Where does Bitcoin get its value from?

One of the most asked questions around Bitcoin is where it gets its value from or what is “behind it”.

Building on the core argument in Yuval Harari’s seminal book Sapiens, we must accept that much of what we consider “intrinsic value” is derived from a social consensus that has developed over time.  So, while gold has some industrial value as a metal, the social consensus around it as a store of value has greatly inflated that value.

Then, Bitcoin has a clearly defined scarcity and rate of inflation. The currency supply is not being inflated at the whims of any government.

Finally, Bitcoin has significant utility and that itself has a value. You can nearly instantly send money now to anyone, anywhere in the world if they have a Bitcoin wallet. No middlemen, low fees. That’s utility with value.

The combination of the above suggests to me that there is a growing trust that Bitcoin is secure, its scarcity is known and has great utility. As result, there is a rapidly developing consensus that it is a store of value just as Gold is.

Whereas gold’s intrinsic value comes from a combination of the scarcity of the metal and the social consensus that has developed over millenia, Bitcoin’s intrinsic value comes from a consensus around precise scarcity, proven security and significant utility.

Partner in reforming land ownership, or step aside

The question of land in South Africa will be critical to the 2019 election. Many will push for a leap toward expropriation and radical reform.

The rest of the political spectrum would do well to accept that any further navel gazing about the need for a drastic change in our approach to land is asking for trouble.
When we talk of land, we’re talking about two things:

1. Farm land, which is farmed, and which farmers make money out of. 

2. The idea of land – of living space – an idea so inherently understandable that many a regime have invested in the idea. Remember lebensraum? Twinned with the idea of land, is the emotion relevance of dispossession. 

In living memory of many, blacks were forcefully disposed of their land. In the generations before that, the vast majority of land in this country was forcefully acquired by the conquering colonial minority.

The critical importance of meaningful and visible land reform is as much about creating black ownership in agriculture as it is about all South Africans feeling a sense of fairness in the ownership patterns of our farming and living space.

The antidote to dispossession of black land is more blacks owning land. Goverment has the key facilitation role here both in residential and agricultural land. 

In the residential space, goverment must support the development of valuable real estate and support middle income earners to acquire property. There are a myriad proven examples of such initiatives from around the work that we can learn from. 

In the agricultural space, the challenge is not simply about transferring land. We need to ensure that the outcome is productive agriculture and more black farmers who are able to build successful commercial operations. 

The challenge is to build fruitful partnerships between experienced white farmers and passionate black farmers. Farming is a generational thing for most. Very few new comers walk into farming and succeed – the benefits of generations of learning and understanding and patience make all the difference to the enterprise of agriculture.

To the end, I would go so far as to say that I would support a position on land reform that targeted for expropriation (with compensation) all farms where farmers were resistant to openly embracing the development of black farming talent and shared ownership of their enterprises. 

The solution lies in partnership – those unwilling to genuinely partner should not have the distinct privilege of owning land in South Africa.

Inequality is not the enemy, opportunity theft is

Inequality is a natural phenomenon. Take two brothers born into a loving and supportive home. For whatever reason, one brother chooses to work hard, make his own luck and build something of value and becomes wealthy. The other brother prefers living a stress-free life, travelling and working as little as he can. Many of us know these two brothers. Neither brother is better – but their difference will manifest in terms of economic inequality. The first brother will be wealthy and the second comparatively poor: the gap between their wealth, their inequality.

Nobody should penalise the first brother for that inequality existing. Nobody would be justified in taking from the first brother and giving to the second in order to level the playing field.BUT, the scenario painted above is perfect. Our society does not mirror the loving and supportive household. In South Africa, inequality is as much a product of Apartheid and opportunity theft as it is of the differences in where people invest their time and energy.

BUT, the scenario painted above is perfect. Our society does not mirror the loving and supportive household. In South Africa, inequality is as much a product of Apartheid and opportunity theft as it is of the differences in where people invest their time and energy.A child born into a poor family in South Africa today is going to be on the wrong side of inequality through no fault of her own and is going to find it harder than is fair to get to the other side. This is NOT fair, and in this case, something must be said for the role of the state in working to mitigate the injustices of the past that hold people back today.

A child born into a poor family in South Africa today is going to be on the wrong side of inequality through no fault of her own and is going to find it harder than is fair to get to the other side. This is NOT fair, and in this case, something must be said for the role of the state in working to mitigate the injustices of the past that hold people back today.Education, Healthcare, Transport, Internet Access, Small Business Support are all examples are areas where the state can use taxes to improve access to opportunity for all South Africans.

Education, Healthcare, Transport, Internet Access, Small Business Support are all examples are areas where the state can use taxes to improve access to opportunity for all South Africans.

Government should never take money from one person who is productive, simply to give it to another who chooses not to be productive. We must never incentivise people to down tools and live on welfare: our European friends have tested this for us, and it does not work.

