In 2008, cyberlibertarian pundit and technology consultant Clay Shirky published Here Comes Everybody: The Power of Organizing Without Organizations, a book crammed with Silicon Valley bromides about Wikipedia, open source technology, and “democratization.” Premised largely on fantastical thinking, Shirky’s book touts the spontaneous birth of new “organizations” from the internet—beyond the mainspring of traditional organizational forms—the bulk of which unquestionably work for the good of society. Shirky’s basic presumption is loud, proud, and untested: anti-institutional and frequently leaderless organizations, those that today we hear more commonly described as “horizontal” or “decentralized,” are better for society than their more decrepit precursors.

To the contrary, much of what democracies, civil societies, and even corporations (for-profit and nonprofit) work toward is embodied in institutions that are precisely what Shirky means by “organizations”: not just companies, but legislatures, courts, regulatory bodies, unions, the media, and much else of the foundational strata on which society rests. In Shirky’s narrative, these organizational forms, which he and others deride as staid “incumbents,” have no choice but to get out of the way of technological inevitability. And this unstoppable flow of creative destruction, Shirky assures us, will be good for democracies; never mind that democracies mostly are collections of institutions built out of the will and consent of the governed. Digital technology, Shirky says, will free us, like it or not, from the institutions we built expressly to ensure what most of us thought was freedom.

Shirky focuses doggedly on what he construes as positive examples of anti-institutional organizations. Yet were he willing to take his own analysis more seriously, he might find a number of negative cases, especially those that derive their power and longevity from digital technologies: the various social media recruitment techniques used by ISIS and other violent groups; the widespread use of purportedly pro-freedom secrecy technologies that sustain worldwide networks of human trafficking and child pornography; the proliferation of dissenting sects, often leaderless, that proffer contrarian “wisdom” about climate change, vaccines, autism, alternative medicines—as well as far-right ideologies. (These would include even such high-profile efforts as Peter Thiel’s fellowships for smart people who deliberately thumb their noses at the very idea of higher education.) All told, digital technology has proven to be a remarkable booster for the baleful forces that democratic institutions were built to contain.

As “money,” Bitcoin fulfills essentially none of money’s functions; as “currency,” its massive volatility has made it all but unusable.

Bitcoin—and the blockchain technology out of which Bitcoin was built—serves as an especially forceful expression of the strong anti-institutional and anti-democratic bias hard-coded into our digital infrastructure. Leaderless, “distributed,” “decentralized,” resistant to empirical fact, larded with conspiracy-mongering disdain for what it variably refers to as “mainstream” or “bankster” propaganda, and yet simultaneously tied to the great profit-making and profit-extraction machines at the center of the world’s financial capitals, Bitcoin exemplifies the anti-institutional organization Shirky celebrates. Yet for the most part, its alternative structures and operating motives are distinct steps backward from what it claims to replace. First mooted as “money,” Bitcoin fulfills essentially none of money’s functions; next billed as “currency,” its massive volatility has made it all but unusable; pitched as an alternative to the putative “theft of value” caused by “inflationary” official money, it has revealed itself to be the most inflationary (and deflationary) instrument ever to trade widely; venerated by its followers as a rebuke to the malfeasance of Wall Street, it has succumbed to its own hostility for regulation, betraying a propensity for fraud and manipulation that begins to rival what investors encounter in traditional financial institutions. While an individual buying listed stocks or mutual funds from the New York or London stock exchanges is highly unlikely to be affected by “pump and dump” schemes and other forms of market manipulation, analysts have argued repeatedly that all cryptocurrency trading is saturated with it. Recent reports indicate, for example, that an early spike in Bitcoin value from $150 to $1,000 in 2013 was engineered by a single trader; that the already-very-shady market in Initial Coin Offerings or ICOs is riddled with pump and dump schemes; and that the major cryptocurrency exchanges are heavily manipulated by the issuance of “tethers,” a privately issued token that has been unable to certify its value and that analysts suspect may account for up to 80 percent of the current Bitcoin value, and in turn the value of other cryptocurrencies.

