Cryptocurrencies, such as Bitcoins, are becoming more and more prevalent in our lexicon today, the broad common understanding being that it is a financial system that is based on technology. However, for most of us, there is still a lot more to know and understand how cryptocurrencies work, and how such a technology can affect social relationships. Enrico Petracca, along with Shaun Gallagher, in their new paper reveal that while technology is an important aspect of cryptocurrencies, the very humane emotion of trust, which is the basis of social and interpersonal relationships, is still at the core of the cryptocurrency enterprise.

To have a little context, Bitcoin, the first and largest cryptocurrency, was introduced soon after the 2008 financial crisis in a period when distrust towards financial institutions was very high. The advocates of cryptocurrencies envisioned a financial system where reliance on these institutions would become obsolete due to advancements in computing (i.e., cryptography). In recent times, with their increasing popularity, the general belief is that cryptocurrencies, being reliant on technology, are indeed replacing the need to trust financial intermediaries.

This paper by Enrico and Shaun, however, shows that fundamental essence of trust, as experienced by individuals in their dealings with other people or organizations, is still at the core of the cryptocurrency enterprise, although in a different form. Technology has not at all replaced interpersonal relationships. According to Enrico, “This acknowledgment allows us to read cryptocurrencies through the philosophical lens of the “socially extended mind,” that is, as institutions that extend individual cognitive processes not by means of technology but by means of certain forms of social interactions. In other words, if we think that cryptocurrencies perform certain cognitive functions, e.g. the creation of an immutable history of transactions, this is made possible mainly by their being social and not just technological phenomena.”

Publication: Petracca, E., Gallagher, S. Trust and reliance in the cognitive institutions of cryptocurrency. Mind Soc (2024). https://doi.org/10.1007/s11299-024-00302-z