The above, however, does not extend to the very basic grants that the state pays to the poorest members of our society. The child support grant and the old age pension are the two best examples: these ‘transfers of wealth’ are to ensure that nobody in South Africa lives in such extreme poverty that they cannot feed, clothe and house themselves (and many would contest the adequacy of these meagre amounts to assure that).

In short, inequality is not the problem – the obsession with inequality is diversionary – the real problem is the number of people who find it so very hard to break out of their particular circumstances. Luck can favour some, but it cannot favour all – for that we need the help of the more mortal, ever more fallible: good government.

Opinion: The 2015 Kham Judgment

Disclaimer: I am not legally qualified.

The onus on the IEC with respect to proof of residence

The way I read this judgment, 5(c) can be summarised as requiring that the IEC “ensure that the voter is registered in the VD where they are ordinarily resident”. [59]

In my opinion, 5(c) can be broken down into:

  • the Electoral Commission is obliged to obtain sufficient particularity of the voter’s address [65], [68], [118]
  • to enable it to ensure that the voter is at the time of registration ordinarily resident in that voting district. [64], [66], [92], [117]

I find that [117] & [118] when compared with [65] & [66] are contradictory:

“The IEC is also labouring under a misapprehension, which this judgment should help to dispel, that it is obliged to verify voters’ addresses when they register. That is incorrect. What they are obliged to do is obtain sufficient information from the voter as to their ordinary place of residence, to ensure that they are registered in the correct voting district and correct ward.” [117]

“the IEC must endeavour to ascertain from the person coming to register an address, where they have a physical address, or some detail that will serve as an address for the purposes of the roll. But if there is none then, provided they are registered in the correct ward, they must be registered and the absence of an address does not affect the validity of the voters’ roll.” [118] (The judgement may erroneously be referring to “ward” here instead of “voting district”).


“That obligation may not have required the chief electoral officer to undertake an investigation of the accuracy of the address given (although, in a society where one cannot lawfully acquire a mobile phone without providing such proof, one wonders why not), but it certainly required that the information given in regard to the voter’s ordinary place of residence had to be sufficiently clear to ensure that the voter could be accurately placed in the correct voting district. A generic address, whether that of an informal settlement, such as Crossroads in Cape Town or Bester’s Camp in Durban, or that of an upmarket suburb, such as Constantia in Cape Town or Morningside in Durban, is simply insufficient for this purpose.” [65]

“When a voter comes to register as such, it is for the IEC and its officials to procure as much information from that voter as is necessary to enable it to perform its statutory obligation and ensure that the voter is registered in the correct voting district and hence, for the purpose of municipal elections, in the correct ward. In almost all cases this will be relatively easy but in some instances it will present challenges. It is the IEC’s responsibility to resolve those challenges.” [66]

If a generic address [65] is not considered sufficient, then how can no address [118] be considered acceptable?

While I do not believe that the IEC could be reasonably expected to verify the address of every person registering to vote, and neither does the Judgment, registrants will have to provide enough information to make it clear where they are ordinarily resident and where they should be registered. Whatever this information is – whether an address or not, should be recorded.

Indeed, the IEC cannot meet its obligations in 5(c) if it has no detail whatsoever upon which to base its decision to register a person in a particular voting district.

Providing voter addresses to candidates

My reading of 5(d) can be summarised as reminding the IEC that is obliged to comply with the Electoral Act, 16(3) in particular. [37]

In my opinion, the specific wording of 5(d) in the judgement fits the by-election related context of the case – and provides clarity with respect to to 16(3) in that context. [74],

However, it also re-asserts that the IEC is obliged to comply with 16(3) in full. This assertion seems to be supported by the IEC’s own pre-emptive remarks to the effect of provides addresses in all future voters rolls supplied to “contestants”.

What is of specific relevance to political parties is that 16(3) naturally follows from 16(2), and 16(1) and their applicability is thus also reasserted by this judgement.

The specific value is that 16(3), when read with 16(2) and 16(1) compels the IEC to:

  • provide a copy of the Voters’ Roll
  • as it exists at that time
  • including addresses where available [51], [118]
  • to any person or any political party contesting the elections
  • who [have] paid the prescribed fee

Thus, any person or political party contesting the elections should at any time be able to request the Voters’ Roll as it exists at that time and be supplied with a copy that includes addresses where available. [53]

Noteworthy sections of the judgement

“To construe section 15 in the restrictive fashion suggested by the IEC might advance bureaucratic interests, but it is not consistent with its broader obligation to create an environment in which free and fair elections can take place in which all qualified citizens may participate either as candidates or voters.” [52]


“The applicants’ right to relief is not constrained by the need to show that the result of the election would have been materially different had the incorrect registrations not occurred.” [56]


“In August this Court stressed the importance of permitting all citizens to vote in the absence of any justifiable limitation of that right. It accordingly set aside the failure by the chief electoral officer to register prisoners so as to enable them to vote.” [60]


