An evolutionary explanation of why taking true self-custody of one’s property will be a defining process of the 21st century, and a quick guide on how to do so.
Those who love peace must learn to organize as effectively as those who love war.
― Martin Luther King Jr.
Why was Bitcoin created?
Bitcoin was created to serve as a digital form of money which does not rely on any institution or outside entity. When used properly, one can have the equivalent certainty of using a spectrometer to verify their gold’s purity before it is hand delivered, and vice versa. This is the essence of the Bitcoin mantra, “Don’t Trust. Verify”. Those who use Bitcoin according to its foundational design, meaning they run their own full node and have generated their own private keys, have the ability to fully audit and confirm the validity of their holdings and transactions.
Further, when used according to this foundational design, Bitcoin is both a novel iteration of free speech, and property rights. The former as it mathematically transmits censorship resistant values, and the latter as the private-key holder has direct ownership and control of their asset. For more information on these mechanics, see “How does Bitcoin work?” section of Gradually, then Suddenly, Bitcoin Fixes the World.
Building a Road
“Energy expended per block [through Proof-of-Work] not only secures the UTXOs [transactions] belonging in that block but also retroactively secures all global UTXOs that occurred in past blocks. The reason for this is because it would be impossible to revert past UTXOs without reverting the current block first. Each new block effectively “buries” all existing UTXOs under it’s weight.“
– Hugo Nguyen
One can visualize the growing Bitcoin network’s value as the construction of a sturdy cobblestone road, where each stone represents an amount of Bitcoin that is held with the intention of never selling back into fiat dollars. As each new participant enters the network, does their homework, and moves their funds to self-generated private keys, the stones at the start of the road are packed more tightly and securely together, providing a sturdy foundation that can weather increasing chaos and traffic. Over time, as more and more people join the network, the road gets both stronger and longer, translating to increased security and attack-resistance, along with an increased price level. (Layered solutions such as the Lightning Network can be seen as a highway overpass, allowing for faster (near instant) transaction settlements, while still being based on and constructed off the stable cobblestone.)
With all this said, the construction of a new road, one that can bridge humanity to a new paradigm of abundance and peace, stands in stark contrast to the Military-Industrial-Complex’s necessary goal of continued death and destruction – and one should expect that every trick in the book will be pulled out to halt its momentum.
Society vs. State – An Evolutionary Dynamic
“Necessity is the mother of invention.” One could say that Bitcoin’s invention was born out of an amalgamation of hundreds, if not thousands of years of strife between the “State”, or the institutions and elites that control them, and greater “Society”. The omnipresent State’s power comes directly from these top-down institutions, which command huge resources but are controlled by very few. On the other hand, society’s power is drawn from the bottom-up, containing the majority of humans who are then able to act, invent and communicate in a manner far more decentralized than a centrally-planned state.
This continuous dynamic would be described by evolutionary biologists as “The Red Queen Effect” – drawing from the classic CL Lewis scene where Alice is running as fast as she can but staying in the same place. John Gribbon, in Deep Simplicity, gives an example of such a case with frogs and flies.
There are lots of ways in which the frogs, who want to eat flies, and the flies, who want to avoid being eaten, interact. Frogs might evolve longer tongues, for fly-catching purposes; flies might evolve faster flight, to escape. Flies might evolve an unpleasant taste, or even excrete poisons that damage the frogs, and so on. We’ll pick one possibility. If a frog has a particularly sticky tongue, it will find it easier to catch flies. But if flies have particularly slippery bodies, they will find it easier to escape, even if the tongue touches them. Imagine a stable situation in which a certain number of frogs live on a pond and eat a certain proportion of the flies around them each year.
Because of a mutation a frog develops an extra sticky tongue. It will do well, compared with other frogs, and genes for extra sticky tongues will spread through the frog population. At first, a larger proportion of flies gets eaten. But the ones who don’t get eaten will be the more slippery ones, so genes for extra slipperiness will spread through the fly population. After a while, there will be the same number of frogs on the pond as before, and the same proportion of flies will be eaten each year. It looks as if nothing has changed – but the frogs have got stickier tongues, and the flies have got more slippery bodies.
We can extend this concept to encompass the interplay between Society and the State – In order to dominate Society, the State uses a variety of means of surveillance in order to identify dissenters, and counteract influence through a variety of methods, including direct violence, persecution, and psychological-operations (psy-ops). In response to the increased surveillance and violence, Society has created encrypted technologies (most notably Bitcoin) far less susceptible to violence then previous tech. Under a Gold or Fiat Standard, one could be killed and their property taken, however when using Bitcoin, the value is inaccessible if the victim does not give up their private keys; direct violence is now less effective.
While the world may appear to be just as disorderly as ever, in reality, both the State and Society have created a deeper order within their respective paradigms, one based on fear, deceit, scarcity and death, and the other on truth, abundance, prosperity and life. The question now becomes, which path do you want to give your economic energy to?
One may be thinking, I have nothing to hide, I do not care if I am surveilled and have little privacy, however, this is a very slippery slope to self-censorship, where people begin to not speak the truth, and their minds, for understandable fear of unjust repercussions. A society under heavy surveillance inevitably ends up becoming one which punishes the innocent and allows the genuinely guilty to walk free.
