Bitcoin is US Empire | Crypto 3

Today’s video is kind of a case study in the importance of striking while the iron is hot. I was very, very excited to make this video a month and a half ago. An outline, and copious notes came to mind almost instantly. But instead of finishing off the script, I focused on the other two videos in the series, confident that this would be a big blow-out finale. Early next week when I finally sat down to write this script, I was a bit non-plussed. The ideas and the outline still made sense to me, but the vigor and rigor of the ideas have gone flabby. I don’t know. The video still makes some worthwhile points. But I’m not particularly happy with the final execution. I am, however, happy to have finally said my piece on cryptocurrency. Should be able to avoid this topic until the next run up in price a couple years from now.

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Video Transcript after the jump…

Hey there, over the past two videos I have talked about the ways that Cryptocurrency could endanger the US way of life, and limit American political options. But today, I want to talk about what I believe to be the most likely result. As I said in parts one and two, Bitcoin is more dangerous than China, it is Ronald Reagan’s revenge. But most importantly, I believe Bitcoin is US Empire.

In the last two videos I talked about how Crypto is getting into bed with Wall Street despite advertising itself as being revolutionary and disruptive. Today I want to talk about how Crypto is likely to go even further and betray its libertarian promise, by getting into bed with the US government, focusing its disruptive power against every other government in the world, not the most powerful one. Oh, before we go any further, I want to clarify something that has come up a lot in the comments. In the titles to these videos, and for a lot of the visuals, I have been focusing on Bitcoin. That’s an Search engine optimization strategy to maximize video discovery, it’s not a vote for Bitcoin as the most likely winner among the many competing cryptocurrencies.

Maybe Bitcoin is such a genius creation that it will outlive humanity itself, and still be used by our descendants as they colonize the planets of Proxima Centauri. Or maybe it’s Myspace, a clunky mess that demonstrated the value of a new technology but has already been superseded by new currencies in every way and whose value is only being propped up by naive bag holders who don’t know anything about anything. Honestly I don’t really care. In this video, and this series, I have been talking about Crypto in the broader sense, and I have been thinking big picture, in terms of decades, not quarters. I don’t know enough about the individual platforms and their uses to talk seriously about which currencies might win for which purposes. When I say or visually refer to Bitcoin, I am almost always using it as a short hand for cryptocurrencies in the aggregate.

Alright back to the main topic of today’s video. The fact that I believe cryptocurrencies will end up being a tool of US empire. We are doing some speculative sci Fi type stuff today, but hey Crypto is some speculative sci fi type stuff.

Cryptoxurrencies are often advertised as being anti US government, which is nonsense. To counter the US you need strong national governments elsewhere who are able to stick up for themselves. I don’t want that in a military sense, which would be horrible for humanity, but in an economic and political sense. If the human race is going to hold on to any diversity and basic freedom over the next few centuries it needs other governments that can negotiate with the US with something approaching equality. And what I am pretty sure Crypto is going to end up doing is further undermining every government in the world, except for the United States.

Crypto is a fundamentally disruptive technology. But to grow in any meaningfully exponentiall way, and to provide the riches that most of its current holders are looking for, it needs government. There is a really fundamental misunderstanding in a lot of crypto commentary. The mere existence of this technology is not some universal solvent. The lack of regulatory action by the US government to date isn’t because the US government is intimidated. It’s because the US government simply hasn’t bothered to pay attention.

The whole sector of decentralized finance is a great example here. It’s either going to get heavily regulated by the US government, or it’s going to disappear. Decentralized exchanges that attempt to continue to operate without US oversight have the same future as the silk road marketplace, an earlier attempt to use cryptocurrency to get around the law that is long dead.

I think a lot of people assume that if there is a US crackdown, exchanges can move overseas and conduct business as usual. They can’t. That is not the way the world works on the internet and it’s certainly not the way things have worked since 9/11. The entire planet is firmly ensnared in a web of US power. Maybe it’s true that some of this technology is invulnerable to the US government? But at some point, you are going to want to use a bank somewhere on this planet, for something. With FATCA the US has already stepped into the banking regulations of every country in the world and the compliance requirements of every single bank that attempts to do international business. And, every ransomware attack builds the case for expanding that US penetration. People barely even question it any more when US courts assert jurisdiction over things that happen outside of our borders. It may seem crazy to suggest that Individuals who have nothing to do with the US government, doing transactions that have no connection to the US could be blocked by the US government, but it’s not science fiction. It’s already happening. Just take a look at what we are doing to Iran and Syria. We aren’t just blocking those countries from US business, we are actively prosecuting anybody in the world from any country who attempts to do business with the countries we don’t like.

