Feudal Japan had a class system based on a simple hierarchy. There were four classes: warriors called samurai at the top and merchants at the bottom. In the middle were farmers and artisans (craftsmen).
The samurai thought merchants added little value to society. Their services as middlemen who brought things to where they were needed most, was not appreciated. The role was seen as parasitic; capable of playing both sides, extracting profit and information from a privileged position. Most importantly, they posed a threat to the ruling class.
Today, the order is reversed. Merchants have gobbled up the other classes. Everyone is forced to play money games – Squid Games where nothing is sacred – where the best players tend to be the most shameless. Everyone must sell something. Games that warriors are poorly suited for because they are more committed to their code, to some story, than they are to getting more points. Samurai called their code bushido, a tradition with ritual suicide as a core component and probably as far as you can get from the modern idea of utility maximization or economic rationality.
Warriors are most closely related to today’s artists, but the spirit can be found in anyone who follows an internalized code from which they derive their actions and behaviors. George Orwell provides a fitting description: “The minority of gifted, willful people who are determined to live their own lives to the end…” The warrior wants something that can’t be measured or counted.
I’m not advocating for a return to a feudal system with violent, despotic, and bureaucratic warlords at the very top. I advocate for more options, different ways to see the world, and an end to domination by a single character type.
Entire classes of small and local merchants have already been outcompeted by algorithms and code. Clicking a button to submit your order sets off a chain of events in which many tasks are automatically completed: money is transferred, confirmations are sent, labels are printed, a robot is sent from its charging bay to the part of the warehouse where your item is waiting to be picked up. So why not take it further?
Merchants are not bad; they are simply transactional. And something like Ethereum, with the capacity to turn the world into a series of transactions, seems to be all for the merchant. But people may not realize that in doing so, it also replaces the middleman. Protocols can sit in the middle of transactions, extracting profits when called on and distributing those profits exactly as programmed. They can even be set to take no profits at all. Corporations can be replaced by stacks of modular functions trusted to run as written. If it is, once again, time for society to be rebalanced and for the order to be rearranged, Ethereum can build it in ways that were not possible before.
It's all about creating powerful little rules. Not all functions make sense to move to a blockchain, but rules involving money are obvious to start with because money must move between parties who want to trust each other, and money is now mostly digital. Take, for example, the Uniswap protocol. Known as a decentralized exchange, Uniswap is a set of rules that automatically performs trades on behalf of the user. If you have ETH and I have USDC and we both agree on the price, then we would want someone –or something – we both trust to remain neutral and perform the transaction for us. The Uniswap code does just this. It lets us swap using a cold set of logic.
FTX used a different approach. FTX was a centralized exchange, which meant between the time you deposit and withdraw your money from their system, human decision makers ultimately decided what to do with your money. Since these middlemen sit in a privileged position, they must be trusted to keep money safe and perform as expected. People who choose Uniswap don’t have to worry about this because the code in the middle can only do a few simple functions. The code doesn’t know how to steal. There is still risk. The risk just moves away from the middleman as a fallible human, and toward the logic and setup of the rules that replace the middleman. In other words, making sure there are no backdoors for swindlers to dip their fingers in.
The Wikipedia article about secure multi-party computation (a fancy cryptography thing) introduces a nice way to think about crypto protocols. Think about the protocol as a person you can trust. So instead of thinking about a decentralized exchange like Uniswap as an incomprehensible set of ones and zeroes, think of it as a person. Let’s call this person Sam Bankman-Fried. You can trust Sam to do his job because deep down he is made of logic that can’t break the rules of math. When both you and I agree on a price for a trade, we give our money to Sam who makes the swap for us. That’s it. Sam always does his job. He’s like a vending machine that just sits there until someone presses the right buttons.
These types of protocols can replace other functions, not just trading. You trust (or don’t trust) a government to count your votes correctly? A protocol could do this. You trust (or don’t trust) a company to keep your data private? A protocol could do this. Exactly how it is done and where the humans come in or don’t come in are things we need to decide. These are not easy or simple tasks. We are trying to create ever more perfect laws and since these are public protocols, they require public sentiment to be legitimate. It’s like creating micro-constitutions. Once set up, they are hard to change. But if people believe in them and they are useful enough, then we will have created enduring decision-making structures to keep building with and on top of.
Ethereum can be just as good at replacing bureaucrats as it is at replacing middlemen. By shrinking the role of people in enforcing the rules, we free up our collective energy for creating better rules, thinking about and designing the machines instead of being expected to function like one.
In 1654, the renowned samurai Miyamoto Musashi, described the “Ways” of the men of his world in “A Book of Five Rings” (Victor Harris translation). “The Way of the carpenter is to become proficient in the use of his tools, first to lay his plans with a true measure and then perform his work according to plan.” The farmer “sees springs through to autumns with an eye on the changes of the season.” These sound like the middle classes of the old order, the, ideally, content and complacent majority of society. Normal people. The remaining classes, as Musashi describes them, sound extreme: “the Way of the merchant is always to live by taking profit” while “generally speaking, the Way of the warrior is resolute acceptance of death.”
