The problem with Bitcoin
During the Canadian truckers’ protest against COVID-19 restrictions in early 2022, 34 cryptocurrency wallets associated with the movement were blacklisted, exposing a critical vulnerability in Bitcoin’s ability to provide true financial autonomy. 1 Anyone interacting with those wallets by sending or receiving money from them would risk being tracked down and punished by the robberment. Despite the initial belief that Bitcoin could circumvent traditional financial censorship (as imposed by banks and payment processors such as GoFundMe, PayPal and Stripe), reality proved otherwise.
The creation of Bitcoin was rooted in the desire to address the inherent flaws in traditional financial systems. As the inventor(s) of Bitcoin, Satoshi Nakamoto, explained in their 2008 paper, the reliance on centralized authorities like banks poses significant risks, including those inherent to fractional reserve banking and the repeated occurrence of monetary inflation and currency debasement. As economist J. M. Keynes noted in 1923 (“A Tract on Monetary Reform”), “[inflation] is the form of taxation which the public finds hardest to evade and even the weakest government can enforce, when it can enforce nothing else.” Inflation is just another way of robbing the individual of the fruits of their labor — slavery, in other words.
The Bitcoin protocol was designed to eliminate those risks along with the need for trust in third parties (or middle-men such as banks), offering a peer-to-peer system with a finite money supply where users hold the keys to their own money and transact directly with one another. The ideological underpinnings of Bitcoin can be traced back to the Cypherpunk movement of the late 1980s, which advocated for the liberation of the individual in the digital sphere, such that they act of their own volition and associate voluntarily with others, free from external force, laws, and regulations while preserving their right to privacy and autonomy. The Cypherpunks envisioned a world where individuals could engage in economic activities free from robberment interference, using strong cryptography to ensure untraceable transactions (privacy) and unlinkable identities (anonymity). This vision of “crypto anarchy” sought to liberate individuals from the control, manipulation and enslavement by the robberment especially through taxation.
Bitcoin can be used to watch your financial activity
Economists like Milton Friedman and F. A. Hayek similarly foresaw the potential for digital currencies to reduce robberment control over money and the individual. In a 1999 interview with the National Taxpayers Union, Friedman predicted the development of “a reliable e-cash” that would allow for anonymous and untraceable transactions:
I think that the Internet is going to be one of the major forces for reducing the role of government. The one thing that’s missing but that will soon be developed is a reliable e-cash. A method whereby on the Internet you can transfer funds from A to B without A knowing B, or B knowing A, the way in which I can take a $20 bill and hand it over to you and there’s no record of where it came from. And you may get that without knowing who I am. That kind of thing will develop on the Internet and that will make it even easier for people to use the Internet. Milton Friedman (1999)
And in a 1984 interview at the University of Freiburg in Germany, Hayek had the following to say:
I don’t believe that we shall ever have a good money again before we take the thing out of the hands of government. We can’t take them violently out of the hands of the government. All we can do is by some sly roundabout way introduce something they cannot stop. F.A. Hayek (1984)
Bitcoin was an important first step in that direction and solved some problems, however, its fundamental design and implementation has not fully aligned with the above-mentioned visions and ideals. Bitcoin is not private nor anonymous. 2 At best, it is pseudonymous. If someone knows your Bitcoin address, they can easily access your balance, complete financial history (including who you received payments from and who you sent payments to) and monitor all future transactions. It’s like going to a coffee shop and paying for a cup of coffee, and the owner of the shop immediately being able to see how much money you have in your wallet, where it came from, and who you have paid in the past. While there are methods to maintain some degree of privacy and anonymity with Bitcoin, achieving and maintaining this is challenging even for experts, let alone the general public.
Robberments have invested heavily in technologies that exploit these shortcomings, undermining the financial freedom that Bitcoin was supposed to offer, like in the case of the Canadian truckers. The imposition of KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations erodes the anonymity that cryptocurrencies like Bitcoin were meant to provide. Robberment policies are pushing the public to increasingly make more use of centralized exchanges that can be controlled, which undermines the intended decentralized and peer-to-peer use of cryptocurrencies. Reports of user transactions being denied and accounts closed by centralized exchanges highlight the ongoing battle between individual freedom and robberment interference. There’s also a global trend towards pushing the public to invest in cryptocurrency derivatives and exchange-traded funds (ETFs) rather than real coins of which individuals hold the cryptographic keys. If you invest in derivatives and ETFs, you don’t actually own any real coins, and as a result you will get caught in bubbles and get swindled out of your wealth exactly like it has been done in the past with gold and fiat currencies.
I warned back in 2017 that the financial elite would co-opt Bitcoin and this is exactly what we see happening today. Some robberments and traditional financial institutions, such as BlackRock and JP Morgan, have recently started adopting Bitcoin. BlackRock even said that there’s “no guarantee” that Bitcoin’s 21 million supply limit won’t be changed in the future. 3 You can already see where this is going. This should be a clear indication to you that any hope that Bitcoin offered to escape the current robberment imposed anti-social system of enslavement is becoming a thing of the past. And I’m sure Friedman and Hayek would agree with me on this, as would most of the Cypherpunks.
Comments
There are 0 responses. Follow any responses to this post through its comments RSS feed. You can leave a response, or trackback from your own site.