Financial Accounting is all about value. Values associated with a property. Real and conceptual property. The value of a real thing is an abstraction of the thing itself separating its conceptual attributes from its physical attributes. The cornerstone of the Information Age is to manage the conceptual properties of a thing independent (by design) from its physical representation. Nothing really new. Natural Language always did that. We now have super powerful artificial languages and systems in which they operate that move us into conceptual virtual worlds. Worlds where first generation abstractions from real things are input to 2nd generation abstractions of the 1st generation abstraction and so on through higher levels of structural abstractions.
Thing get so abstracted that we long for the connection to reality. That is why we take a walk in the woods.
If: Levels of abstractions are connected back to the first level and that level connected to something real, like a definitional truth "I think therefore I am" is a foundation of conscienceless or the physical representation reality of a thing in time and space.
Then: There is meaning. A reference for confidence in perception. Something to hold onto. Something trusted.
Value of a pure concept grows the more it is trusted. If attached to a physical object the value of the attached object grows in relationship if inseparable from its conceptual association.
From this link:
vector accounting (or property accounting) provides a valuation-free description of the property transactions underlying the value transactions of ordinary accounting, thus avoiding their valuation controversies. According to Ellerman, it is called property accounting because it keeps accounts directly in terms of the stocks and flows of the underlying property rights. It attempts to stake out the objective territory that involves no valuation in order to delineate the real issues of valuation. Property is understood to change by: transactions between parties and appropriations ("or, metaphorically, with Nature"). He states:
...vector accounting shows that an accounting equation can still be used in the presence of incomparability between dimensions by using vector equations. This is a mathematical fact independent of the content. the content of the vector accounting formalism could be property accounting, social accounting, accounting for physical inventories at different locations, and so forth.
Property rights are a conceptual abstraction built on or asscociated with a conceptual abstraction of their variable value. Property rights are conveyed in trade. Each trade is a new time based transfer of property right and if recorded makes a chain of historical property holders.
Sound like Bitcoin?
If so you get the idea. Bitcoin in but a specialized application of the idea of separating "property" accounting from value accounting. If fact it is a superior way of accounting! It applies the same model of evolutionary progress that we as humans have always used as our finest ability: Abstracting conceptual identity attributes from a physical object and managing the conceptual attributes independent of constraints imposed by the physical object. We do not have to hold a rock to convey the meaning of a rock.
Block chain triple entry bookeeping for every thing in the world that has some property right associated with it. Public property or private property. Social concept or real thing.
Stakeholder is a social concept that hs both public and private aspects. The real conflict we have in the world is failure to structurally organize our public and private stakeholding property rights and the values of those rights. Separate the two conceptually and they get easier to understand and manage.
Bitcoin is a test of that extremely universal idea?
We do not have to manage most things in common terms of their related common denomination in money value anymore. We can manage things directly as things. We can equally extract money itself from its tight conceptual binding its value and manage it directly as an conceptual object independent of its value.
Money in the Bitcoin world is the transaction. A two party transaction conveying property right. There is no higher level abstraction necessary to divide money into a double entry debt relationship. Bitcoin is not a debt money representation.
Some say that money by definition is a representation of debt involving a counterparty. Bitcoin therefore is not money it is an asset. Absolutely. An absolute expression of pure absolute property right independent of value. In that separation the pure value stands alone as expectation that the property right will be accepted by someone in trade for something. The fact that it must be accepted or it is the only medium of acceptance in payment for something might have been true in the history of money but no longer the fundamental basis or reason for existence for what money is.
The third dimension making a triple entry system out of a double entry accounting system beyond current property right ownership and value is connecting the holding of a property right back to the underlaying object and the sharing of that property right with other stakeholders in non-money value terms.
Perhaps that is a 4th dimension. There are currently by popular understanding 10 dimensions of the universe. We have some ways to go in the dimensional evolution of our conceptual and increasingly virtual world.
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