Bitcoin Group Bias Illusion Authority

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When the opinion of the highest paid person (HIPPO) is never questioned – ignorelimits.com

As discussed in the previous article on biases, we can understand some of the misconceptions about Bitcoin by looking at different cognitive biases and their effect on people’s understanding of the Bitcoin asset and the Bitcoin network.

“A cognitive bias is a systematic pattern of deviation from the norm or from rationality in judgment. Individuals create their own “subjective reality” from their perception of the entrance. The construction of an individual’s reality, and not the objective input, can dictate his behavior in the world. “-Wikipedia

These biases cause systematic errors in what is said and what is believed about Bitcoin.

Understanding these biases can help us educate, inform and respond.

Illusion of authority

The illusion of authority bias is “the tendency to attribute greater precision to the opinion of an authority figure (unrelated to its content) and to be more influenced by that opinion”.

Bitcoiners don’t tend to have delusions of authority over old government and financial authorities.

However, the general population holds this prejudice and often believes squarely in the authority of a CEO, president or government figure, or a prominent figure in today’s financial and monetary system.

We’ve seen everyone from Warren Buffett to Peter Schiff to Ray Dalio, Elizabeth Warren, Christine Lagarde and Gary Gensler speak out and spread false information about Bitcoin.

And yet, many people trust these public figures.

An implicit part of the authority of these public figures is that authority is built on the thinking of a certain group or groups.

Compliance and bias within the group

There are two main biases related to groups that have similar belief results when it comes to Bitcoin misconceptions.

Group thinking, which is a type of conformity bias, is “the psychological phenomenon that occurs within a group of people when the desire for harmony or conformity in the group results in an irrational or dysfunctional decision outcome.” .

Compliance biases – matching attitudes, beliefs, and behaviors to group norms, politics, or like-mindedness – explain the incentive to print more money through MMT because debt purchases federal stimulus, grants and equity appreciation have become normalized and are harmonious for so many groups of people. However, many believe that it is irrational to print so much money and devalue the currency by reducing its purchasing power. This view has traditionally been maverick.

In-group bias is “the tendency of people to give preferential treatment to others whom they perceive to be members of their own groups”.

In recent history, Keynesian economists, government and financial authorities were the primary financial authorities, and most people were socially predisposed to believe in the group standards of these authorities. These group biases overlap with social circles, friends, family and co-workers. This makes it difficult to change or think differently, due to social ostracism or disagreements that can arise.

Group prejudices also often lead people to make general and false statements that match a group norm. The group norm also often vehemently denies ideas or systems if the ideas are outside their group or group’s authority.

Devaluation bias external to the group and reactive

Bias not invented here is another type of intra-group bias and corresponds to “aversion to contact or to the use of products, research, standards or knowledge developed outside a group”.

Reactive devaluation bias “occurs when a proposition is devalued if it appears to come from an antagonist.”

Everything about Bitcoin – any possible problem – is dealt with by the authorities and negatively and magnified, seemingly without critical thinking.

Additionally, as the authority of the authority figure is based on consensus and group thinking, the anti-Bitcoin words and opinions of authority are further amplified within groups that rely on their authority.

Regardless of what each person might think individually or their doubts, authority figures are always beholden to the primary audience they address and are expected to speak within that group standard.

Why authority and group prejudices are so prevalent

First, biases in general allow us to reduce our cognitive load.

The circular nature of authority and group prejudice may seem confusing, but it’s simple: we humans take a lot of shortcuts in our thinking. Trusting someone else or an institution or authority takes responsibility and cognitive load from us individually. Going with the “wisdom of the crowd” makes sense and is easier.

We can just believe what they say.

We don’t need to do our own research if we trust an authority or a group.

We don’t need to change the way we think or learn new things.

It is easier to agree with the group and the authority of the group.

Also, a large number of people are happy with the increasing numbers in their fiat portfolio and the value of their homes and do not want to look at the reality of monetary expansion, inflation, debt and how which affects those who have less.

The norms of the group and the assurances of the authority feel good.

In addition, the network effects of the most common beliefs overwhelm us and allow us both to justify belief in mass opinion. After all, that’s what almost everyone says and believes.

The more people there are who have historically adopted a way of thinking, the more likely others are to adopt that same way of thinking.

If we zoom out, this massive adoption of thought is actually a plus for Bitcoin, because Bitcoin facts are stronger than statements that induce fear, doubt, and uncertainty.

How to eliminate authority and group biases

To help others break down their authority bias and group bias, there are a few steps you and them should take. Some of Bitcoin’s aphorisms apply here, with caveats.

Examine your confirmatory biases that apply to authority and groups, and set them aside. Look for sources and information that conflict with your own views. Do your own research (DYOR) on all points of view with credible and well-researched sources. It may seem uncomfortable, because it will sow doubt. However, doubt is not a black and white agent; many so-called facts are probabilistic and uncertain. If you are a Bitcoiner, your broader research will help you better understand the broader viewpoints. If you are not a Bitcoiner, your Bitcoin research will help you see issues with current fiduciary authorities and group standards.

3. Most importantly, again, challenge your authority and your group’s prejudices. Understanding why you believe what you believe and why you don’t believe the conflicting views of other groups and authorities engenders robustness, resilience, and reasonable rhetoric when your views are challenged.

Decrease in Fiat FUD network, increase in Bitcoin fact network

The network effects of the long-standing use of fiat currency, the historical temporal authority of its complex system, and entrenched authoritarian views have a huge effect on misconceptions around Bitcoin.

As each of us helps dispel these myths in a reasonable, authoritative, and judicious manner, the growing group acceptance and network effects of Bitcoin understanding will increase.

Conversely, Bitcoin itself will remain under no authority or illusion of authority; it will remain decentralized.

Person by person, group by group, city by city, nation by nation – Bitcoin adoption will grow with or without centralization of authority and its biases.

This is a guest article by Heidi Porter. The opinions expressed are entirely theirs and do not necessarily reflect those of BTC, Inc. or Bitcoin Magazine.

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