If you think the State will not come for you and your fairly acquired property, look no further than Executive Order 6102 which was signed in 1933 by FDR and outlawed citizens to hold their value in Gold (or the current proposals from FinCen to regulate/prohibit full nodes and privacy practices). This is why it is critically important to take proper custody of Bitcoin holdings, as one could expect the current, opaque, short-cutting custodial solutions to private seed generation and storage to be among the first dominoes to falls under a more “war-time” and authoritarian government regime. If you were to go back to 1933 with this knowledge, would you rather secure your gold buried in your yard, and verified with a spectrometer – or at the whim of a institution holding and transacting with it on your behalf?
With all this said, when an organism’s adaptations no longer effectively act upon its environment – it goes extinct. If surveillance and violence no longer “work” because encrypted tech like Bitcoin and NOSTR exist, then there is inherent potential for Earth to leave suffering in the past, and usher in an era of peace and prosperity where all are truly equal in their ability to speak freely and own property.
Quick Guide to Key Generation
Tell me and I forget. Teach me and I remember. Involve me and I learn.
– Benjamin Franklin
- Use Dice to Generate Entropy
- Acquire 11 fair dice (each a different color, or 3 distinct colors will be useful). You could also flip coin(s), or less dice, but this will take far longer.
- For a 12-word seed phrase you need 128 bits of entropy (i.e. random data) – meaning 128 random 1’s and 0’s. Let dice which are rolled odd equal a 1 and dice rolled even equal a 0.
- Roll the dice, and record as follows. (Note: It is essential to roll dice and in a room with no internet connected devices (or any devices for that matter), and close your blinds as well!)
| Dice Roll | |||
| 1 | 0101 | 0101 | 001 |
| 2 | 0101 | 0101 | 001 |
| 3 | 0101 | 0101 | 001 |
| 4 | 0101 | 0101 | 001 |
| 5 | 0101 | 0101 | 001 |
| 6 | 0101 | 0101 | 001 |
| 7 | 0101 | 0101 | 001 |
| 8 | 0101 | 0101 | 001 |
| 9 | 0101 | 0101 | 001 |
| 10 | 0101 | 0101 | 001 |
| 11 | 0101 | 0101 | 001 |
| 12 | 0101 | 010 |
2. Calculate the Checksum
- The ‘checksum’ is an equation which makes sure you have not made any errors – this is how you get an instantaneous alert when you type your credit card information wrong.
- In order to calculate it, you’ll need an air-gapped computer (meaning no internet connection) running Linux, and type the following into the terminal. (Note: this can be done by hand, but is highly complex and painstaking). In the case of the example above you would type in:
- echo 01010101001010101010010101010100101010101001010101010010101010100101010101001010101010010101010100101010101001010101010010101010 | shasum -a 256 -0
- Here is an example of that output in a Mac Terminal, which is doing the same math, however is connected to the internet and thus not secure:
- The bottom line of the screenshot above is the hash output, which is expressed as hexadecimal values – meaning instead of displaying digits from 0 to 15, it counts up to 9, with 10-15 being represented by letters. Kind of like how playing cards work.
- Take the first value of the hash-output, in this case “6” and convert it from hexadecimal to binary using the chart below (if making a 24 word seed, you need 256 bits of entropy, meaning the checksum would require 8 more bits of data, thus you would convert the first two values of the hash output from hexadecimal to binary):
| 0 | 0000 |
| 1 | 0001 |
| 2 | 0010 |
| 3 | 0011 |
| 4 | 0100 |
| 5 | 0101 |
| 6 | 0110 |
| 7 | 0111` |
| 8 | 1000 |
| 9 | 1001 |
| A | 1010 |
| B | 1011 |
| C | 1100 |
| D | 1101 |
| E | 1110 |
| F | 1111 |
- As our hash output starts with 6, we get a corresponding binary of ‘0110’ which we then append to the end of the 12th string of binary which only had 7 digits.
- We are now left with 12 lines of binary, each with 11 digits each, which we will now convert to decimal.
3. Convert to Decimal
- To convert one line (11 digits) of binary to decimal, enter the following into the command line, replacing your binary with mine :
- echo “$((2#01010101001))”
- My rolls one through eleven
- echo “$((2#10010101010))”
- My twelfth binary string
- echo “$((2#01010101001))”
- These would get the following outputs:
- 681 and 1194
4. Match Values to Seed Words
- Use the following PDF containing the BIP39 wordlist, and match your decimal numbers to their respective seed word.
- In this example, the full seed phrase would be:
- “Festival Festival Festival Festival Festival Festival Festival Festival Festival Festival Festival Next”
- Note that this would be a valid seed phrase that one could use, however given that is not random, it would be highly susceptible to exposure.
5. Check Seed Phrase Validity
- In order to make sure your seed phrase is valid, meaning you calculated the checksum correctly, you can input it to this Mnemonic code converter. Ensure the code converted has been copied to your air gapped computer.
- Note: If you input into a mnemonic code converter that is internet connected (i.e. not on the air gapped computer) – then your seed phrase has been exposed.
6. Spot Check HWWs
- Finally, before we move any funds to this secure seed phrase we just generated, we want to spot check that our hardware wallet is truthful (i.e. not corrupted or tampered with).
- To do so, we will need 2 different hardware wallets (from different open source HWW manufacturers, I would recommend Coldcard, Bitbox, and/or Jade).
- By inputting our new seed phrase into both, and checking that the list of public addresses that both spit out are the exact same, we can be quite certain that neither device is corrupted, and thus that our self-generated seed is truly secure.
For those who need more direct help with this process, you can reach out here.