Ask anyone, ‘Is the moon made of cheese?’ and you already know what they’ll say. But ask any number of people, ‘What’s Bitcoin?’, and they may not even have an answer for you. While Bitcoin is still not a household name, the cryptocurrency is already making its way into the realm of space.
In the new book, Blockchain Space, Bitcoin and space enthusiast, Heidi Hecht, discusses the far out ways Bitcoin and other cryptocurrencies offer practical solutions for life on Mars and other planets. We wanted to learn more about how Bitcoin could actually be used in space, so yesterday, we chatted with the author.
In our interview, Heidi Hecht talks Bitcoin, Space, and E.T.s:
Heidi, you say banks are not practical in space. That is quite a concept many people probably haven’t thought of. So, why is that exactly?
The problem is that the worldwide banking system is inefficient and has incentive to keep the system inefficient. If you throw money at the financial system, it can do its job of moving money around in minutes instead of days. Bitcoin is sort of developing this problem too, but the difference here is that people can jump to one of the major alternative cryptocurrencies if they don’t like the way that things are going with Bitcoin. And Bitcoin can’t really do anything about it besides try to stay competitive. That’s something that the mainstream financial system hasn’t really had until now – serious competition.
If the traditional financial system is allowed to take root in outer space, this becomes a problem that will get worse when you add in the laws of physics. You can send a transaction from Earth to Mars and get a receipt back in less than an hour when the system works perfectly and if block times and fees are not much of a factor, but bankers (and some Bitcoin miners) have incentive to make the system inefficient so that they can charge high fees to get money into the hands of the recipient quickly.
My idea was that what outer space has is a terrible shortage of labor. When space colonization and economic activities like mining the asteroids take off, many “blue-collar” and migrant workers will be tempted by lucrative work contracts at sites throughout the solar system that need extra pairs of hands to be developed. Eventually, those migrant workers – even ones that just move from site to site performing short-term work – could number in the millions, enough to be seen as a collective economic force all on their own.
Most of those workers will want to use that to establish a comfortable nest egg or send money home to their families. That means an opportunity for entrepreneurs who are willing to push back against traditional remittance services and develop a system that allows migrant workers to send money home both quickly and cheaply even allowing for the fact that they could be working at a site out in the asteroid belt. One of the points I tried to make in the book is that it’ll help if the migrant workers have choices about how they want to send money home so they don’t get taken for a ride by services like Western Union.
Can the blockchain be used to prevent an evil Martian from defrauding an election?
I can say that it would make election fraud trickier. If the legitimate system has enough hashpower, enough nodes, and enough experts who can watch the system for red flags or anything abnormal, it could even become quite expensive. An “evil Martian” would pretty much have to overwhelm the system through sheer power or, if the blockchain network is small enough, gain control of the few nodes on that network and do something to compromise them. So I won’t say it’s impossible, but one of the good things about the blockchain is that it has built-in tools that would pretty much generate some obvious red flags that could indicate a malfunction or could indicate fraud.
When you start talking about blockchain, it’s hard not to mention smart contracts. Do you think they have a place in the space real estate market?
I think they will. Smart contracts and a blockchain-based notary system will definitely both be needed. Notary fraud is a problem; in some countries, a malicious actor could steal land out from under somebody’s noses just by bribing a notary agent. And some nations are implementing a Blockchain system to deal with the problem. As far as smart contracts are concerned, I see them having a place in any transaction that involves a physical asset like real estate in space.
A contract could include a clause that says that if the buyer doesn’t settle up in a certain amount of time, ownership reverts back to the seller. That’s normal for real estate deals, but it’s also easier to enforce when you have to go up against a “squatter” because the smart contract can be implemented in a way that would lock them out. That’s definitely not a nice thing to do when you’re talking about real estate in outer space, but it also protects the rights of the seller or the legitimate owner.
What’s one of the coolest applications you think the blockchain could be used for in space?
I’ve kidded a bit about how a Blockchain voting app can be used to vote on what the colonists want to have for supper. That’s kind of a neat thing to do when most meals will be whatever you can make for a crowd at first and you don’t want arguments over what to make for a meal to turn into some serious hard feelings. That can happen real fast when you’re basically living in an environment where you can’t just go take a walk if you’re frustrated with somebody.
So I think it’s cool; nobody can really lie about what they voted for, but neither can they deny that they got the same vote as everybody else. I can see that kind of thing helping to cut down on instances where a minor disagreement got turned into something that got blown all out of proportion.
I’d like to bring up a topic that’s popular right now and that is central banks across the globe considering or already developing their own digital currency. To use the US as an example, do you think American’s money will be any better off with a digital USD than paper money?
If the government or a bank creates it, that entity will definitely find a way to exploit or manipulate it. With Dogecoin, we saw an example of a cryptocurrency that’s inflationary. Dogecoin miners can mint an effectively infinite supply, limited only by time. And governments will not have missed that if they’re paying any attention at all. Another problem is that governments will want to build in “back doors” they can use to access devices that are using their system, they’ll want to keep track of who’s doing what. And that’s not good for people who are using cryptocurrencies because they probably aren’t doing anything wrong, but they prefer privacy.
How likely is it we will be buying beer in space with a photo ID card, do you think?
LOL, I could see a definite craft beer industry in outer space. But probably the laws related to alcoholic beverages will be a lot more lax in outer space than what we’re used to on Earth. A photo ID might not be required to buy an alcoholic beverage in space for quite a long time.
Could Bitcoin allow us to trade goods with Martians or “extraterrestrial beings”?
It could happen. It’s likely that any extraterrestrials that are capable of travel between stars and making interstellar trade profitable will have an advanced version of cryptocurrencies, so we may be looking at dealing with exchange rates, but Bitcoin and the altcoins we have will be useful in that regard.
How far into the future could we expect Bitcoin to “land” in space?
It might not take long for Bitcoin to make it into space. Bitcoin insiders had a popular petition for NASA to put Bitcoin on Mars. And of course Garzik had his BitSat idea with orbiting Bitcoin nodes. Regular use of Bitcoin in space could take centuries, though. It’s going to take time for the required infrastructure to be developed.
While you may or may not believe in intelligent life somewhere out in space, people are already paying for trips to space with Bitcoin. If and when humans colonize other planets, cryptocurrencies can offer a much more efficient way to transact.
Not only is Bitcoin in space a real possibility, there are cryptocurrencies being developed specifically to accelerate space colonization, like Marscoin. Will the currency of choice be Bitcoin? Who knows, but one thing is for certain, cryptocurrencies make living in space one step closer to becoming a reality.
Heidi Hecht’s new book, Blockchain Space, is available on Amazon in e-print and paperback.