Flawed research drives harmful Bitcoin policies

Speakers at the Bitcoin Amsterdam 2024 conference have highlighted the far-reaching consequences of misinformation in academic research on Bitcoin.

During the “Beyond Resistance Money” panel discussion on day two of the conference, speakers said that academic inaccuracies have misled and continue to mislead the media, contributing to misguided government policies and harmful regulations.

The Bitcoin (BTC) advocates detailed how flawed studies on BTC emissions and mining practices have driven erroneous narratives in journalism and policymaking.

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Flawed academia, public misperception

One important issue discussed was the role of flawed academic research in spreading misinformation about Bitcoin.

Andrew Bailey, a professor at Yale-NUS College and senior fellow at the Bitcoin Policy Institute, highlighted a specific issue in an influential academic paper that inaccurately reported BTC emissions data. He said:

“The problem, I’m afraid, is academics. And the wrong or even damaging things they say about Bitcoin […] Academics have been wrong about Bitcoin, but nobody reads this stuff. Right? Right?”

Bailey pointed out that the paper contains a “unit error in the chart” that has not been corrected, even though it continues to be cited as factual. He emphasized that such mistakes can have a lasting impact on public understanding of Bitcoin.

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Journalism as a loudspeaker for misinformation

Bradley Rettler, associate professor of philosophy at the University of Wyoming, added that journalists often lack the time to verify or deeply understand academic sources, further spreading these inaccuracies.

According to Rettler, the reliance on academic papers by journalists, who may not have the resources to become subject-matter experts, contributes to the problem:

“So the journalists read these academic papers, and they translate them into everyday parlance and the problem is, when you start with crap, you end up getting crap.”

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Harmful regulations built on flawed data

Craig Warmke, a member of the Bitcoin Policy Institute, warned that misinformation has real-world implications, particularly in the realm of policymaking:

“Policymakers and regulators don’t have time to read these academic papers, so they read the journalism and this has resulted in some attacks on BTC mining, self-custody and financial privacy.”

Warmke stated that this pattern has resulted in restrictive proposed legislation, “especially in Sweden to tax the BTC mining industry out of existence.”

He also said there is an “attack on software developers working on technologies that promote financial privacy.” 

“These are serious issues. The problem has bled … through to journalism and to policy making and law enforcement and regulators and bad research on BTC and academia is largely to blame and so is the absence of the research.”

Warmke suggested that while academia has historically worked against Bitcoin, it is time for academics to start supporting the cryptocurrency.

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