When we first imagined the Lonely Old  Bitcoin Miner (or LOBM, as we’ve come to know him), we imagined that he  was a sad, sorry late adopter.

We began thinking of him about two years ago. It was the end of 2013,  the height of digital gold fever. In November, Bitcoin’s price had  peaked at, for a moment, over $1000. Bitcoin was going to be the new  currency of Cyprus or Argentina or maybe the world. Bitcoin could be  used to buy literally anything, from Alpaca socks to pizzas to murders.  Bitcoin was the new Facebook, at least for the Winklevoss twins, who  claimed to own 1% of all bitcoin in existence and were bullish that it  might easily trade at $40,000. That year, we couldn’t attend any party  or family gathering without being cornered by someone who wanted to know  how they could get in on it.

To be honest, on some level, we found the whole bitcoin thing to be a  bit silly and unsettling. Not least in part because it seemed motivated  by what one of us, Lana, and her co-authors, Bill Maurer and Taylor  Nelms call digital metallism.For  traditional metallists, having a currency backed by a scarce commodity  allows people to transact autonomously without any need for trust in  each other or in centralized authority like a state. For digital  metallists, Bitcoin is a commodity currency “backed” by cryptographic  proof, unforgeable scarcity guaranteed by the distributed blockchain.  For metallists, money is a ‘creature of the market.’ Those interested in  getting rich quick through Bitcoin — such as the LOBM and nearly  everyone we talked to at Thanksgiving and Christmas in 2013 — were  engaging in speculation on the value of Bitcoin as a commodity.

For us, digital metallism implies an overly marketistic,  individualistic, and ultimately anti-social vision of money and, with  it, human nature. We tend to think, alongside anthropologists,  historians, and plenty of economists, that money is more a creature of  politics than markets. Its value is tied to the collective institutions  that produce and manage it. We want to believe that people can come  together to design better monies, better worlds. But we also want to  believe that people need not do so as a collection of antagonists in a  hostile marketplace. We’re not against or afraid of markets, we just  prefer other fantasies, for example, those about, say, democracy,  somewhat untethered from markets, that can manage our public  institutions as public goods.

As off-putting as we found digital metallism, we were even more  unsettled by our friends and family who, like the LOBM, had no political  stakes in Bitcoin. The Bitcoin Bonanza seemed fuelled by a kind of  blind faith — not in markets, but in a belief that some cabal of  internet nerds know all the secrets so the rest of us don’t have to. We  normal people didn’t need to understand Bitcoin, worry about whether it  made sense, or be concerned about whether it would lead to a better  world. Instead, we just needed to be sure that we didn’t miss out on it —  whatever it was. In this way, if you think about it, aren’t we all a  little bit Winklevoss-like sometimes? And isn’t that a craven and  avaricious instinct we might work to overcome?

By late 2013, the idea of getting into Bitcoin hoping to get rich was laughable. Sure, many early adopters told tales of running an improvised mining rig in  their dorm room or home office, but by the time Bitcoin hit its peak of  attention and value, even those storied set-ups that were used to heat  houses over the winter would have seemed quaint. By design, Bitcoin is  meant to simulate a ‘scarce’ commodity, so over time, fewer and fewer  can be mined. Because of this built-in scarcity curve, along with rapid  acceleration of technology optimised for mining, that there was little  hope for anyone — save for perhaps those willing to invest a large  amount of expertise, time, and so-called “fiat money” — to ever hit real  Bitcoin paydirt through mining.

We imagined the LOBM, then, as a sad, sorry dreamer, the digital version of the “crazy, lonely, and toothless”  prospectors of yore. Most likely, he would never mine a single Bitcoin.  He was greedy. He was a laggard. He was unimaginative. He was not a  critical thinker. He was silly. His dreams were silly. And yet he was  also kind of beautiful. There was an optimism there that we found  touching.
We wanted the LOBM to exist. We both wanted to learn a little bit more  about how mining and the blockchain actually worked so, inspired by an  interest in what Matt Ratto calls “critical making,” we began to think about how we might build a Lonely Old Bitcoin Miner of our very own.

Before we built the miner, we knew, basically, how Bitcoin worked,  but building the LOBM helped us to really know it. Together with the  LOBM, we wrote code and clipped wires and panned for digital gold. We’re  surprised how many so-called Bitcoin experts we’ve met over the years  who’ve never done the same. In real life, using electronics to compute  that which has been imagined on paper is not easy. There is a lot of  invisible labor that goes into IT.

There is no Bitcoin manual. The original whitepaper by Satoshi  Nakamoto that launched the Bitcoin project describes the principles  behind Bitcoin-in-theory, but it can tell you nothing about the  institutional and technological regimes that constitute  Bitcoin-in-practice. In 2013, five years after Nakamoto’s paper was  published, Bitcoin remained sparsely documented and unstable. To get  started mining Bitcoin, we also needed to become members of various  forums like bitcointalk.org, join Internet Relay Chat (IRC) channels,  and compile the latest open source software. More like joining the  circus than watching the show.

