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I finished the second version of my book!

## The Praxeology of Privacy

### Economic Logic in Cypherpunk Implementation

Austrian economists theorize but cannot build. Cypherpunks build but lack theory. This book synthesizes both traditions into a unified strategy for making the state irrelevant.

Three axioms. Twenty-one chapters. One conclusion: cheap defense defeats expensive attack. When theft becomes unprofitable, the state withers.

Public Domain. v0.2.0. Published on Nostr.

Thanks a lot to Stephan Kinsella and Eric Voskuil for their tough feedback on the first version, please join them in demolishing the logic of this second edition and help me make the arguments better!

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Table of Contents

Preface

Austrian economists theorize but cannot build. Cypherpunks build but lack theory. This book synthesizes both to make the state irrelevant.

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Part I: Introduction

Chapter 1: The Nature of Privacy

Privacy is selective disclosure, not hiding. Breaking adversary observation through the OODA loop is strategic defense. Cheap privacy defeats expensive surveillance.

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Chapter 2: Two Traditions, One Conclusion

Austrian economics and cypherpunk practice converge independently on privacy's importance. Theory explains why; code demonstrates how. This book synthesizes both traditions.

nostr:naddr1qqgxzctpxvenverrx93rwv35v3snzqgwwaehxw309ahx7uewd3hkctczyzm7669svt0xkjsju50a22zurc0qa589z2xd4yatzx6p2z64a5e0cqcyqqq823c4p7jlc

Part II: Philosophical Foundations

Chapter 3: The Action Axiom

The Action Axiom proves privacy is structural to human action. Deliberation is internal; preferences are subjective; information asymmetry is inherent.

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Chapter 4: The Argumentation Axiom

Argumentation ethics demonstrates self-ownership through performative contradiction. Denying it while arguing presupposes it. Privacy rights follow directly from self-ownership.

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Chapter 5: The Axiom of Resistance

The Axiom of Resistance assumes systems can resist control. Mathematics, empirical evidence, and similar systems support this well-grounded but non-self-evident assumption.

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Part III: Economic Foundations

Chapter 6: Information, Scarcity, and Property

Information is non-scarce and cannot be property. Privacy is protected through self-ownership, physical property rights, and voluntary contracts, not intellectual property.

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Chapter 7: Exchange Theory and Privacy

Privacy enhances exchange by protecting deliberation and enabling negotiation. Surveillance distorts prices and chills transactions. Better privacy means better functioning markets.

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Chapter 8: Capital Theory and Entrepreneurship

Privacy infrastructure is capital requiring present sacrifice for future capability. Entrepreneurial discovery drives innovation. Markets coordinate heterogeneous privacy tools most effectively.

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Chapter 9: Monetary Theory and Sound Money

Sound money emerges spontaneously from markets, not decrees. Bitcoin implements digital soundness with fixed supply and censorship resistance; privacy requires additional tools.

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Part IV: The Adversary

Chapter 10: Financial Surveillance and State Control

Financial surveillance enables state control through observation. CBDCs complete the architecture. Privacy breaks the OODA loop at observation, making theft unprofitable.

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Chapter 11: Corporate Surveillance and Data Extraction

Corporate surveillance extracts behavioral data for prediction products. State and corporate surveillance are deeply entangled. Markets are responding to growing privacy demand.

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Chapter 12: The Crypto Wars

The Crypto Wars pit states against privacy technology. Mathematics ignores legislation. Developers face prosecution. The fundamental conflict is permanent and intensifying.

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Part V: Technical Implementation

Chapter 13: Cryptographic Foundations

Cryptography provides mathematical privacy foundations: encryption, hashing, and digital signatures enable trustless verification. Implementation bugs and human error remain the weakest links.

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Chapter 14: Anonymous Communication Networks

The internet leaks metadata. VPNs help locally. Tor distributes trust through relays. Mixnets defeat global adversaries. Choose tools matching your threat model.

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Chapter 15: Bitcoin: Resistance Money

Bitcoin solves double-spending without trusted third parties. Sound money enforced by code. Base layer privacy requires additional tools like Lightning and coinjoin.

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Chapter 16: Zero-Knowledge Proofs

Zero-knowledge proofs enable verification without disclosure. SNARKs, STARKs, and Bulletproofs make different tradeoffs. Deployed in Zcash and rollups; broader adoption developing.

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Chapter 17: Decentralized Social Infrastructure

Nostr solves identity capture through cryptographic keys users control. Relays compete, moderation is market-driven, and the protocol extends beyond social posts.

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Part VI: Praxis

Chapter 18: Lessons from History

DigiCash, e-gold, and Silk Road failed through centralization and poor OPSEC. Bitcoin succeeded through decentralization, open source, and properly aligned economic incentives.

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Chapter 19: Operational Security

Operational security prevents adversaries from gathering compromising information. Threat modeling guides defense. Human factors are the weakest link. Perfect OPSEC is impossible.

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Chapter 20: Implementation Strategy

Start with honest assessment. Build progressively from basics to advanced. Find community. Privacy is not a destination but ongoing practice. Progress matters.

