Lessons In Blockchain, Lessons in the Tao
What I’m Learning From This Little Known Technology
The Tao Te Ching says, “The best ruler is barely known to his subjects.”
In this stanza Taoist sage Lao Tzu wasn’t just talking about governance. He was pointing to a truth about life itself, namely, that the healthiest systems are those that guide without domination, that flow without a central choke point.
In nature, rivers don’t need a central committee to decide where they’ll go. They follow the terrain, adapt to the seasons, and redistribute resources where they’re needed. Taoist philosophy has always recognized that too much centralization, whether of power, information, or energy, stifles the natural order.
When I first encountered blockchain technology over a decade ago, it felt like I was stumbling upon a living, technological embodiment of the Tao. Here was a system without a king, without a central ledger, without a single point of failure. A global network that moves value like water flows downhill naturally, without coercion.
My Life on the Decentralized Frontier
As one of the first journalists to write seriously about blockchain and cryptocurrency, I saw firsthand the raw, untamed birth of a new kind of society—one where transactions were peer-to-peer, trust was distributed, and control was algorithmic rather than bureaucratic. It wasn’t utopia, but a possibility.
I wrote about innovators who were building what the I Ching might call “a village that has no walls”—a resilient, self-adjusting ecosystem that could evolve without being dismantled by one bad ruler or one corrupt institution. The more I reported, the more I recognized an echo of my Taoist studies: that life thrives when it’s allowed to self-organize.
Atlas Shrugged and the Tao of Galt’s Gulch
Ayn Rand’s Atlas Shrugged is a lightning rod that’s beloved by some, despised by others. But Galt’s Gulch, the hidden valley depicted in the book where productive people live free of state control, is essentially a decentralized enclave. It’s a place that symbolizes the refusal to pour your creative energy into a machine that exists to grind you down.
In my own thinking, Galt’s Gulch overlaps with a Taoist village where the land governs itself, where the people set their own rhythms, where no one waits for permission to live.
The difference?
Taoism’s decentralization is not about withdrawal in bitterness. It’s about rejoining the natural order after stepping away from the artificial one.
Rand’s heroes walked away to protect their sovereignty. Taoist sages walk away to protect their flow. In both, there’s an understanding that the central powers will not voluntarily give you freedom. Instead, you have to take it by building a life that doesn’t need their approval.
Decentralization in the Technological Realm
The blockchain is often misunderstood as merely a speculative market. But at its philosophical core, it’s a direct challenge to centralized gatekeepers—whether banks, governments, or tech giants.
It’s a living Tao Te Ching verse in code: “Governing a large country is like cooking a small fish. You spoil it with too much handling.”
Smart contracts, distributed ledgers, and decentralized autonomous organizations are technological manifestations of wu wei in action without unnecessary interference. A properly designed blockchain doesn’t need a central authority to verify trust. It just flows, validated by the whole rather than dictated by the few.
Why the Center Fails
Centralized systems rot because they hoard qi. The I Ching warns of stagnation: when power pools in one place, it stops circulating, and the whole suffers. Decentralization, whether political, economic, or digital is just qi in motion, moving where it needs to, replenishing where there is lack.
The modern state and its corporate allies demand obedience to their “center.” The Tao invites us to dissolve the center entirely. We’re talking about resilience versus chaos. In a decentralized society, power and decision-making are too widely spread to be captured by one ego, one ideology, or one failure point.
Living the Decentralized Life
For me, decentralization isn’t just about blockchain or finance. It’s about how I choose to live. I trade in permissionless ideas. I seek communities that can thrive without a single leader. I design my work so it can nomadically move anywhere, like water finding its path.
The Taoist way is not to overthrow the center but to make it irrelevant. In blockchain terms, that’s the 51% majority of life’s nodes agreeing to live outside the control of the central ledger. In Rand’s terms, that’s walking away from the system and building something better in the mountains.
Seven Taoist Rules for a Decentralized Life
☯️ Live Without a Single Point of Failure – Don’t centralize your income, your skills, or your freedom in one place. A true Taoist life is like a distributed network. In other words, if one node falls, the flow continues.
☯️ Practice Wu Wei in Technology and Life – Wu wei or “effortless action” is designing systems (and habits) that work with minimal friction. It’s the opportunity to use tools, tech, and relationships that flow naturally without constant intervention.
☯️ Guard Your Sovereignty Like Qi – In Taoist medicine, qi is your life force—precious and finite. In a decentralized world, your sovereignty is your qi. Don’t let governments, corporations, or single platforms hoard it.
☯️ Walk Away When the Center Corrupts – The I Ching teaches that stagnation comes when the center holds too tightly. Whether it’s a job, a government, or a tech platform—step away before it collapses on you.
☯️ Build in Redundancy Like Nature Does – Nature doesn’t rely on one river to water the land—it creates streams, springs, rainfall. Decentralize your assets, your income streams, your knowledge.
☯️ Lead Without Being Seen – Lao Tzu wrote, “When the best leader’s work is done, the people say, ‘We did it All ourselves.’” In decentralized communities, leadership is subtle, facilitative, and non-controlling.
☯️ Become a Node, Not a Master – In blockchain, every node is both autonomous and connected. Live that way—independent enough to stand alone, yet connected enough to contribute to the whole.
Closing the Circle
The Tao Te Ching reminds us, “The more prohibitions there are, the poorer the people become. The more rules, the more thieves and robbers there will be.”
The decentralized world—technological, societal, personal, isn’t perfect, but it’s closer to the way of the river than the way of the dam.
I’ve lived at this intersection of Taoist philosophy and decentralized reality long enough to know: the future will not be dictated from a single center. It will emerge, node by node, like bamboo shoots after rain—uncoordinated, ungoverned, unstoppable.
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Stay unpredictable,
Diamond Michael Scott — The Chocolate Taoist
Little known? To the general public?