The prime characteristics of a Schelling Point, according to Thomas Schelling, are “some kind of prominence or conspicuousness. Equally essential is some kind of uniqueness. Uniqueness conveys prominence, uniqueness avoids ambiguousness.” Therefore, Bitcoin would be a Schelling Point solution, a signal to the masses, if Bitcoin were prominent, conspicuous, and unique amongst possible solutions. Let’s now consider each requirement of a Schelling Point as it relates to the characteristics of Bitcoin.
Is Bitcoin Prominent?
By definition, “Prominence” is “importance, significance, value, or the state of being particularly noticeable.” Why is Bitcoin a Schelling Point? Because Bitcoin is prominent!
- Bitcoin is dis-inflationary, truly scarce, and a hedge against monetary corruption.
- Bitcoin is decentralized.
- Bitcoin is sound money, both fungible and a store of value.
- Bitcoin is an ideological flag.
- Bitcoin is legally indifferent, borderless, trustless and permissionless.
Is Bitcoin Conspicuous?
“Conspicuousness” is defined as “attracting attention or notice, standing out as to be completely obvious.” Why is Bitcoin a Schelling Point? Because Bitcoin is conspicuous!
- Bitcoin is open source and forward compatible.
- Bitcoin is resistant to confiscation.
- Bitcoin is a bank for the “unbanked.”
- Bitcoin is counterfeit resistant and immutable.
- Bitcoin is robust to attack and antifragile on both a technical and economic level.
Is Bitcoin Unique?
“Uniqueness” is “the quality of being particularly remarkable, special, or unusual”, and something is unique if it is one-of-a-kind. Why is Bitcoin a Schelling Point? Because Bitcoin is unique!
- Bitcoin is power by consensus, not command and control.
- Bitcoin is both transparent and pseudo-anonymous.
- Bitcoin is a narrative technology and linguistic phenomena.
- Bitcoin is a networked and digitally native financial system.
- Bitcoin is game theory and social engineering.
Final Thoughts
Based on Schelling’s own definition of his “focal points” of attraction, I suggest that Bitcoin is indeed a Schelling Point and a signal for the masses. Is Bitcoin the most powerful Schelling Point in history? Time will tell, of course. It does seem obvious to me (pun intended) that Bitcoin is prominent, conspicuous, and unique amongst possible solutions.
Thanks for reading!