of plays in allowing organisations to both function and prosper. At its most fundamental it determines how knowledge flows between individuals, that in turn can create a competitive advantage and within large organisations can allow knowledge and resources to flow to opportunities. However, based on how the concept is used in day-to-day life, social capital absolutely doesn’t only exist within a business setting, with research exploring both it’s positive and negative roles in the formation, cohesion and internal conflict within communities. As a result, as a framework, it isn’t only useful to provide a framework for comparing a successful company with a less successful company, but allows as a means of better understanding how and why organisations or communities behave in the way they do. From this position, “personal sacrifice and interpersonal relationships” in Bitcoin is Venice brought my old love of social capital into very clear focus within the context of my current love, bitcoin.

Bitcoin the Economic Asset

Bitcoin went from having no value in 2009 to ~$126k in October 2025, this change in its value has created a considerable amount of interest in the asset. During my time in bitcoin, this was initially a big driver to my interest (OMG, it could be worth so much one day!!!), with the prospects of companies and even nation states purchasing the asset helping the value increase further and more rapidly. As time progressed, and maybe my awareness of the topic of bitcoin has become more, nuanced let’s say, the focus on prices has become less important, which was very helpful during 2022. However, within the broad landscape, for bitcoin to have greater functionality as a hedge or corporate asset, it needed to be larger, meaning the approval of spot ETFs was of great interest. It allowed a large portion of capital that may not be interested in the details, mechanisms or broader functionality of bitcoin, but simply saw it as another asset to have their portfolio, to gain access so during 2024 and 2025 this institutional support likely played it role in the increases in value of the asset.

Yes, this is great, at least in October anyway, the dollar value of my little stack was looking very healthy, the assets I hold in MSTR (I can’t buy bitcoin with some accounts) were also doing very well. But what is “doing very well”, if I have a lot of dollar denominated assets, but I live in the totalitarian state that Farrington and Meyers speak of? What if the entire bitcoin community has been so focused upon the accumulation of financial capital, with the development of a world in which we want to retire as being left for another time. Unfortunately, along side this approach to saving finances for a future, it is all the time necessary to operate within the existing world, paying taxes, and completing fiat duties, while receiving fiat levels of product and service quality. Jeff Booth often says (I paraphrase somewhat), by remaining part of the system, you are feeding it, and of particular concern for me at that moment, is the longer I stay, the more time they have to learn about me and my assets.

This is where it struck me, attention is being given only to the financial asset, the gold 2.0 narrative, the store of value. Similarly, the economics journals love to write about bitcoin bubble characteristics or correlation with different assets, but less attention is given to the qualitative, social characteristics of bitcoin. Alongside the financial asset, there is an important social, medium of exchange aspect to bitcoin, meet ups, engagement online with like minded individuals and even peer-to-peer trade. While not ground-breaking, saying that, it was an enlightening realisation when it struck me that bitcoin is trust less money, but I still need to trust that Madex, Cryptocloaks, Start9, Ben Justman or Coinkite (amongst others) will send the products that I paid for, peer-to-peer, trustlessly. And in one short moment, bitcoin doesn’t only represents one form of financial capital, but is located within a broader more complex networks of social connections and relationships that one day may make up an “in real life” community. When the fiat value of bitcoin reaches by fiat mine escape velocity, I’ll need somewhere to do, inhabited with people I can relate to, with trades and skills that I am able to exchange peer-to-peer. Unfortunately, Wall Street (and other fiat brains) have so far focused upon the ability of the asset to store value, without understanding that Bitcoin the network is what gives the asset its value. It is not gold 2.0, a digital store of value, but a medium of exchange through time (H/T @KnutSvenholm).

Bitcoin is not the only capital we need to be accumulating

A comment that I initially thought was amusing, began to land more heavily recently, if we don’t do this right, and bitcoin remains primarily the small blocker’s dream of an economic asset, in people’s pensions and on company balance sheets, we may be rich, but we might in fact be Rich and Depressed (Cheers @Natalie and @PeterMccormack, but it may have originally been coined by @HODL) potential that we’ll be depressed because we might have everything we thought we wanted, riches, in my case, a shiny new bicycle, maybe a Porsche (late nineties obviously), but no one to enjoy it with. This may sound slightly dark and unpleasant, but I’m not talking about the guy living in his mother’s basement, who mined bitcoin in 2012, but a normal guy/gal, pursuing their own path of individual sovereignty, but forgoing the accumulation of social capital along the way. While on the surface, this may be viewed as heading down to the pub with your friends or having a meal with the extended family, then magically convincing them all they need to join you on your journey of bitcoin discovery. But as many attest, this is a difficult process, there is a lot of resistance. What I actually mean is slightly wider, and making those connections more broadly, with people who are already accepting bitcoin, people you have listened to on podcasts, helping others open to new idea to see the value in bitcoin, who may have services you value. Spending sats and putting time and effort into developing and accumulating social capital with a range of these individuals builds the village that can service your bitcoin citadel.

