FULL TEXT of my article (English + Spanish): "Toward an Anthropological Theory of Money." 💸🐚📿🪙₿ First published in The Satoshi Papers: Reflections on Political Economy after Bitcoin (2025). Links below. ⬇️

"Toward an Anthropological Theory of Money" (2025). In: The Satoshi Papers: Reflections on Political Economy after Bitcoin. LINK TO FULL TEXT:

"Towards an Anthropological Theory of Money" (Spanish). Thank you to Leopoldo Bebchuk for the translation. 🙏 LINK TO FULL TEXT // TO THE COMPLETE TEXT:

ABSTRACT: Money arises to solve a problem of social coordination: How to reliably settle debts, or satisfy creditors, in a particular market at low cost. Because it is a solution to a problem, money can be considered a social technology. I argue that the motivational principle of economy guides human aggregates, over time, to select forms of money that more efficiently solve this problem by improving upon specific characteristics of money that function as technical parameters. These include its ability to store value (its use value and scarcity) as well as its availability, durability, portability, fungibility, divisibility, and verifiability. These technical characteristics of money enable it to perform specific social functions: As a store of value (collateral), a medium of exchange, and a unit of account. Taken together, these social functions render money a reliable method of payment. Thus money is a kind of chimera: It is the cheapest valuable that is both sufficiently scarce to retain its value and sufficiently cheap (easy) to acquire, move, store, precisely subdivide, and verify. Monies whose technical parameters render them better suited for satisfying creditors in a particular market at lower cost tend to displace less efficient monies within that market over time; they may even give rise to unexpected new social technologies, as with the development of writing from the use of Mesopotamian commodity tokens. However, the process of monetary displacement also entails switching costs that include the costs of issuing, verifying, storing, and replacing the new currency as well as the cost of decentering or relativizing the established authority of previously standard forms of money. The relatively low costs of transacting with an established form of money combined with the relatively high costs of adopting new forms of money render money a social institution. I further argue that the purpose of money—to satisfy creditors—is psychological before it is legal or technological. Satisfaction that a debt has been paid is a moral sentiment that precedes institutions of both law and money. Accordingly, there is always the possibility that a debt has been paid but not settled in the mind of a creditor. The phenomena of political legitimacy and rule of law are largely functions of the overall state of creditor satisfaction in a human community. When the balance of this social ledger is tipped consistently and significantly to the negative, the social system undergoes a transformation: A reformulation or reorganization of roles, hierarchies, processes, leading personalities, and, potentially, of social utilities such as money. Before presenting my outline of a theory of money, however, I first take stock of the state of the art in anthropological theories of money by reviewing in some detail the account presented by anthropologist David Graeber in his 2011 book Debt: The First 5,000 Years. After describing several fatal shortcomings of Graeber’s theory, I propose a theory of money that I believe is better grounded in the historical and ethnographic evidence.