I suppose, that even with the US’s ever growing power, it’s possible to imagine heroic libertarian dissidents finding the niches necessary to run a cryptocurrency network in opposition to Washington DC. But that’s where the carrot comes in. Most people are in crypto today to get rich. Pretty much every politically committed tech savvy nerd in the world is already in, or already over cryptocurrency. To keep the party going, to keep prices rising, you need scale. And that’s what the US government offers.

This is a process that’s already happening, but once Crypto submits itself more fully to the US government, literally trillions of dollars of investment capital will become available.
I am now, almost involuntarily a very small scale investor in cryptocurrency. FOMO finally got me. But I would not have made that investment if it weren’t for a boring, quasi-safe government regulated exchange.

Most US finance regulation is already written by Wall Street. As long as some basic investor protections and the ability to tax are preserved, the US is probably going to provide a lighter and more responsive regulatory touch than any other government. Crypto players will have a simple choice. Go be a silk road dissident, or go with the US government and get rich.

So yeah the whole cryptocurrency future of border smashing, banking disrupting, and new class enriching is very, very possible. It’s just going to be in service to the US government. Crypto will only need one regulator. I think it’s main function will be to make it even easier to funnel the rest of the world’s wealth into the United States.

El Salvador made the news in a big way a month or so back as the first country to adopt Bitcoin as a national currency. To me it looks like they signed up to be the first loser. In the form of Bitcoin beach and probably a few other projects, El Salvador is benefitting from the charity of a few Bitcoin millionaires who want to make supporting the currency look like a good idea. I think that’s likely to be the extent of the country’s winnings. Not that that desperately poor country has much to lose. You see, it already gave up all power over it’s own currency. It has used the US dollar since 2001. So it may not be giving up all that much in return for the free press of being the first Bitcoin mover. It’s not like El Salvador can get any further under the US’s thumb. Most other countries have a lot more to lose.

Cryptoccurrency is already being sold as a weapon to be used against oppressive dictatorships like Venezuela and North Korea. The ease of transfer of Bitcoin, and the privacy offered by other coins should make it easier to get money in and out of those countries in defiance of their nasty governments. But these technologies don’t read the Freedom House reports. They are just as likely to be used to undermine the French or South Korean governments as they are any rogue government. In fact, there is a lot more wealth to be transferred out of our rich allies than there is in North Korea.

Crypto will be just another way to suck wealth and power out of everybody else. It will happen on autopilot. Not all at once, of course. Slowly, over decades, maybe centuries. And, as I talked about in the last video, the power that Crypto takes away from the world’s governments will ensure that they remain mired in the failed Reaganite orthodoxy that we are all dealing with today.

Do you think all that sounds far fetched? Well we already have highly placed Federal Reserve officials talking about how the US might not need to bother with a Central Bank Digital currency because Crypto is already handling it for us. This isn’t some dystopian far future I am talking about. It’s something that’s already happening.

This final video in my Crypto series may seem to conflict with the first. In the first vid I said Crypto is a vastly bigger threat to the United States than China is, and that it seriously threatens the American way of life. But in this video I said that crypto will be a powerful tool of US Empire. Don’t those two arguments conflict? Not really. You see, just because a tool or ideology helps the rich and powerful, doesn’t mean its good for the vast majority of an empire’s citizens.

I started this series comparing cryptocurrency to Islam, but I think Christianity might be the better comparison. The first Christian Roman Emperor came to power in the year 306. The new religion was initially a great thing for the Empire, helping the elite consolidate the empire. Arguably Christianity was the glue that helped Roman elites hold on to power for 1100 years after that. It’s unlikely, what with all the purges and pillaged cities, but it’s just possible that the descendant of a wealthy Roman in the year 300 could still be rich and prestigious in the year 1453, when the Turks crushed Rome’s last outpost. Christianity worked out great for the guys on top. But how about the millions of other non-rich people in the Roman empire in the year 300? Well their standard of living, and in many cases their living at all collapsed in the first couple hundred years of official Roman Christianity. What’s good for the leaders of an empire is often not so great for that empire’s people. Cryptocurrency could be great for the people who run US empire. And not so great for the rest of us on this planet.