During its rise, Bitcoin has taken the shape of one justly maligned form of “incumbent” organization: the religious cult. Like many digital anti-institutional organizations, Bitcoin hollows out the practices of what had already been a massively corrupt and dangerous organizational form—that is, an organized cult like Scientology—and replaces them with remarkably thin simulacra. To begin with, the language used to maintain belief in Bitcoin is viciously circular, self-justifying, wildly metaphorical, and difficult if not impossible to link to fact. And as with many cults, those selling this gospel most vociferously are also those who stand to profit disproportionately from its acceptance—an interest they fail to disclose in their evangelism.

Unlike traditional cults, though, Bitcoin has no specific creed, no single geographic location, and no truly identifiable belief system—other than Bitcoin itself. To believe in Bitcoin is to believe in Bitcoin; adherents can articulate little more than this, beyond the flimsy notion that belief will redound to the ultimate benefit of the believer.

Absentee Godhead

Cults typically have leaders. But digital utopians fetishize “leaderless” organizations, often without being able to explain, let alone provide evidence for, the superiority of leaderless groups. Here is where Bitcoin, and blockchain technology more generally, arrive at a fitting paradox: they both do and don’t have a leader.

That non-leader’s “name” is Satoshi Nakamoto. Nakamoto is the author of “Bitcoin: A Peer-to-Peer Electronic Cash System,” a paper released to a cryptography email list in late 2008. The first to describe the blockchain software and Bitcoin token, the paper has retroactively cast Nakamoto as the “inventor of Bitcoin,” an appellation that might be deceptive considering the technology is built on the work of many other software developers, particularly in the cryptographic and crypto-anarchist movements, who had long sought a source of digital cash—and who had vetted several other candidates prior to Bitcoin. Soon after the paper was released, Nakamoto created a repository for the Bitcoin source code on the open source software development platform Sourceforge.net. He was the first to run the software, and his initial entry in the blockchain became known, without irony, as the “genesis block.” The software quickly spread, and Nakamoto’s own public Bitcoin address soon accrued a large volume of Bitcoin. He is currently estimated to own about 1 million Bitcoin, which, if priced at the recent valuation of around $10,000 per coin, would make him a remarkably wealthy man.

“Nakamoto” wrote more than five hundred messages on forums on bitcointalk.org, a domain he registered, through late 2010. He used a variety of techniques to certify that the message poster was in fact the same person who had written the founding document—and who was then running the Bitcoin software. Through mid-2010, Nakamoto had been the lone person with access to the Bitcoin software repository on Sourceforge, and thus did all or most of the direct development of the code himself. Around that time he handed control of the repository to Gavin Andresen, a software developer who eventually went on to found the Bitcoin Foundation. Then, for all intents and purposes, he vanished.

Since its early days, conjecture as to Nakamoto’s true identity has been one of the galvanizing forces within the Bitcoin community. And few circumstances could have bolstered the “distributed” and “decentralized” mythology of the cryptocurrency better than a leader who seemed to oscillate in and out of existence, whose identity is likely fictitious. In Nakamoto’s profile at the P2P Foundation site, he claimed to be a Japanese man born in 1975—yet few in the community believe the story to be true. Eventually, the riddle made its way to the broader media, which now conducts the occasional, often fruitless investigation. The most famous of these was a March 6, 2014, Newsweek cover story by Leah McGrath Goodman, which identified a retired Japanese American systems engineer named Dorian Nakamoto—whose birth name is Satoshi Nakamoto—as the Bitcoin inventor. That identification is now generally considered unlikely; in any case, Nakamoto seems to have genuinely misunderstood a question Goodman asked him about Bitcoin because he, like many in 2014, had not heard of the cryptocurrency.

Other candidates have been named, including several senior members of the crypto-anarchist and Extropian communities—such as Nick Szabo, a cryptographer, computer scientist, avowed right-wing libertarian, and the inventor of so-called smart contracts, and Hal Finney, a cryptographer, cypherpunk, Extropian, and cryptographic activist who did important early work on blockchain technology, and who died in 2014—because those communities have the longest track record with cryptocurrency. One man, the Australian academic Craig Steven Wright, claimed in late 2015 to be Nakamoto himself, producing just enough evidence to convince a faction of the community’s followers. But Wright, in the end, was unable to substantiate his claim through the most obvious method: moving some of the coins in Satoshi’s Bitcoin wallet. Still others, in keeping with Bitcoin’s heterodox vision of decentralization, suspect that Nakamoto’s identity is the work of a group of developers rather than a single individual.

