Kantian Ethics, Metcalfe’s Law and Bitcoin’s Network Value
Why do we so often use purely economic measurements as a reflection of worth or value?
The danger of such materialism is that it ignores the concept of intrinsic value. I believe that fundamentally each and every human being has his or her own self-derived consciousness and inherent self worth. Every day, every moment, each human is already a complete and worthy person with his or her own unique set of experiences and memories. Each person should be regarded as more valuable and more important than the sum total of their economic outputs. In short, human beings and the shared experience of human society should always, from an ethical viewpoint, be considered first and foremost above any economic considerations.
If we all attempted to build an egalitarian society in which all human beings can flourish and be happy, we all could benefit. If we all belonged to a society in which we recognized the intrinsic value of all of society's participants, we could thank Kant for keeping that torch of hope burning bright.
That being said, when you look out into our socio-economic order, you will discover a sharp departure from Kant’s ideas. If the U.S. ever considered the intrinsic value of human beings above or before their economic value, this attitude has since eroded away with time. Or maybe the idea never entered the collective conscience in the first place. Concepts relating to equality are certainly in our rhetoric and attitudes but have rarely been prominent in our economic policy.
To put a finer point on this argument, the US Office of Management and Budget puts the value of one human life in the range of 7 to 9 million dollars. Regardless of whether you think this number is too high or too low, the very act of quantifying the value of human life itself is a demeaning act and ignores the fundamental principle of our intrinsic value.
That being said, it is probably useful to quantify economic inputs and to figure out a way to distribute the value that's generated from those inputs in a meaningful and fair way. The way we do this must benefit both the individual creating the inputs and the society in which this individual exists. Not simply for ethical reasons, although this would indeed be more ethical. Ironically, recognizing Kantian ethics could also be beneficial for economic reasons. This would be a necessary component to any high functioning, efficient society which does not waste the potential contributions of a human. A human who might make society and civilization more improved as a whole were they genuinely included in the equation.
That, in turn, brings us to the concept of Metcalfe's Law, which states that a network's value is proportional to the square of the number of nodes in the network. That's just a fancy way of saying that the more people, or more specifically, the more connections people create inside of your network, the more valuable your network is. This value can be measured or quantified in a number of ways, but it is perhaps most astutely expressed by the market cap of the network or company managing said network.
For example, we can conclude that, in part due to Metcalfe's Law, Facebook's social network is worth over 600 billion dollars at the time of this writing. This, of course, isn't an exact reflection of the value demonstrated by Metcalfe's Law. It is because you must also consider the intellectual property, organizational execution, market positioning, and market-based factors of Facebook as an organization. Before you can safely arrive at the market's conclusion that Facebook's network is worthy of a 600+ billion USD market cap.
Thankfully, a more direct 1:1 demonstration is available in the market cap of most available cryptocurrencies. We know, for example, that Bitcoin’s network is worth precisely $169,053,459,272 at the time of this writing. This is impressive since there is no “Bitcoin Corporation” that owns and siphons value from the network. This market capitalization, then, is a very accurate reflection of the value of Bitcoin’s user base and ecosystem players’ interactions. Most notably, their interactions occur on the various exchanges and gateways which allow users to buy and sell Bitcoin with one another. It's from this dynamic which emerges Bitcoin’s daily trading price average, which we could then use to determine its market capitalization.
It is my assertion that that market cap is a physical manifestation of Metcalfe's Law in action, which is, in turn, a quantifiable demonstration of the intrinsic value of human beings. Now what does that mean and why should you care?
Well, if it's true that human beings have intrinsic value, then when we interact with a system such as Facebook's platform or Google's ads engine, these companies are making money from our intention, engagement, and participation using their platforms. Part of this is extracting some of our value and keeping it for ourselves.
Now we can have a long-winded discussion about whether that is right or wrong. But I think what's more exciting to talk about is what kind of world we would live in if we had platforms that didn’t keep the value for themselves. At Anatha, we believe that the logical answer is to include people in the value creation in such a way that we go from an extractive process to treating our user base as a product. We include collaborative experiences in which we treat our users and the communities that emerge on our platforms as partners—granting them all of the rights and privileges and most importantly capital that the term “partner” implies.
In the case of Anatha, we have demonstrated clearly in the governance tools and the treasurer (which controls the inflation and distribution policy) of our Flagship economic system that we care. Without going into too much detail about all features of the blockchain-based platform, mechanisms such as these will unlock value for users. The key takeaway will be that the Anatha network will programmatically distribute 50% of the value the platform generates back to end-users in real-time in the form of our native currency, the Anatha Rewards points.
Once deployed, we aim to create an economic environment which recognizes the Kantian principle of intrinsic value, which we will then use to quantify the market cap of our native currency. Looking further, this act will support the Buddhist principle of interbeing or the “oneness of all,” something we will unpack in a subsequent post.
EDWARD DELEON HICKMAN
CEO & Founder