Bitcoin often makes the news because of its volatility, but its real-world use cases continue to grow in Asia, Africa, and Latin America as people seek to escape weak currencies, 20+% inflation or even hyperinflation, and government censorship of financial transactions in authoritarian regimes.
Christian reactions to bitcoin have ranged from harsh criticism (e.g., buying bitcoin is gambling and therefore sinful), to apathetic ignorance, to enthusiastic support.
Most Christian discussion about bitcoin is on the internet (Twitter, blogs), but several popular-level books have been published recently. Having read all this material, I came away with two impressions:
- The harshest critics of bitcoin tend to be those who do not understand bitcoin properly as a technological innovation. And such critics are not professional or experienced investors, who manage investments and who regularly follow the financial markets. In other words, they criticize bitcoin without being well-informed about bitcoin and financial markets.
- The strongest advocates for bitcoin tend to be cryptocurrency enthusiasts who understand bitcoin well and/or are experienced investors. However, they tend not to have strong biblical-theological grounding, whether through formal theological education or by rooting their arguments in biblical-theological scholarship. I have found their arguments to be helpful, but not well-grounded exegetically and theologically.
As a PhD in New Testament and Systematic Theology, and as head of research for an asset management firm that manages exchange traded funds (ETFs), I have a unique combination of experience and training to address the topic of bitcoin from both biblical-theological and financial asset management angles.
My paper will argue that:
- Bitcoin is fundamentally a technological innovation, a new form of money that uses blockchain technology, which allows bitcoin to store and to exchange value in a decentralized, permissionless, and trustless way. This is of great value for the 1.4 billion people in the world without a bank account and for political, religious, or social minorities who face financial censorship.
- According to the U.S. Securities and Exchange Commission (SEC), bitcoin is a commodity, not a security (i.e. an investment) or a currency (like U.S. dollars). For those in the West, bitcoin should be viewed primarily as a ‘store of value’ (like gold) rather than a ‘medium of exchange’ (like U.S. dollars) – at least for now.
- At least three biblical-theological arguments favor the use of bitcoin for Christians, especially in the non-western world:
(a) Mankind’s sinfulness extends beyond individuals to systems/institutions. Governments throughout history have always inflated and debased their currencies until they become worthless. Since the creation of the U.S. Federal Reserve in 1913, the U.S. dollar has lost 96% of its value and will continue to lose value indefinitely.
(b) The unbelieving world will always persecute Christians and sometimes in a financial way, so churches must prepare themselves for financial persecution (e.g., freezing bank accounts, seizing church funds).
And (c) only God’s kingdom endures forever, while nations rise and fall, so Christians should not presume that their government and its currency will endure indefinitely.