Nakamoto thus emerges as a remarkably enigmatic figure at the heart of the Bitcoin phenomenon, if he can even be called a figure at all, since his existence consists entirely of a brief research paper, some software, several hundred message board posts, and an immense store of Bitcoin that he has never touched. His somewhat conspiratorial beliefs about central banking and “fiat” money do not distinguish him much from his peers in the crypto-anarchist community (other than that he displays little personality). Yet the fact that his massive stash of Bitcoin remains unspent gives Nakamoto the appearance of a wholly ascetic, Buddha-like interest in the cryptocurrency theology. Still, we have no way of knowing if Satoshi in his real identity or identities might have a personal stake in the cryptocurrency by way of other stashes. Should he release his Bitcoin from the huge store of accumulated tokens, it is well within the realm of possibility that it could negatively affect a perilously thin trading market.

Church of the Double Jesus

The religious and cultish behaviors manifest throughout the Bitcoin and blockchain communities are sometimes noted by critics, but they are just as often celebrated by its enthusiasts. The Bitcoin Wiki itself describes a “Church of Bitcoin,” one that was “founded on October 25th[,] 2012[,] in order to grant Bitcoin users a non regional spiritual outlet and to escape oppression by existing religious groups.” Billed as “satire,” its eleven commandments include transparent, even juvenile witticisms, like “thou shalt not fork thine own family” and “troll harder.” (The website for the “church,” bitprayer.com, no longer exists—if it ever did.) Still, this painful-to-read stab at self-parody does little more than ironize the religiosity found in the circular “belief in Bitcoin.” A slightly less satirical, if no less revealing, take can be found under the moniker “Church of Satoshi,” which promotes a “religion” called “Satoshism.” Their Twitter account, @ChurchOfSatoshi, was largely active in 2014, and describes itself as “dedicated to teaching faith in decentralization & cryptography as a first amendment protected right.”

Even as Bitcoin has an absentee Godhead, the community sports not one but two contenders for the role of “Bitcoin Jesus.”

The arrival of these churches is not much of a surprise: from nearly the beginning, and even more than other technology advocates, cryptocurrency adherents have been referred to as “true believers.” Consistent with the hollowed-out quality of cyberlibertarian faith, exactly what a “true believer” in cryptocurrency believes is not at all clear. For many, it is incontrovertible that Bitcoin or the blockchain or another cryptocurrency will “succeed,” yet the terms of that victory differ markedly for one believer or another. To some parties, “success” means only what outspoken Bitcoin critic David Gerard has rightly referred to as “number go up.” In many cases, this belief is as cynical and self-serving as any prosperity gospel, not in the least because it depends on setting up a succession of Bitcoin holders to lose significant funds in order for others to flourish (a.k.a. the “greater fool theory”). Of course, it is a matter of faith for many believers that Bitcoin’s price will rise asymptotically, forever. That Bitcoin’s own price performance, to say nothing of other cryptocurrencies, already shows how unlikely this is constitutes another of those pieces of empirical data that is outside the bounds of Bitcoin’s cult rationale. The “currency” routinely goes down by 10 percent or more in a single day, and has several times lost more than 50 percent of its value without retracing those gains for many months; Bitcoin indicators such as bitvol.info typically give its volatility as significantly greater than that of the U.S. dollar.