Part 2. The LOBM stakes his claim

Early Bitcoin enthusiasts took great pride in their custom-built mining  “rigs” and press coverage of the growing movement typically included at  least one portrait of a miner standing in front of his server rack, legs  spread, arms crossed, encircled by rows and rows of blinkenlights.  In contrast, our ideal LOBM would have been an antique mechanical tin  bank in the form of a prospector, like this politician bank that ‘eats’  coins. We dreamed that the movement of the bank would somehow power the  mining, making the LOBM perhaps the first Bitcoin mining automaton.

But, alas, we couldn’t find any mechanical banks that seemed right,  so we settled for some old Disney merchandise, a plastic bank in the  likeness of Stinky Pete, the antagonist of Toy Story 2.

The technical requirements for mining Bitcoin are simple: reliable  electricity, a computer, and an internet connection. We wanted the LOBM  to be self-contained, mining with only the gear he could carry. So like  the gold-seekers who made their way with little more than a bindle and a  song, our LOBM was likewise minimally outfitted with a BeagleBone Black  hobby computer and a cheap Wi-Fi dongle. Powerful enough to run Debian  Linux but hardly a match for the custom Bitcoin rigs already chugging  away on the blockchain. The BeagleBone seemed like an appropriate  platform for a clueless and enthusiastic newcomer — poignant, absurd,  and a bit pitiful.

In retrospect, 2013 was a year of technological upheaval in Bitcoin.  Just as LOBM was getting ready to start mining on the BeagleBone’s 1 GHz  CPU, all of the serious Bitcoin miners were dumping their homebrew rigs  in favour of ‘application-specific’ chips, or ‘ASICs.’ These  specialised microchips were bundled into devices designed to precisely  execute the cryptographic function required to mine Bitcoin  and nothing more. Even the most tricked-out consumer hardware was no  match for these ultra-high efficiency machines and our BeagleBone  cowered at the feet of intimidating ASICs like the Butterfly Labs Bitforce and the TerraHash DX Large. Off-the-shelf mining fell so far behind the state of the art that the maintainers of many popular mining applications simply deleted their CPU mining code.

The general opinion among Bitcoin experts was that trying to mine on a  CPU was like entering a go-kart in the Indy 500. Ignoring this advice,  we installed an out-of-date copy of cpuminer anyway and, against all  odds, LOBM was ready to hit the mines!

It seemed, however, that the Lonely Old Bitcoin Miner was not going  to be so lonely after all. In 2013, nearly every tutorial we came across  suggested joining up with a mining ‘pool’ rather than mining ‘solo.’  Mining pools are cooperative networks of miners who divvy up the work  and the rewards that come with validating Bitcoin transactions. The  topology of a typical mining pool is a ‘hub and spokes’ network in which  only the hub node connects to the global Bitcoin network. When the hub  learns about a new block of Bitcoin transactions, it sends out  computational work for the members of the pool to grind over in  parallel. Due to the inherent randomness of the “proof-of-work” function that secures the blockchain,  the likelihood of finding a solution quickly grows with the size of the  pool. The key advantage of joining a pool is that even low-power miners  have a chance to earn some Bitcoin for their work.

With LOBM chipping away on the periphery of a giant mining pool at  560 kilohashes-per-second — roughly 1/1000th the rate of the cheapest  ASICs on the market in 2013 — we decided to introduce him to the world.  As a member of a very active pool, he was able to successfully mine tiny  fractions of Bitcoins, digital flashes in the pan, so we made a Twitter  account for the LOBM, and watched as he broadcast his luck. After a  year, he had more followers (14) than he did Bitcoins (0), which isn’t  saying much.

After about twelve months working with the pool, the difficulty of mining had risen dramatically  and LOBM was in desperate need of an upgrade. By one estimate, the  productivity of the global Bitcoin network jumped nearly 3000% between  January 2014 to January 2015. And yet, despite this explosion of  computational power, Bitcoin was designed to yield a steadily decreasing number of Bitcoins over time. We decided to give LOBM’s CPU a rest and find him an appropriate ASIC: the Block Erupter.

At the time of its release in May 2013, the Block Erupter was an instant hit. Unlike earlier ASICs, which could look rather menacing, the Erupter was a cute little circuit board that plugged into a standard USB port. Posters on BitcoinTalk enthused  about their “low cost of entry” and described their release as “history  in the making.” Soon, users were posting photos of dozens of Erupters  cooled by desk fans. Eighteen months later, however, Block Erupters were  abundant on eBay. They seemed like an artefact of another age, more  nostalgic icon than practical tool — a perfect tool for the LOBM’s  return.

