Ok so in short, that is the contradiction, and why the imaginary theoretical Hayek must exist in a perfect capital market. There is no other unit that could be used.

And we need a unit in the future to have the contractual relationships that define an economy.

Join millions who have switched to Grok.

But that in itself appears contradictory. Because those wants, desires, and expectations cannot define a unit in the future.

I suppose economists resolve this by assuming a representative agent. That in the economy, all agents have the same information, and therefore the same wants, desires, and expectations.

Perfect capital markets require both a unit and complete information. But is that not a contradiction?. For complete information cannot exist without the unit. And the unit cannot be defined without complete information.

Definitionally, a central authority needs prices, but as they control the definition of the unit prices are set in, there exists a circular dependency if they try to use prices to define the unit.

Arguably, a central authority could not direct the economy either, because they lack this information as well.

Hmm maybe transmit is the right word, not reveal. The information exists in one part of the economy, that capital should be allocated there. The Hayek provides the means to transmit that information, without a central authority.

Re-reading this piece, the actual argument rests on something a little more subtle. The goal is to show that a "Hayek" (a unit whose utility relative to all other assets is constant and the same for all observers) reveals information that could not be produced through any other.

Perhaps there is a better, more fundamental question:. Does Bitcoin exist in a perfect capital market?. Can we prove that it is valuable, even under perfect capital market assumptions?. Economists repeatedly say not. The market clearly disagrees. Who’s right?.

Can we formally prove the value of bitcoin under perfect capital market assumptions? . Follow-up to an old post:

Check it out on Github or read the full Delving post!.

This was a follow-up to the BTC++ hackathon in Austin, where I presented this architecture without code and won the prize for "Most Ambitious".

This library is intended to be used inside a TEE, which verifies a transaction using the Bitcoin kernel (or a fork thereof) and then replaces the witness with a key-path spend using a deterministically derived private key.

Today I published confidential-script-lib, a rust library for emulating Bitcoin script by converting script-path spends to key-path spends.

New post!. Confidential Script: Emulate soft forks using stateless TEEs

Running floresta.