Dear Rabbi Zahavy,
My friend says I should buy bitcoin. He predicts I’ll make a big profit. He says that even though the value of the cryptocurrency recently has risen dramatically relative to the dollar, it’s not too late to buy. Should I trust his advice? And honestly, I do not understand how the currency works. Can you give me some insights? Should I trust bitcoin?
Taking Risks to Get Rich in Ridgewood
Dear Taking Risks,
I checked thoroughly and want to let you know that my research shows that the Talmud has no teachings about bitcoin. The Talmud is an ancient literature. Bitcoin was invented quite recently. Never the twain shall meet.
And although I worked for years in the financial services industry, at big banks and at hedge funds, I did so as a technology expert, not an investment adviser. I have no credentials to give financial or investing advice. And if the truth be told, I am not very good at following the sage advice I received over the years from the real money experts. Accordingly, please do not construe anything I say here as guidance for your investing. I will not and cannot tell you what to buy or sell or when to do so.
But while I researched and pondered what the Talmud might say about your inquiry — as if prophetically the Talmud could know about bitcoin — I did realize there are some striking similarities between the two systems — between traditional religion and the blockchain technology that underpins all cryptocurrency.
I see a few analogies between faith and bitcoins. In both realms people face risks, as they are frequently beset by fraudulent claims and actions. In both realms people need to establish and identify ironclad trust in the authenticity of claims.
I’ll give you a few illustrations of my evocative analogy between the bitcoin cryptocurrency blockchain and the Judaic chain of traditions.
Consider first the limitations on the quantity of the objects we are looking at. Bitcoin is mined by a complex computational process. And there is an absolute limit on the number of authentic bitcoins that can ever be created. The limit of 21 million bitcoins will be reached in 2140. About 1800 bitcoins are being mined each day between now and 2020.
Loosely analogous, the content of our Judaic faith already was revealed long ago. In Judaism we say that after the events and ages of the divine direct revelation of the Torah and of ancient prophecy, no more basic faith content (“currency”) can ever be issued.
The main productive analogy, as I see it, is how each system controls the authentic use of its valuable core materials — the bitcoins and the Torah — and how both realms deter fraudulent misrepresentation.
In the founding document of the bitcoin system in 2008, Satoshi Nakamoto, its mysterious founder, set forth several principles. He proposed a solution for authentication of the use of the currency. The main fraud challenge to that system — is what he called the “double-spending problem” — the risk that people will spend the same coin twice for different purposes. To guard against this, the system uses a peer-to-peer network that keeps track of all records of an authentic chain of the transmissions of the units of the currency.
The bitcoin network timestamps transactions by adding them into an ongoing chain of “hash-based proof-of-work” — essentially, a list of coded transactions of every coin, a list that cannot be messed with. The record cannot be changed without redoing the “proof-of-work.”
So the longest bitcoin chain of records serves as the authentic proof of the sequence of bitcoin transactions (events) that were witnessed in the world. And the chain has proof that it came from the largest pool of computer CPU power.
Majority opinion rules in the system of bitcoins. The authenticity in the system is guaranteed, as long as a majority of the computer power is controlled by nodes that are not cooperating to attack the bitcoin network.
The majority of members participating in the system will generate the longest blockchain transaction records and outpace all attackers. In this network, member nodes can leave and rejoin at will. When they rejoin, they accept the longest proof-of-work-records-chain as proof of what happened while they were gone.
So what kind of a loose analogy can I make from this system to Judaism? Here’s my shot. The revealed Torah — both written and oral — constitutes our coins. And the rabbis make up our network nodes. The authorized interpretations of rabbis create a large record of transactions — a chain of our traditions — that is authenticated by all the nodes — all the independent rabbinic authorities of our religious system — agreeing to accept as true the contents of the latest chain of transactions — the current set of interpretations upon which all concur.
This is contained in those works of our rabbinic literature — commentaries, codes, and responsa that are deemed authoritative by the majority of our rabbinic “nodes” with the greatest computational power — with the highest expertise in talmudic learning.