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Part 3. Blockchain Eureka!‍

With the newly equipped LOBM rating an average 336 megahashes per  second, our understanding of his relationship to Bitcoin began to  change. We stopped thinking about LOBM as a digital metallist hoping  hopelessly to strike it rich. After more than a year of hopeless  hashing, wouldn’t the LOBM want more than quick money?

With the bonanza far behind him, we reasoned, the LOBM stuck to  mining out of a commitment to the network. He’s not alone in this. It  seems that no one really wants to talk about ‘Bitcoin’ anymore. Instead,  they want to talk about the ‘blockchain.’ The blockchain  is the technology underlying Bitcoin that allows far-flung computers to  come together as a network to create a permanent public ledger of all  Bitcoins. There’s a quasi-joke going around: if you want an audience for  any blog post, proposal, or speech about such matters, you should just  do a search for the word ‘Bitcoin’ and replace it with the word  ‘blockchain.’

An advanced version of this technology could be used, or so the  theory goes, to do just about anything. Cryptocurrency true believers  are now fascinated by next-generation projects like Ethereum, which  aspires to create a programmable blockchain that will back “smart contracts”  of all kinds. Some even hope that the blockchain could form the basis  for Autonomous Decentralized Organizations, a kind of post-state  anarcho-libertarian peer-to-peer governance structure. Of course, the  blockchain also appeals to those with a less radical vision. Because it  is decentralised, redundant, and public, the blockchain might also be a  way to create persistent records. This could be useful anywhere.

Efforts to use the blockchain technology beyond payment reveal a part  of the early Bitcoin vision not fully accounted for by digital  metallism. Indeed, in Lana’s recent dissertation on payment systems, she  made an analytic distinction between digital metallism and another  important, and in some ways contradictory, impulse at the heart of  Bitcoin: infrastructural mutualism. Adherents value Bitcoin and other  cryptographic systems built on a blockchain for their ability to  produce, in an idealized vision, a network of peers engaged in a  voluntary effort to maintain a decentralized, distributed infrastructure  for the benefit of the cooperators. In this way, Bitcoin offers a  critique of dependence on state and corporate infrastructure.

Even though the recent interest in blockchain over Bitcoins brings  this aspect of the project to the fore, it’s been part of Bitcoin all  along. Much early talk about Bitcoin, before the big gold rush, was more  about peer-to-peer payment and less about accumulation and speculation.  If anything, the present interest in blockchain is a resurgence of  infrastructural mutualism.

And we think we know now what the LOBM really wants. Money, the LOBM has come to realize, is, as Keith Hart puts it, a memory bank.  It is a way of making material the network of obligations between  people. The blockchain is an immutable record of this sociality. The  LOBM wants to be part of it. He wants to be a peer. He has become an  infrastructural mutualist hoping to come together with others to produce  something beneficial for a larger collective, something that will  overcome corporate and state oppression, something that will last  forever. He wants to host the blockchain, he wants to touch eternity.

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Part 4: Some peers are more equal than others?‍

Bitcoin is often described as “peer-to-peer” but, as our experience with  mining pools — not to mention third-party wallet hosts and other  Bitcoin intermediaries — taught us, not all participants in are equally  addressable as peers. If the LOBM wanted to truly be a Bitcoin peer, he  needed to abandon the conveniences of the mining pool and strike out on  his own—in the parlance of the movement, LOBM needed to become a full node.

Over the years, many curiosity seekers have tried and failed to set  up their own full nodes. Indeed, if you search the web for ‘Bitcoin,’  you are likely to encounter Bitcoin Core, the software needed to run a  full node, before you find any of the (comparatively) easier to use  options. Bitcoin Core is easy to install but it can be punishing to your  PC. The official documentation recommends 50 GB of free hard disk  space, 2 GB of RAM, and an internet connection that can handle 200 GB of  traffic per month. Before Bitcoin Core can even begin to contribute to  the network, it must first download and validate the entire blockchain.  Let me repeat: every full node is required to first process the entire  transactional history of Bitcoin.

Even ardent Bitcoin advocates attest that most Bitcoin supporters  lack the resources and expertise to run a full node. The central  compromise in the realisation of Bitcoin, then, is that it is not a  fully distributed network of peers but rather a decentralised network in  which a small number of peers running full nodes provide service to  tens of thousands of ‘thin’ clients. Among infrastructural mutualists,  running a full node is considered an act of generous service; an  inconvenient expression of one’s commitment to the network. Whereas the  early miners were compared to fortune seekers and gamblers, the  administrators of full nodes are described as volunteers ‘doing their  part’ for the good of the network. A group of Bitcoin advocates in  Brisbane recently declared 30th August “Bitcoin Node Day”  as a way to raise awareness about the need for more full nodes. Whereas  digital metallists see Bitcoin as a platform for autonomous  competition, they see it as an infrastructure of cooperation.