But even as Bitcoin called forth its absentee Godhead (Satoshi) to fill its imaginary churches, it still lacked a crucial fundament. Bitcoin, in other words, needed a Jesus. Remarkably, the community sports not one but two contenders for the role of “Bitcoin Jesus.” One, Roger Ver, is an anarcho-capitalist expatriate, originally from Silicon Valley, who in 2002 served ten months in Federal prison after pleading guilty to selling explosives without a license. Later, in 2006, Ver relocated to Tokyo, and in 2014 he renounced his U.S. citizenship and became a citizen of Saint Kitts and Nevis, a notorious tax haven that inducts economic investors into a program called “Citizenship by Investment.” Ver was an early investor in Bitcoin, even a founding member of the Bitcoin Foundation, and by 2013 he had apotheosized to the status of “Bitcoin millionaire.” In a 2013 interview with CNBC, Ver explained how he came to be called “Bitcoin Jesus”:

I believe Peter Vessenes [chairman of the Bitcoin Foundation] gave me the title when we were at a BBQ together. I was explaining bitcoin to about two dozen high school kids. The kids were all enthralled by bitcoin, and hanging on my every word. . . . Peter then commented that “it’s like you are a Bitcoin Jesus, and you have all your disciples around you.”

In a 2016 Denver talk to Bitcoin investors, Ver expressed disdain for his anointment, noting that, as an atheist, he didn’t pick the name for himself. What’s worse, Ver added, “things didn’t turn out so well for the original Jesus, who was murdered by his government for being an activist.” In the end, Ver relinquished his Christly burden and supported a fork of the Bitcoin blockchain in August of 2017. It resulted in the creation of a new cryptocurrency, Bitcoin Cash (BCH), which supporters of the original Bitcoin predictably considered apostasy.

This apostasy may have led to yet another minor schism, as well as the elevation of a new Bitcoin Jesus: longtime Bitcoin advocate and consultant Andreas Antonopoulos, who is also the author of Mastering Bitcoin and The Internet of Money. On December 5, Ver himself tweeted that “Andreas is one of the most eloquent speakers on the topic of Bitcoin, but if he had invested even $300 in Bitcoin back in 2012, he’d be a millionaire today.” The accusation is fairly straightforward: Ver alleged that Antonopoulos did not support BCH because he failed to make himself rich with Bitcoin. Antonopoulos himself has, true to ascetic form, noted that he had only recently climbed out of debt, and that he survives mostly on five-dollar donations from Patreon supporters. Antonopoulos’s modesty, not to mention his emergence from the desert of penury, more than satisfied those angered by Ver’s support for BCH. Suddenly, Antonopoulos was ordained the new “Bitcoin Jesus” by a flank of supporters, some of whom banded together to donate around fifty BTC to him—making him a millionaire overnight. If the precise theological role of Bitcoin Jesus had been somewhat murky, it now became much clearer: the point was to get rich quickly.

The economic framework on which cryptocurrencies depend emerges from right-wing and often anti-Semitic conspiracy theories about the nature of central banking.

The unhealthy yearning for a Bitcoin Jesus exposes yet another cultish aspect of the Bitcoin community: the sectarianism of minor differences. This much can be illustrated even by its dimly self-aware, mildly satirical commentators. One such commentator, an “angel investor” named Filip Martinka, wrote a Medium blog post in 2016 titled, “Why Bitcoin Is a Religion.” Couched in jargon he claims to have borrowed from Jungian psychology, and lavishly illustrated with Christian iconography modified for acolytes of the blockchain, Martinka offers the noble suggestion that “cryptocurrencies function as distinct religious beliefs.” It’s notable that there are over one thousand such currencies as of this writing. The open source community is itself deeply invested in the notion of a “software fork”—when two groups of developers take a project in separate directions—as a kind of interpersonal truce that dissolves strong disagreements in the waters of noninterference. Bitcoin Cash, an example of such a fork, resulted in individuated versions of the Bitcoin software, as well as separate tokens (the “original” Bitcoin, with the symbol BTC, and the new Bitcoin Cash token, BCH). (The split occurred because some in the Bitcoin network have turned out to have problems both with the speed and volume of transaction processing, which BCH was meant to address, but that fork has so far been accepted by a minority in the Bitcoin community.) So while Ver may have had his Bitcoin Jesus title revoked, so to speak, by BTC partisans, he nonetheless retains it for supporters of BCH; and Antonopoulos now guides BTC through the wilderness. The lesson here is common to sectarian schism: what to outsiders might appear as microscopic differences in belief can, to members of a religious order, entail outsized levels of anger and acrimony. Still, in the religion of the blockchain, it may now be the case that BTC and BCH do represent separate houses of worship—among potentially hundreds of growing congregations competing for new members.