“The applicant was entitled . . . to stand for election in fair and democratic conditions, regardless of whether ultimately he won or lost.” [84]


“The focus must be on the impact that this had on their exercise of the right to stand for public office. It is not on whether they would have won or lost had the arrangements for the by-elections been different and not suffered from the flaws of which they complain, but on whether they were seriously hampered in their participation in the electoral process.” [85]


“All that can safely be said is that the independent candidates were constrained to fight these by-elections under the shadow of uncertainty occasioned by the registration of an unknown number of voters who were not entitled to vote and an inability to identify who these were or to do anything about it.” [88]


“For example, in a national election, the fact that voters, otherwise qualified to vote, are registered in the incorrect voting district, may be of less significance than in a municipal by-election. But late delivery of voters’ rolls, or delivery of rolls with important information missing, may assume even greater significance at the national than the local level.” [90]


“These seven by-elections fail that test. They were conducted against the background of fears that voters had been wrongly registered in wards where they were not ordinarily resident and not entitled to vote. It transpired that these fears were well founded. The IEC has proffered no satisfactory explanation for this occurring, seeking instead to shelter behind a contention that it is not obliged to verify voters’ addresses. […] All that can be said is that an election conducted when there is a serious question as to the reliability of the voters’ roll cannot be described as free and fair.” [92]


“But it is unnecessary in the light of section 16(3) to reach a firm conclusion on this question and I would hesitate to do so without further enquiry into the electoral systems of other democratic countries and the requirements for the preparation of voters’ rolls there. Here, the IEC was in breach of its obligations under section 16(3) of the Electoral Act in not furnishing segments of the voters’ roll with addresses where those were available.” [94]


“Overall the balance must come down on the side of electoral integrity.” [112]


“The only other problem mentioned by the IEC is that we are approaching the Christmas holiday period and people may go away. But it rejected that as a ground for postponing the December by-elections in 2013, so it should not be able to rely on it now.” [119]

My message to whites who think Maimane has sold the DA out

Let’s start by accepting that voters are emotional beings*.

Our votes are cast almost exclusively on the basis of emotional drivers: anxiety, fear for some; suspicion and anger, perhaps, for others.

There is no such thing as a rational voter who makes their choice upon the dispassionate assessment of the relative pros and cons of each party.

Second, there is no such thing as a ‘race band-wagon’. Race is a real and pervasive issue in this country. You might feel peeved about it to the point where you buy into the idea that the DA has jumped onto the ‘band-wagon’ but you are in the wrong position to be saying so.

Us whites too easily forget that the momentum of opportunity theft that Apartheid instituted against blacks is still crippling. To make it worse, despite BEE and similar policies, the momentum of white and minority advantage is still very strong. That’s not an opinion it’s a fact: look at income growth by race group since 1994.

Source: The Economist

The unfortunate reality 20+ years on, is that the structural legacy the evil system bequeathed us is still alive and well.  Black South Africans are largely still poor and short on opportunity, and thus understandably frustrated and angry.

Against this backdrop, incidents of white on black racism are incendiary. I’d go as far as to say that there isn’t such a thing as reverse racism, and that black on white ‘racism’ is more like hatred than racism – because racism as we know it has that special aspect of racial superiority weaved into it. When Sparrow made her comments, she wasn’t just saying ‘I hate you’, she was saying loudly, ‘You are less human than me.’ That’ll make a person furious.

In a country with as much frustration as we have, people need somewhere to direct their outrage – Sparrow et al were good for frustrated blacks, and President Zuma is the old favorite of frustrated whites.

So, Mmusi Maimane is not jumping on any band-wagon. We have a problem in this country that is not being made any better by the gross mis-management of the ANC-led government.

Unfortunately that same problem creates circumstances ripe for blaming all via race on whites (and minorities), and stoking racial tensions for political ends.  Until we face this issue head on, South Africa will not be able to turn the corner and start moving forward again.

Mmusi Maimane is doing what few South African political leaders ever do – he is leading.  He is leading his party, and he is trying to lead South Africans.

We have some way to travel as a nation to get past the drag anchor of race and the impact that it has on the vitality of our democracy.  I have a renewed sense of optimism about our future knowing Maimane is leading us on that journey.

So, you really have two choices as a white voter:

  1. If you are an unrepentant racist, then find a conservative, backwater party like the FF- who will accommodate your views.  They will never get big enough to make a difference, and you will end up on the wrong side of history.
  2. Accept that the only way is forward, confront your feelings and beliefs about race, consider them in the context of you and your children – try to empathise: how would I feel if me or my children were spoken to like that, or how would I feel if I had to live in those conditions every day of my life? Then, cast your vote for a party who you believe will most effectively tackle the challenges that confront our nation.

* This is not opinion either, but solid neuroscience.  The best resource for understanding this better is “The Political Brain” by Drew Westen.