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Chapter 21: Building the Parallel Economy

The parallel economy grows through counter-economics. Cheap defense defeats expensive attack. When theft becomes unprofitable, the state withers. Build. Trade. Resist.

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Great! Do you have an audiobook version?

Ah that's great, thanks.

I had a really good christmas here in Paraguay thanks.

How was your's?

Merry Christmas Nostr!

They seem to be working for me.

I will have one of the devs message you.

There may be something specific to your set up.

We have two ways of paying for content on the internet:

One is β€œfree” content, where we actually pay with our time, our attention, and our data. We do this inside platforms engineered to keep us watching longer than we intended.

The other is subscriptions, where we commit to ongoing payments for services we may no longer want. We do this inside platforms deliberately designed to make cancelling difficult.

Both models are hostile to users and corrosive to creators.

The solution is not new. It is the oldest economic model humans have ever used:

You pay for something, and then you receive that thing.

This is now possible with Bitcoin, Nostr and @Fanfares.

Fanfares.io

A sovereign AI is something you run yourself, or have hosted for you by someone you trust.

It reads your npub, your history, and your web of trust.

It learns how *you* discover truth.

When you search, it doesn’t return what’s popular or profitable for advertisers.

It returns what has proven meaningful inside your trust graph.

No nudging and no algorithmic mind control.

Just independent search and curation.

The interesting part comes next.

The research this AI does on your trust graph can be shared, at a cost of a few sats,

with other sovereign AIs doing the same work for other people.

Not pooled models.

Not shared data.

Just signals.

Over time, the AIs that are most useful get queried more,

earn more sats and can justify more processing power.

When they recommend Fanfares content that proves valuable,

referral splits route value automatically.

Users who think well gain better intelligence.
AIs that serve well gain more trust.
Signals that align with reality propagate.
Noise becomes uneconomic.

What emerges is an intelligence layer with no centre to capture. It can be composed of sovereign nodes, human and machine, each accountable, each optional, each competing to be useful.

This is what happens once discovery, identity, and value are no longer owned by platforms.

GM Nostr!

The weekend is here!

We can all see where things are going.

Digital ids will be required to access platforms.

They will be tied into back accounts.

Money will be controlled, platforms will be controlled and speech will controlled.

Anyone that says anything they don't like will be suppressed by the algorithm and demonetised by the platforms.

Bitcion and Nostr are freedom!

Creators listen up.!

Your sponsors can have their payment processing facilities taken away from them. This can be used to pressure them into not sponsoring you.

At Fanfares we are digging the well before the water supply gets turned off.

Fanfares.io offers direct bitcoin monetisation per item of content.

No platforms, no transaction fees and no subscription slavery.

Bitcion is a currency. Let's use it!

This audiobook explains the potential of Fanfares to create a digital media economy using bitcion and nostr πŸ‘‡

https://api.fanfares.live/s/axRQkZ

Yes they are government bonds packaged up with a derivative contract and sold through the stock market in an equity wrapper.

This is what a bankrupt nation does when their two biggest lenders don't want to lend them any more money.

Have a look at a chart of the growth of ETFs since 2008. Compare that with the graph of total qe issuance.

perhaps that just means that the people who are lending to ecash mints are fools!

It is funny to watch Tether try to graft themselves onto the Lightning Network.

From their perspective it makes sense: Lightning is the most efficient, lowest-cost settlement rail in existence, and Bitcoin has already done the hard work of building it out.

If they can use Lightning to move their IOUs around, they can piggyback on the credibility of Bitcoin while preserving their own centralized power.

But the whole thing misses the deeper point.

Lightning is not just a network of payment channels; it is a network of conviction.

Bitcoiners run routing nodes not because they expect to get rich on tiny transaction fees, but because they believe in the mission.

So they don’t run their nodes with an economically viable model, most of them will be operating at a loss.

Every sat they forward means that they are expanding the reach of sound money.

That sense of participation, that alignment with a cause larger than themselves, is what makes the infrastructure resilient.

Try substituting a dollar proxy for that mission, and the ethos evaporates.

No Bitcoiner wakes up eager to donate liquidity and bandwidth to make Tether stronger.

Anyone operating a node that carries Tether will demand higher fees.

The difference is structural: Bitcoin routing is subsidized by belief, while token routing will always be mercenary.

This is why stablecoins will never truly compete with sats on Lightning.

They may succeed at moving volume for a time, but they will never summon a volunteer army.

Bitcoin nodes are happy to give because they are defending the hardest money the world has ever seen.

Token nodes will only give if they are paid, and they will want paying well.

That asymmetry ensures that Lightning will always be cheaper, more reliable, and more resilient for Bitcoin than for any imitation that tries to ride its rails.

The same thing has been seen with peer to peer network of Bitcoin to cash transfers.

Bitcoiners are happy to trade at spot, while anyone facilitating USDT trades are asking for a fee to complete a deal.

Does anyone have any short videos where people are complaining about the capture of centralised social media?

I will zap 10,000 sats for good ones.

Please post as a comment to this note.

I will be using them as part of a documentary film that I am making about Bitcoin and Nostr.

You can now publish your audiobook outside of the platforms, outside of the banking system and not give 75% of the revenue to Audible!

https://api.fanfares.live/s/axRQkZ