Language Games

For his part, Martinka more precisely registers Bitcoin as more cult than religion. In doing so, he points to an important checklist of “Characteristics Associated with Cultic Groups, Revised,” published by the International Cultic Studies Organization. Martinka interprets several of these characteristics fancifully (suggesting that “long-term coding is very much a tantric, mind-altering endeavor,” for example); others, he argues, literally occur in Bitcoin communities, and with regularity. These include “zealous and unquestioning commitment” to its leader; the group’s tendency to be “elitist,” and to claim “a special, exalted status for itself”; a noticeably “polarized us-versus-them mentality”; and the belief that a “supposedly exalted ends justify whatever means it deems necessary.”

There is value in Martinka’s argument, though he leaves at least one thread dangling. It turns out that the checklist he relies upon was written by two prominent researchers into cults, the clinical psychologist and author Michael D. Langone, and the sociologist Janja Lalich, whose work in particular is useful for understanding Bitcoin. In her 2004 book Bounded Choice: True Believers and Charismatic Cults, Lalich draws on the concept of “bounded rationality” from Herbert Simon, an economist and psychologist who uses this concept to describe situations in which “limited resources . . . prevent us from having access to all the information or knowledge relevant to a particular problem.” Lalich expands and adapts this notion of “bounded choice” to cults, wherein “free will has not been taken away, but it has been restricted and distorted.” “Behaviors or actions that might look crazy or irrational to the outsider,” Lalich writes, “look completely rational from the perspective of the person inside the bounded reality of the cult.”

The Bitcoin and blockchain communities are very much structured by distributed versions of Lalich’s bounded choice. The interpretation of certain core terms, for example, is prescribed in such a way so as to foreclose their ordinary dictionary definitions, and then to license their continued use in the specialized cryptocurrency lexicon. Words become totemic, exerting an ideal power that belies any attempt to check their meanings against empirical evidence. So, for example, cryptocurrency promoters routinely advertise their wares against what they call “fiat currency,” which they deem so volatile that merely holding it might result in the loss of one’s life savings. In reality, it is well beyond Bitcoin’s bounded rationality to look at Bitcoin’s own volatility statistics and compare them to those “fiat currencies,” since any such comparison would show exactly the opposite of what the Bitcoin religion tells us. Meanwhile, ordinary economic definitions of money—especially the well-known concepts of store of value, medium of exchange, and unit of account—are rejected and even scoffed at, while at the same time we are told that Bitcoin is money. (That is, those who define what money “is” must be woefully misguided.) “Store of value,” in particular, is reinterpreted from its contemporary meaning—a token that is reliably worth the same tomorrow as it is today—into something that is nearly its exact opposite, a token that may conceivably skyrocket in value in a short period of time.

The Priestly Class

Bitcoin discourse is saturated with conspiracy theory. As I discuss in my 2016 book The Politics of Bitcoin: Software as Right-Wing Extremism, the entire economic framework on which cryptocurrencies depend emerges from right-wing and often anti-Semitic conspiracy theories about the nature of central banking (especially but not only the U.S. Federal Reserve), the use of precious metals as standards for currency, and the nature of inflation. Right-wing conspiracy theorist and radio host Stefan Molyneux, just to take one example, gets hundreds of thousands of views on Bitcoin videos on which purportedly non-conspiratorial Bitcoin evangelists like Antonopoulos appear, giving credence to Molyneux’s crackpot political “theories.” Molyneux has himself been accused of being a cult leader; his attacks on families of origin (to which he refers by the acronym FOO, to which he counterpoises a process of “deFOOing”) have led at least one family to hire a cult expert and therapist to help try to extricate their adult son from Molyneux’s grasp.