At this point in time, this may be viewed as slowing your ability to reach your stacking goal (of the financial asset), but could instead be viewed as a longer term, indirect investment into the future bitcoin world you want to live. Without building strong social capital with a range of capable individuals, when it is time to move on, whether to a villa in Portugal or a farm in North Wales, if there were a range of individuals you were able to invite to join you, it would likely be a lot more enjoyable. At a simpler, smaller level, such connections could also be made through the development of connections within local meet-ups, where it may be possible to attract trades people who may be willing to accept bitcoin to rewire a fuse box or maybe fix a leaky toilet. Without this attention away from the ETFs, the bitcoin treasury companies or Iran using bitcoin to evade sanctions, we will miss a key innovation of bitcoin, peer-to-peer electronic cash. We are able to pseudonymously exchange value with an individual anywhere in the world, but also within a group of individuals who may have similar views on how they want to see the world develop. Roger Ver may have been early and wrong with his solution of bigger blocks, but on the right line of using bitcoin to commerce and as an offshoot, the development of more social capital and less rich loners (not only because of the value of BCash).

Without giving attention to the accumulation of social capital, both to support the access of valuable resources (for innovation), but also richer, deeper bonds that may even create environments similar to the more tradition “community”, where you feel safe letting your children play out late. While I am a willing student of Ayn Rand and a staunch opponent of national socialism, the investment in the development of a local community appears incredibly important and something I miss from my childhood. I don’t want to send my hard-earned money, to a faceless tax collector who, following their own wage will guide the money to a national slush fund to pay the Netflix subscription and McDonald’s happy meal of a down and out. Within the context of a more traditional, bitcoin-oriented community, given it would likely be inhabited by individuals of means, the need to a form of social security would be limited. But saying that, within such a community, as was traditionally the case, when there was a need for charity, that may itself include aspects of education, developments, or community activities, rather than being funded by some overarching, coercive, inefficient, centralised body, could be driven by bottom-up demand and resources.

I for one, don’t want to be Rich and Depressed

This usefully references back to the beginning of this short essay, where bitcoin provides an elixir for the totalitarian oppression of nation state governments who enforce the use of THEIR currency for transactions and tax payments. Their efforts are to control, and wherever possible, suppress the accumulation of social capital that would potentially remove their powers. To again reference Jeff Booth, if we use their money and pay their taxes, we are complicit in their growth and further extraction of our effort, ingenuity and time on this earth. Apart from the necessary nation state armed forces, an honest and forthright constabulary and the judicial system to enforce and uphold law (specifically property rights), there is not much more a state need to be involved in. If the levels of taxes were not so great and the value of our money was increasing overtime, there would then be sufficient resources for individuals to have spare time and assets to invest in contributing to the social fabric of a country. Rather than individuals pursuing politics for a comfortable salary beyond their own ability, it would be a choice to contribute to the building of a nation without concerns related to the subsequent election cycle if their decisions went again those of their constituency.

While this is slightly off the topic by looking at things at a national level, by keeping things local and bitcoin based, the opportunities for small self-contained communities appears possible. Without the need to be subservient to a nation’s ever inflating currency, (at least partial) independence can be reclaimed, with both within and external trade being facilitated by bitcoin. This process may not have to be completely covert, but as a community, actively managing practices to ensure legal taxes are paid could prevent the coercive arm of the law. The difference existing and moderate taxation, combined with any potential price appreciation, could be resources allocated at a local level to create hubs of interests or innovation, activities for various groups, learning and education, shops and services, in short, a community rich in social capital, away from a totalitarian state attempting to destroy it. Within this future, bitcoin is not simply gold 2.0; gold failed because it wasn’t practical medium of exchange, bitcoin is also not simply a medium of exchange; if it has no value, what are you exchanging? Bitcoin is both; using it for both purposes along with a healthy dose of social capital reconciles to two sides of the Blocksize War, and hopefully allows us to move forward.

The terrifying risk is that without this, individuals (normies) continue to pursue the accumulation of ever more worthless dollars, pounds or yens, working ever more hours, to buy ever smaller houses to raise ever fewer children. As both time and financial resources get pinched, so too does the time available for social activities in what is known as a third space, where one gets to unwind after work, not simply with your ever smaller family. While now over 30 years since it was first published, Robert D. Putnam’s “Bowling Alone” documents the decline in social capital within the US, which has likely accelerated since the time of publishing. While we may all have a pastime, outside bitcoin podcasts, their enjoyment and the longevity of that enjoyment will likely be dramatically improved if there are others around us to enjoy the pastime with. Yes, I look forward to being rich enough to buy a new, British made mountain bike, and also having sufficient free time to ride that bike, but unless there are some people to come along for the ride, I can’t help but see myself getting a little depressed. Put another way, who wants to purchase a fine, high altitude, natural wine and then enjoy it by yourself.