Wait. You say that this sounds like an imprecise and stretched analogy. A soft cultural system like a religion cannot in fact be compared point-by-point with a hard-numerical ledger system of a cryptocurrency.
I totally agree.
My main claim here is that there is a basic similarity between the blockchain that governs the authenticity of bitcoins and the Judaic-chain that regulates the validity of Judaic traditions. I hope you will accept that as a helpful comparison to start with — subject now to many further thoughts and discussions.
I suppose you still would like to know what I think about you buying bitcoins. I admit that I have converted some of my dollars to bitcoins. It wasn’t easy to figure out how to set that up. And when I did my initial purchase of bitcoins, my bank flagged that as a fraudulent transaction, on the assumption, I suppose, that I really would not be silly enough to go ahead and buy cryptocurrency. I had to call my bank and confirm to them that I did want to do that.
Whatever you do, please consider these known facts. Bitcoins are a volatile currency. Because they are an e-currency, they are especially exposed to cyberfraud. Multimillion-dollar losses have been recorded in nefarious bitcoin hacking attacks. If you buy in, because of these vulnerabilities, you may lose your money quickly. Or you may gain significantly. If you are a risk-averse person, you for sure should shun this area of investment. But if you are a gambler, you may want to investigate it further.
As I said, I give no buy or sell advice in this column. But I do hope you will find reliable monetary gains in your investments in currency — and find authentic spiritual wealth in your investments in the eternally valuable and stable currencies and contents of our authentic Judaic traditions.
Dear Rabbi Zahavy,
I recently experienced a sudden major medical episode. I was hospitalized and treated and now I am recuperating. I opted at first not to make my issues public, by neither telling my friends directly, nor by posting about it on social media.
However, I do see that some of my friends post information about their medical travails on Facebook. What’s your advice on this matter?
Recuperating in Ridgefield
You know by your experience that serious illness can be dramatic and terrifying to the sick person and to his or her family.
You realize that in the hospital you lose control of your freedom of movements, of your repose, and potentially of your destiny. You face your mortality.
For many people, the last thing they want, or need, is an onslaught of inquiries from friends and acquaintances about their health and well-being. They want the space to begin to heal and to resume normal life.
We all realize that there are many variants to the situation that you bring up. Some health issues are quickly resolved for the better. Others take extended time to be treated. Still others sadly have no positive prognosis. Much of what you need to consider depends on your medical circumstances.
And keep in mind that there are many contrasting personality profiles in our world. If you are a private person, you may want to keep your issues private, to help yourself keep your balance. If you are a person who thrives on attention, you may find that publicizing your situation is more beneficial for your equanimity.
In either case, the Talmud says that when people visit the sick, that helps them get better. You may not easily accept this generalization, preferring your privacy. But you ought to consider that it has some common-sense merits to allow your social connections to continue as previous.
And you may want to consider the matter of timing. In the first acute phase of an illness, it may be best to keep control and tell as few people as necessary. After things have stabilized, it may be good, helpful, and comforting to know that you have told your friends and that they come to see you or send you their support.
And all this discussion pertains whether you are considering informing people directly or via social media.
And by the way, do you want people to pray for your recovery? Because when people become aware of your illness, some will offer their prayers.
There are those who will argue that prayers for a specific sick person have no special power. Yet on the other side of that argument, there are those who firmly believe that prayer-at-a-distance for a specific sick person is effective in helping that person recover. I would allow for the possibility that it is true and thank those who pray on your behalf for their support.
Final thought. There are no right or wrong rules in this circumstance. Decide on a course of action based on your own circumstances and instincts. And above all, may you have a complete and speedy recovery.
The Dear Rabbi Zahavy column offers mindful advice based on Talmudic reasoning and wisdom. It aspires to be equally open and meaningful to all the varieties and denominations of Judaism. You can find it here on the first Friday of the month. Please mail your questions to the Jewish Standard or email them to firstname.lastname@example.org