More generally, the Bitcoin project is built around the related notions of “decentralization” and the “elimination of middlemen” that is itself conspiratorial and rooted, in sometimes surprising ways, in far-right thought. Scholars like Philip Mirowski have noted the significant overlaps between the rhetoric of decentralization and Friedrich Hayek’s promotion of the market as a master computer, a knowledge-generation machine that always surpasses the human capacity to know. And humans, Hayek claims, only have access to this market-computer’s store of knowledge in defective and indirect form, via individual prices for goods, services, and labor.

In the Bitcoin and blockchain world, a version of this doctrine emerges not directly from a personally charismatic leader, but instead from the tight discursive networks and communities that surround software development. Satoshi is totally unknowable except by his works. Yet he does not lack for explicators, and those explicators do not lack for specific personal reward from promoting what they take to be his gospel; and as in cultic systems, that gospel is framed around rejection of empirical evidence and the promotion of alternative forms of explanation that very much conform to Lalich’s theory of “bounded choice.” There is no reasoning with Bitcoin believers: skepticism is reframed as envy, data is reframed as opinion, and history is often revised.

Consider, for example, the persistent observation, made when the price of Bitcoin or another cryptocurrency rises quickly in value, that such flashes indicate a bubble. In financial terms, a “bubble” refers (in the words of the mainstream investing site Investopedia, for example) to “an economic cycle characterized by rapid escalation of asset prices followed by a contraction,” wherein “a surge in asset prices [is] unwarranted by the fundamentals of the asset and [is] driven by exuberant market behavior.” Tellingly, in the case of Bitcoin, this rubric is thrown into disarray, for the reason that it is virtually impossible to determine what the “fundamentals” of Bitcoin are or should be. (“Fundamentals” is the term used in finance for the underlying economic factors that help to determine an asset’s price: the most familiar example is corporate earnings.) Commentators from across the spectrum, to be fair, have offered a variety of proposals for Bitcoin’s fundamentals, but at the very least we have to agree that there is no consensus candidate, as there would be for a publicly traded stock, where the earnings per share of the company form an important if penetrable floor for asset prices.

Others have argued, convincingly in my opinion, that Bitcoin and other cryptocurrencies have no fundamental value whatsoever. In either case, the fundamental value of Bitcoin is far from determined, even as its violent swings in price are impossible to ignore. An asset that surges in value by hundreds or thousands of percentage points in a brief period is, by any reasonable definition, in a bubble—with the possible exception that its underlying fundamental value somehow experienced those same fluctuations.

It is central to the promotion of Bitcoin as a speculative asset that, even when it surges and plummets in price, its status as a “bubble” must be dismissed.

But it is central to the promotion of Bitcoin as a speculative asset that, even when it surges and plummets in price, its status as a “bubble” must be dismissed. It isn’t hard to see why: anyone holding Bitcoin wants it to go up in value. If Bitcoin is bubble-prone, many rational investors will avoid it. And Bitcoin’s volatility should be a reason that people avoid it. In fact, without a clear fundamental value, Bitcoin looks suspiciously like a Ponzi scheme, or what one writer has called a “Nakamoto scheme,” wherein current holders are dependent exclusively on other buyers coming along in the future to pay ever more inflated prices for the same asset.

Whenever there are asset bubbles, those with a stake in those assets tend to offer two potential justifications: either the fundamentals justify inflated prices or “it’s different this time.” The first may sometimes be reasonable: a person who bought Amazon or Apple stock at the height of the dot-com bubble, and continued to hold it through the subsequent collapse, would today be pleased that she had done so. Yet the number of dot-com companies for which there was even a marginally reasonable story about company fundamentals were by far the minority; the others fell back on “it’s different this time.” If there is one iron law in financial circles, it is that when many people are saying “it’s different this time,” it very likely is not.

But cults tell their followers to disbelieve what their friends and families say, on the basis that the cult itself has exclusive access to true wisdom. As we well know, it’s a lie the leaders tell to enrich themselves. Bitcoin may not have leaders, exactly, but it has more than enough falsehoods and self-dealing promoters to fleece multitudes of their savings. That it does so in the name of some kind of upside-down “freedom” from “institutions” only exacerbates the damage it is capable of inflicting.