Here’s what we’re reading and working on this week at Epsilon Theory.
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The Eye of Sauron – by which I mean the panopticon gaze of the US Treasury Department – continues to expand its purview over crypto.
Prior Treasury-proposed crypto surveillance was focused on “money transmitters” – banks and exchanges and brokers … any business where money IS their business. These new proposals take those same reporting requirements and extend them to US corporate entities that use money IN their business. As in, ALL corporate entities.
Everything I wrote about in In Praise of Bitcoin is happening. Just faster than I thought it would.
But there’s one thing that gives me hope.
In the past two days, both Paul Krugman and two stalwarts of the Wall Street Journal – Greg Ip and James Mackintosh – penned what I’m sure they thought was their mighty takedown of Bitcoin.
To Krugman it’s just a “silly idea”. Greg Ip writes that Bitcoin will go down in history on the short list of truly awful and society-damaging innovations … you know, like “asbestos, cigarettes and fentanyl”. To Mackintosh, Bitcoin’s usefulness – other than being “a gamblers’ paradise” – is limited to “little more than hackers’ blackmail payments and drug dealing”.
Whenever Paul Krugman and the Wall Street Journal agree on something … I want to be on the other side of that trade.
Why? Because they embody the Grumpy Grandpa establishment view that an insurgent narrative – which is at the heart of crypto’s appeal – requires as a foil. More than half the battle in constructing a winning narrative protagonist (this is true in politics as much as it is in markets) is choosing your narrative antagonist. And my god, if you gave me my choice of narrative enemies, there’s no one I’d rather have than Paul Krugman and the Wall Street Journal!
This has been a bad week for Bitcoin and Bitcoin! TM alike. There’s no getting around that.
But the consolation for Bitcoin! TM is that these are op-ed hit pieces that are only written after crypto prices fall a lot. Could they fall farther? Sure! But you never see articles like this at a top.
And the consolation for Bitcoin? Well, if opposition to a unified front of Paul Krugman and the Wall Street Journal can’t reenergize the OG Bitcoin narrative of insurgency and resistance to the Nudging State and Nudging Oligarchy, then I don’t know what can!