Bitcoin is an illusion, a mass hallucination, we hear. It’s just numbers in cyberspace, a mirage, without substance. Bitcoin is supported only by the faith of the idiots who buy it and the biggest fools who buy it from these idiots. And you know? All this is true. Dollars are also an illusion. In fact, almost all of our dollars, about 90%, are purely abstract – they literally do not exist in any tangible form. The dollar is what is called a fiat currency. The temptation for nation-state leaders to make money has always been almost irresistible. Inflation is one of the obvious results of this policy. The bitcoin blockchain was created, in part, to remedy this historical weakness. Once the 21 millionth bitcoin has been extracted the system will not produce any more. There are some radical differences between cryptocurrencies and dollars. For example, transactions in the bitcoin system are recorded in an unverifiable large ledger that does not rely on the authority of banks or governments, but on the strength of a public computer network to which whoever is free to join. Also, once again, the supply of bitcoins is finally fixed. Money itself is an illusion, a mass hallucination. You work hard to do it, cultivate it and keep it, but still, the only thing that drives it is its symbolic power. Which is really great, seen from a certain angle. Cryptocurrencies can not be understood, even a little bit, by anyone who thinks that money is real, solid or sustained by anything other than human trust in institutions whose stability is always uncertain. The theory behind all cryptocurrencies, including bitcoin, is that records produced by a distributed computer network can be made tamper-proof, thus theoretically guaranteeing the strength of a currency better than governments. And so far, despite some significant bumps on the road, the blockchain system on which bitcoin is built has at least partially proved this theory. A million or more bitcoins have been stolen since 2009, but the underlying accounting system of the underlying system, the accounting system on which bitcoin is based, has so far remained stable and incorruptible. To say that “bitcoin is a fraud” because bad actors have scammed people amounts to saying “the financial services industry is a fraud” because Jamie Dimon’s company is crooked. The struggle for the stability of any currency is always being lost, because wherever there is a chance to play or forge a transaction, human nature is such that some will try to cheat. Even the limited and precarious stability that we have in developed countries requires vigilance and work on the part of countless principled people, and there is never certainty. The struggle to preserve the illusion that money is real is never finished and can never be.