Bitcoin Is Antifragile: It Gains From Disorder

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There has been a lot of FUD (fear, uncertainty and doubt) concerning the cryptocurrency space recently.

In this post I would argue that this is probably good 'news' for Bitcoin (and other cryptocurrencies).

One of the thinkers that has influenced me the most in recent years is Nassim Nicholas Taleb.
He was a former option trader that made a fortune by taking small bets against the market, and retired at an early age. He has since then become one of the world most influential philosophers.

Most people intuitively get that a vase of flowers is fragile and a rock is solid.
But what is the opposite of fragile?

In the groundbreaking book Antifragile: Things that gain from disorder he argues that the opposite of fragile is anti-fragile.

If something is antifragile it gains from disorder.
Human bones are antifragile (to a certain point): They get stronger if we use our body.

Antifragile is a must read, and I have tried to simplify the lessons learned as much as possible.

Bitcoin and Antifragility

Now we know that an entity can be fragile, robust or antifragile.
Centralized entities are fragile, while decentralized entities are antifragile.

Fragile: Centralized state, Modern banking system (fiat)
Robust: Gold
Antifragile: Free city state, Bitcoin, Silicon Valley (stay hungry, stay foolish!)

Benefits of fragile things are often small and visible, and the side effect potentially severe and invisible in the form of negative events (Black Swans).
Fragile things are vulnerable to uncertainty, unknowns and time.

Antifragile things gains from uncertainty, unknowns and time (love volatility!).

You cannot really say with any certain reliability that a certain even or shock is more likely than another,
but you can state with a lot of confidence that an object or structure is more fragile than another should a certain event occur.

The modern banking system is very fragile, and need to be bailed out from time to time, costing the public loads of money,
while the banking system continues as nothing has happened.

People that promote centralisation and top-down management are the fragilistas.
A fragilista believes that what he doesn’t see, or what he doesn’t understand, doesn’t exist.

Take the example of Jamie Dimon: He is a fragilista.
He is an intelligent man (believe it or not) so why does he say that Bitcoin is fraud?

He does not the understand bitcoin, so it should not exist, thus it is a fraud.

Some personal lessons

Try to live your life where you expose yourself to as much antifragility as possible.

Modify exposure to events.

Do not try to become rich, but try to have soul in the game.

Less is more!

You become more antifragile if you take things away (remove debt, quit smoking, spend less etc.)

Conclusion

In my opinion Bitcoin is very antifragile: It is decentralized, gains from unknowns, uncertainty and time.
Thus, the only way Bitcoin can become irrelevant is if the banking system becomes antifragile too.

If the conclusion is that FUD makes BTC stronger, I would just say: Bring it on!