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We feel value for Bitcoin because, in the last three million years, we evolved to have the mental operation of feeling value for things that are scarce, durable, costly to create, portable, divisible, fungible, and transferable so we could use them to divide labour between ever larger untrusting groups [1].
In the last three million years our neocortex grew to support close relationships from groups of ~50 to ~150 [2]. This is an indication of a strong evolutionary pressure to manage more relationships as human groups got larger as our success as a species meant ever larger populations.
However, group growth has been much faster than our brain capacity growth to manage more relationships. This meant that our ability to interact in a productive way was limited to bands and clans of no more than ~150.
To cope with group growth while minimizing conflict we evolved several strategies other than grooming, which is limited to ~20% of our time [3]. Amongst these strategies were: language [4], shared belief systems, rituals, symbolism, and, of course, money.
Within groups of ~150, especially within bands and clans related by blood, reciprocal altruism [5], favors, and barter were enough for productive relationships because our brains could track what everyone did for everyone else, and because it is within gene interest to help out each other.
However, in a context of scarce resources, to be able to collaborate, avoiding constant violence between non-kin and untrusting bands and clans, and to solve the problem of coincidence of wants [6], there had to be a device that could settle transactions with finality.
It is very possible that the first such devices were stone tools in the form of Acheulean industry hand axes, cleavers and picks, approximately 1.5 to 2 million years ago [7] [8].
This coincides with the evolution of Homo Erectus [9], its larger brain size and its enormous success as a human species, who effectively propagated, probably evidence of advanced inter-clan collaboration and division of labour, all over Africa and Eurasia.
As we continued evolving, we went migrating in our adoption of devices for storing value, media of wealth transfer and even as systems of counting and accounting. These were the more evolved stone tools industries, shells, beads, commodities, metals, and, finally, fiat money [10] [11].
However, fiat money is the first purely human produced form of money. All the others usually had some restriction in nature that served to limit its production, therefore guarantee its scarcity, thus value.
This is why cypherpunks [12] [13] had, for decades, been researching for ways of delinking again the capacity of creating money from people [14] [15] [16], to minimize human agency risk, guaranteeing scarcity, but within global permissionless computing systems.
The result was the creation of Bitcoin [17]: A peer-to-peer, decentralized digital asset that is scarce, durable, costly to create, portable, divisible, fungible, and transferable, which minimizes the dependence on trusted third parties, so we can continue growing, dividing labor between untrusting groups, while minimizing conflict and violence on a global scale [18].
This is why Bitcoin has value.
References
[1] Shelling Out: The Origins of Money – by Nick Szabo: https://nakamotoinstitute.org/shelling-out/
[2] The Social Brain Hypothesis – by Robin Dunbar: https://etherplan.com/the-social-brain-hypothesis.pdf
[3] Robin Dunbar at Nobel Conference 44 “Mind The Gap: Why Humans Aren’t Just Great Apes” – video: https://youtu.be/xRLCjlKQjeE?t=2401
[4] Neocortex Size, Group Size, and the Evolution of Language – by Leslie C. Aiello; Robin Dunbar: http://eebweb.arizona.edu/faculty/dornhaus/courses/materials/papers/Aiello%20Dunbar%20humans%20brain%20group%20size.pdf
[5] Reciprocal altruism – by Wikipedia: https://en.wikipedia.org/wiki/Reciprocal_altruism
[6] Coincidence of wants – by Wikipedia: https://en.wikipedia.org/wiki/Coincidence_of_wants
[7] The characteristics and chronology of the earliest Acheulean at Konso, Ethiopia – by Yonas Beyene, et al: https://www.pnas.org/content/110/5/1584
[8] Life history of a large flake biface – by Javier Baena Preysler, Concepcion Torres Navas, and Gonen Sharon: https://etherplan.com/life-history-of-a-large-flake-biface.pdf
[9] Evolution of Homo Erectus – by Dennis O’Neil: https://www2.palomar.edu/anthro/homo/homo_2.htm
[10] Fiat Money- by Wikipedia: https://en.wikipedia.org/wiki/Fiat_money
[11] Nixon Shock- by Wikipedia: https://en.wikipedia.org/wiki/Nixon_shock
[12] The Crypto Anarchist Manifesto – by Tim C. May: https://www.activism.net/cypherpunk/crypto-anarchy.html
[13] A Cypherpunk’s Manifesto – by Eric Hughes: https://www.activism.net/cypherpunk/manifesto.html
[14] Bit Gold – by Nick Szabo: http://unenumerated.blogspot.com/2005/12/bit-gold.html
[15] Bmoney – by Wei Dai: http://www.weidai.com/bmoney.txt
[16] RPOW – Reusable Proofs of Work – by Hal Finney: https://nakamotoinstitute.org/rpow/
[17] Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto: https://bitcoin.org/bitcoin.pdf
[18] From Gold to Fiat to Bit Gold to Bitcoin – by Donald McIntyre: https://etherplan.com/2020/04/25/from-gold-to-fiat-to-bit-gold-to-bitcoin/11352/
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