In Praise of Bitcoin

Time for a good, old-fashioned hard fork.

https://www.reuters.com/world/us/biden-push-trillions-investment-plead-police-reform-congress-speech-2021-04-28/

4 Trillion - not being political I know Ben said 2 Trillion no matter who won the 2020 election.

Actually it will be 6 counting the 2 we just spent. The spirit of Bens prediction rings more true than ever --The Long Now --indeed.

If a subscriber pays for the ET subscription with BTC through your BTCPay Server, won’t you have to report it to Sauron?

Ben, Granted this article is focused on Bitcoin (sorry, Bitcoin!), but isn’t it fair to say that the developments in DeFi and protocols focused on self-sovereign data (Web 3.0) are: 1. real world use cases with real cash flows, that offer a quantum improvement in the product (financial services) offered to its users, and 2. are built on the foundation of Bitcoin’s idea of - if not taking power away from the state, then at least reclaiming some power from and offering an alternative to oligopolistic rent-seeking middlemen?

Even assuming that KYC/AML will be enforced on all DeFi protocols (and I agree that this is inevitable), they will still offer a fundamentally better financial system to users as they redirect the rents collected by the middlemen to users of the system. So borrowers and lenders, for example, can BOTH get better financial terms in a DeFi protocol than they can in the traditional financial system. And this will be very hard for Wall St to completely co-opt and corrupt, because the ‘pure’ DeFi systems that cut out the middlemen will provide inherently better financial returns, due to the lack of the rent seekers in the middle. Let Wall St trade the tokens that power DeFi, that does not inherently corrupt what it does, or what it is about. And while the oligopolistic banks and others directly targeted by DeFi will try to fight it, Sauron will be happy as long as KYC/AML is enforced and taxes are paid.

Sure, a KYC/AML’d DeFi system is not the purist revolution that many Bitcoin proponents dreamed of, but it is a hell of a lot better than what we have now, and the excessive focus on Bitcoin by people like Mr Krugman has blinded them to the real benefits offered by DeFi. And lets be clear, none of these DeFi developments would have happened unless Bitcoin (or even Bitcoin!) had paved the way first. So give it some credit for that.

Ben,

I suspect you are familiar with the below book by Juan Zarate, a recent architect of modernizing the FinCEN complex at Treasury and State. While my read of it was with great interest being more than familiar with aspects of AML, RICO, KYC, etc - my overall impression was one of confirming my fear the US Govt was overusing it’s power of being the world’s reserve currency and Wall Street being the center of the financial world. That fear being that we would drive not only enemies but allies to move asway form $US and Wall Street and doing so reduce our ultimate power, soft and hard - that of MONEY.

Your latest piece on Bitcoin hits on all of this. My question for you is not weather Treasury and Wall Street are securitizing Bitcoin for the purposes to be able to “see it”, it is clear as you so elegantly point out. But rather, is there a better alternative available to the policy makers and the money traders?

Our/your "anti-psyop campaign is necessary and compatible with above, I believe.

Treasury’s War: The Unleashing of a New Era of Financial Warfareby Juan Zarate

For more than a decade, America has been waging a new kind of war against the financial networks of rogue regimes, proliferators, terrorist groups, and criminal syndicates. Juan Zarate, a chief architect of modern financial warfare and a former senior Treasury and White House official, pulls back the curtain on this shadowy world. In this gripping story, he explains in unprecedented detail how a small, dedicated group of officials redefined the Treasury’s role and used its unique powers, relationships, and reputation to apply financial pressure against America’s enemies.

I remember being so stoked about blockchain, BTC and ETH when I first read about them and really learned what was behind crypto… and then it slowly dawned on me that it couldn’t escape the regulators forever. After the Mt Gox crash, I figured they’d sweep in and put in massive regulation and possibly even prohibitions. Failure of imagination. Art is abstraction and these proposed rules will morph and morph again as the water drains out. The more interesting and, I think unpredictable, changes will come as we get issuance of CBDC, central bank digital currencies. Serious disintermediation will happen then but the racoons will be all over it. Jamie Dimon heading up the USPS? Talk about the eye of Sauron!

Nope. We’re not a money transmitter as defined by UST.

Totally get the distinction you are making between “(original) Bitcoin” and “Bitcoin™”. Totally sympathetic to your antipathy to “the State and the status quo institutionalization of capital” and the general point that governmental programs tend to expand well beyond their original justification. But I don’t think you’ve explained why you think (original) Bitcoin is “an authentic expression of identity” requires a ferocious defense and that every attempt to monitor or constrain Bitcoin needs to be ferociously opposed.

You haven’t explained why Bitcoin enthusiasm is different from many other expressions of identity that sometimes rub people the wrong way and are sometimes weaponized against non-group members. How are your Bitcoin enthusiasts different from people who use MAGA, Antifa, extreme Second Amendment rights, extreme abortion rights, or the Yale Alumni Society as expressions of identity? How is the enthusiasm for identity politics here consistent with your concern about the widening gyre of public discussion and the huge decline in open hearts and open minds?

Your piece fails to explain why those of us opposed to the Nudging State and the Nudging Oligarchy need to not just allow Bitcoin enthusiasts some space but need to become dedicated supporters. But your piece uses the same propaganda-based emotional good-versus-evil/everyone needs to take sides framing that dominates most manufactured political, corporate and ideological narrative that Epsilon Theory has attacked in the past, and (as you’ve pointed out) is used to promote things like “Bitcoin™”.

You’ve argued that all of the nominal reasons for existing financial reporting requirements (money laundering, fighting terrorism etc) are complete BS, and that the only purpose these laws ever served was to Take Away All Our Freedoms. Yes these laws have serious problems, but you’ve ignored substantial evidence that Bitcoin has clearly facilitated things like drugs and arms trafficking  and industrial scale tax evasion. You’ve failed to provide evidence supporting your claim that the immediate gains eliminating them would massively outweigh the costs and risks.

I happen to agree that the loss of privacy and autonomy driven by surveillance capitalism is a very important issue, but if fighting Bitcoin-related financial reporting requirements is now a requirement for pack membership, why aren’t the many other problems caused by surveillance capitalism given similar emphasis? Why haven’t you posted lots of major articles on Epsilon Theory attacking both the Silicon Valley (Google, Facebook) and military-industrial-homeland security assaults on privacy and autonomy?

Thank you, Ben. Your article was “brave”. Lol. Seriously. It’s brave to try to make the “grey” case for Bitcoin, in between the ferocity that is team black & team white. And even braver to heap praise on it that has absolutely nothing to do with its most alluring facet… it’s price!

To think of it as art - for me, anyway - allows all the frustrating ambiguity & debate around its “price” to melt away. It’s worth what folks will pay. Same as any other art. Simple.

I’ve thoroughly enjoyed the show that is Bitcoin thus far; observing it’s affect on the masses. It constantly has me thinking of delusions & crowds & madness & something or other…

I digress.

Is it a million yet?

These are thing that bothered me as well, to the extent that I kept looking for rationales that never showed up. I’m sure there’s something here that Ben is trying to get us to understand, but I simply don’t see it. The expanding intrusion of gov’t into the untouchable realm of Bitcoin was predictable from day 1; small efforts like Ben’s to stay separate from that but still utillize Bitcoin are futile, I believe. More is needed - more thought, more explanation, more comparisons — we’ve only just begun … to learn.
But Bitcoin as Identity is a huge stretch. Gotta let that one settle in.