Prominent Israeli philosopher Yuval Noah Harari, who is best known for his best-selling book “Sapiens,” recently took aim at Bitcoin, slamming it as “a currency of distrust.”
Even though Bitcoin proponents might have good reasons to distrust the banks, their preference for the leading cryptocurrency is still based on the distrust of human institutions, Harari claims.
The famous intellectual claims that this is an “alarming development” given that money is supposed to create trust between strangers.
“I understand the causes for this distrust, but it is an alarming development,’ he said.
He hopes that humanity finds a way to build trustworthy human institutions in lieu of adopting technologies of distrust. The philosopher further added that humans control the world precisely because they learned to trust one another. He warned that algorithms could start controlling the world if humans put all their trust in them.
“Farmers grow food. Shoemakers make shoes. What is the function of the financial system? Finance creates trust,” Harari says. He adds that various financial systems are supposed to create trust between strangers who can cooperate on shared projects.
“Originally, there was very little trust in institutions like banks and governments, so money was minted from gold. Since gold was scarce, this limited the amount of money and limited economic cooperation,” he noted. Today, 90% of money is just computer data that cannot be easily comprehended by humans.
In March, Harari also argued against using artificial intelligence (AI) in finance. The philosopher warned that this technology could make financial regulation even less clear for humans. People should first gain an understanding of how AI operates and regulate it instead of integrating it into the financial system.
According to Harari’s philosophy, humanity is largely driven by myths that make large-scale collective cooperation possible.