Running a full node is the ultimate dream of the LOBM, but it tests  the limits of his modest hardware. We outfitted the Beaglebone with a  new 64 GB SD card but the blockchain currently weighs in at just north of 70 GB  and its rate of growth is rising. Storing the data is less challenging  than verifying it. After 2013, new Bitcoin software began to generate  increasingly large blocks that repeatedly caused Bitcoin Core to crash  until we started to re-allocate big chunks of the BBB’s internal memory  as swap space to prop up our limited supply of RAM. There is no easy  shortcut around the computational challenge of validating the  blockchain. After days and days, the LOBM is still hard at work,  grinding away on transactions that were conducted back in 2013 when he  first took up the Bitcoin dream.
We know that the LOBM’s meagre mining system doesn’t seem like a  legitimate, good faith effort to build a full node. But the difficulty  faced by the LOBM forces us to wonder what it really takes to be a peer,  to imagine that we can all be peers? How might we design a truly  decentralised, truly peer-to-peer economic information system?

Bitcoin, it seems, is ‘mined out’. The Bitcoin Foundation no longer  suggests mining as a reasonable path to acquiring Bitcoin. But we ought  not to forget that the end of homebrew mining was the result of rapid  acceleration in the development of special purpose mining technology.  Our little sad, sorry miner would still be sad and sorry if we’d spent  most of our disposable time and income on him. Since 2013, mining has  reached a truly industrial scale. According to Vice, a mining facility in rural China,  one of six owned by four people, cumulatively generates 4,050 Bitcoins a  month, accounting for a not insignificant 3% of the entire Bitcoin  network.

Our guess is that the secretive group that owns these facilities are  not fundamentally or primarily motivated by mutualism. This is evident  in the top comments on the Vice video, which demonstrate the view that  beyond the use of Bitcoin as a speculative commodity, the infrastructure  —the blockchain itself and the computers that power it— is a vehicle  for speculation. Aspiring to own the backbone of the blockchain is a  longer-term gamble than simply hoarding the paltry Bitcoin that are yet  to be found.

Of course, this should perhaps come as no surprise. In all gold  rushes, those who produce the means for mining always make out better  than the majority of individual prospectors. Efforts to ‘dig coin’ have  resulted in a mining oligopoly. Going forward, there can only be a  distinct miner class and a user class. Digital metallism has overwhelmed  infrastructural mutualism. In this sense, Bitcoin is as much like a  land grab as it is like a gold rush.

In the face of this, how could any individual — not just our sad,  sweet, Lonely Old Bitcoin Miner — aspire to be a peer in Bitcoin?

Perhaps the LOBM represents a brief spark of resistance, a tiny  mutualist doing his part in network of metallists. A hopelessly  idealistic volunteer, he has developed an expertise and commitment to  infrastructural mutualism that far outstrips his available resources to  enact it at scale.

Maybe the ambiguity of peership was a problem lurking in Bitcoin all along. The following infographic, published in IEEE Spectrum in 2012, uses Alice and Bob,  the classic hypothetical ‘peers’ in any cryptography puzzle, to  describe how Bitcoin works. In this case, Bob is an online merchant who  accepts Bitcoins and Alice is a buyer who wants to pay Bob with her  Bitcoins. The infographic also adds to the mix Gary, Garth, and Glenn,  who are described as Bitcoin miners. If Alice and Bob are peers, what  are these guys? What is their relationship to Alice and Bob? The key  problem, at least for our idealistic LOBM, is that our habits of mind  are not adapted to answering questions like this. The lack of a clear  definition of “peer” is as much a problem of policy (and politics) as it  is a problem of technology. It therefore requires social solutions, not  technological ones.

Which brings us to a conclusion our LOBM would be very disappointed  with. The future of blockchain technology will likely belong to those  who are neither metallists nor mutualist, who don’t really care about  the techno-social politics of peership either way, who don’t care what  we or the LOBM want. Most of the capital investment and serious thinking  around blockchain is not happening with anarchists or activists or  agorists in mind.

The world’s largest financial institution are interested in adopting  the technology for their own purposes and are building private  blockchains that could be used, for example, to speed up settlement  latency for interbank clearance. This would be less like the World Wide  Web, and more like the Sabre global distribution system, which allows  all airlines, travel agencies, and distribution channels to manage  reservations and schedules in a single private network. The  ‘decentralised’ ‘peers’ here would be member banks.

This might be all well and good. We, and we think the LOBM, are not  categorically opposed to large financial institutions doing their thing.  And we may not even mind Winklevosses shadowy mining industrialists,  and other Bitcoin gamblers doing their thing(s), either.

But these things have nothing whatsoever to do with the dream the LOBM  once dreamed. They’re nothing compared to touching eternity.