The merchant seeks advantage through transaction. They live by creating (if you want to be nice about it) or extracting (if you don’t) extra value where they can find it, and if there is mutual benefit, economists call it a positive-sum game. Warriors are always ready for war and the violence and death that comes with it. These are fictional, flat characters to make a story work. In reality, our character is made of many sides, each one activated at different times, to meet each moment. Sometimes we idolize gains. Sometimes we idolize the hero. There are times we want both and times we choose a side. Sometimes we make a commitment inside, to ourselves, but outside, act in a way that fits the world we find ourselves in.
In her translation of the ancient warrior tale Beowulf, Maria Dahvana Headley writes in the introduction: “The phrase ‘That was a good king’ recurs throughout the poem, because the poem is fundamentally concerned with how to get and keep the title ‘Good.’ The suspicion that at any moment a person might shift from hero into howling wretch, teeth bared, causes characters ranging from scops to ring-lords to drop cautionary anecdotes. Does fame keep you good? No. Does gold keep you good? No. Does your good wife keep you good? No. What keeps you good? Vigilance. That’s it.”
One character is not better than the other. The merchant tends to be more logical, favoring peace and prosperity through trade and cleverness, an objectively good cause. Warriors have been some of the worst people in history because the warrior is more emotional, more prone to rage. We’ve seen the world flash with rage. Riots and uprisings burn hot, fast, then out. Controlled rage, focused and sustained, simmering, is how the warrior wields her power. You want to stay “calm but pissed” as a Muay Thai coach once told me. Vigilant.
Technology ended the age of the warrior. The gun made it so the level of skill and dedication needed to play the warrior’s game, a game of death, a game of kill or be killed, a zero-sum game as the economists would call it now, fell dramatically. Guns made it so anyone with fingers could deal out death at scale.
A similar shift is happening now. Blockchains change the nature of transacting. They can sever the link between you and the middleman; between government and money. These interactions have to do with trusting someone or something to issue some unit of scarcity, or perform some transaction on your behalf, securely and with neutrality. A blockchain could do this.
There is no guaranteed end to the game we are in, but 2008 was also not that long ago. The global financial system nearly collapsed on its own, due to its own corruption. It was only propped up because the people in control fiddled with the scoreboard. It may teeter again, and it may fall. Or if you felt compelled to do so, you could make choices to help speed this all along. Sometimes we need to play the characters available to us. Sometimes we must play the merchant because it is the only option we have to defend our truth and the territory around it.
There is no guarantee that the next game will be better than this one. The only certainty is different rules favor different types of people.
Musashi’s description of the warrior may seem like the beliefs of a barbaric, fanatical death cult. A valid take. Because haven’t we transcended such savagery? Aren’t we better than that? I think it depends on the kind of world we live in. Money buys peace, but just as most currencies become worthless with enough time, the bargain does not last forever. Peace is a fragile privilege, and maybe money matters simply because it is not completely helpless in the face of violence. After all, at the end of the movie, when the bad guy is on his knees begging for his life, what is the last thing he tries to do? Make a deal.
In the earlier quote by Orwell, he didn’t name the class he was describing. He didn’t romantically attach his words to the notion of a warrior, but he did end that same sentence with “and writers belong in this class.” I think he was getting at a similar idea: that warriors and artists, and maybe even scholars, scientists, and defenders of irrational traditions, are somehow related. That there are certain types of people, a minority, who find games like money uninteresting. And if there was a choice, they would choose not to spend their lives selling and transacting. They would rather seek out and defend their version of the truth.
In 1941, Orwell wrote about “the hard fact, so difficult for many to face,” which I tend to agree with, “…that the choice before human beings is not, as a rule, between good and evil but between two evils. You can let the Nazis rule the world; that is evil; or you can overthrow them by war, which is also evil. There is no other choice before you, and whichever you choose you will not come out with clean hands.” Our natural state is more violent and unreasoned than most people want to believe. As natural as the bodily fluids and stenches that modernity – specifically money – keeps suppressed and hidden away. The merchant thrives in a world of plastic. The warrior sees all the piss and shit underneath.
Orwell lived through and wrote in an objectively unpeaceful time. Readers can judge for themselves how closely the period they are living through rhymes with Orwell’s, but to me, his words resonate today, not only for how they still scratch at hard truths, but because it feels like we are, once again, in an age of fanatical death cults, so “we do not have the chance, in a time like this, to say ‘Tomorrow we can all start being good.’… We only have the chance of choosing the lesser evil and of working for the establishment of a new kind of society in which common decency will again be possible.”