By Bitcoin Magazine - 6 months ago - Reading Time: 8 minutes
Bitcoin = Anti-Totalitarianism
In the face of ongoing challenges to our cherished freedoms, it is imperative to critically examine the forces at play that threaten the very fabric of democracy. The ideals of freedom and open markets are at risk of being undermined by influential political forces seeking to impose oppressive order and control in the name of security. This article delves into the pressing need to fix our manipulated markets, protect Bitcoin and its inherent anti-totalitarian qualities, and inform US policymakers that democratic values are what’s at stake.
The Erosion of Free Markets and Capitalism
People who think we currently have capitalism and free and open markets haven’t been paying attention. The American economic landscape, once a paragon of capitalism, has undergone a seismic shift, particularly since the 2008 financial crisis when lawmakers selectively bailed out the bankers at the expense of the broader economy. The central banking system’s pervasive influence has led to a distortion of free markets, with quantitative easing (QE) being employed as a tool to manipulate the bond market, artificially lowering the cost of capital and thus distorting the prices of…everything. This manipulation has had far-reaching consequences, including the gutting of the middle class and the concentration of wealth in the hands of a few.
In the wake of the Silicon Valley Bank failure this March, the deployment of tools such as the Bank Term Funding Program (BTFP) has further exacerbated these distortions, providing de facto yield curve control for banks, while leaving ordinary citizens to grapple with soaring interest rates and inflation. This divergence from naturally occurring economic markets and the suppression of a free and open cost of capital has pushed us closer to an economic model reminiscent of “you name it” communism regime, threatening the foundational principles of capitalism and democracy.
The Newest Assault on Financial Freedom and Bitcoin
In a recent letter from Senator Elizabeth Warren and numerous congressional members, they leverage international crises to further their own political agenda and curtail financial freedoms. Armed with a freshly published Wall Street Journal article that falsely suggests Hamas raised a significant sum of crypto funding to attack Israel - the truth couldn’t be more obscured. The irony of the claim is that the public Bitcoin blockchain provides evidence that anyone can dispute – which is exactly what happened the day following the Senator’s letter to the President. On October 18, blockchain analysis firm, Chainalysis, clarified that while some terrorist organizations, including Hamas, do leverage cryptocurrencies for funding, the scale is extremely small relative to traditional fiat banking means. They emphasized that the transparency of blockchain technology makes it a less suitable medium for illicit activities, including terrorism financing. Additionally, Chainalysis pointed out that government agencies and private sector organizations can collaborate using blockchain analysis solutions to trace and disrupt the flow of funds to these terrorist groups. They also highlighted the importance of understanding the role of service providers in these financial networks and cautioned against overestimating the scale of terrorism financing in cryptocurrency based on flawed analyses and misinterpretations.
Delving deeper into the facts revealed by Chainalysis, it becomes increasingly evident how Senator Warren’s letter dramatically skewed the situation. The detailed analysis zeroes in on a specific address that conducted over 1,300 deposits and 1,200 withdrawals within a mere 7.5 months, with a total inflow of roughly $82 million in cryptocurrency. However, a mere fraction of this amount, approximately $450,000, can be linked back to a wallet associated with terrorist activities (source). This represents a mere 0.3461% of the purported $130 million claimed in the letter—a staggering discrepancy that lays bare the deceptive nature of the narrative being pushed to the White House. Not only has Business Insider reported on October 21 that Hamas operates with an annual budget of $300 million, but a significant portion of its funding also stems from taxing imports into Gaza, as well as international connections with Iran. A country to which the US government recently, and rather ambiguously, may have released $6 billion in fiat currency to in September, just a month prior to the attack on Israel. Unlike Bitcoin, which offers a publicly accessible audit trail, citizens are left in the dark about this substantial financial transaction. The narrative on what was actually released depends heavily on the news outlet or political interest one consults, often resulting in biased and self-serving points of view - the irony. This stark contrast between politically manipulated numbers and the transparent reality a public blockchain provides underscores the urgent need for thorough, factual analysis and the adoption of publicly verifiable monetary units like Bitcoin.
Why Is This So Concerning?
Kneejerk policy reactions, based on false information and poor reporting can have devastating long-term impacts to the US’s competitive economic position and more importantly the liberties and freedoms of the citizens. In what appears to be a coordinated policy response (one day after Senator Warren’s letter), The U.S. Financial Crimes Enforcement Network (FinCEN) came out with a proposal for special measures regarding convertible virtual currency mixing and labeled it a primary money laundering concern. Based on all the information contained in the FinCEN proposal, it opens the door for expansive policy to infringe on the rights of individuals. For example, the increased surveillance and potential loss of privacy could subject individuals running Bitcoin full nodes to unprecedented scrutiny. They might find themselves burdened with regulatory requirements that are not only onerous but also infringe upon their personal privacy, and the privacy of users transacting through their nodes. The uncertainty and legal risks associated with running a full node under these proposed measures could discourage individuals from auditing their property, thus increasing their risk and reliance on bad actors.
Bitcoin holders that ran their own node and took custody of their property in 2022 were NOT impacted by fraudulent centralized gate-keepers, like Sam Bankman Fried, and third party custodians that acted maliciously. Additionally, a policy attack on node operators creates less financial freedom for US citizens and an incentive for businesses in this new sector of finance to move offshore. Developers might be discouraged from creating and implementing privacy-enhancing features, limiting the potential and the very essence of American citizens and builders within this country.
What is the essence of a Bitcoin Node and why is it important?
In the gold market, how would you know if someone gave you a pure bar of gold? Well, you can own an XRF (X-ray Fluorescence) device that emits energy waves into the metal to determine the elemental composition based on the frequency of energy that comes back to the device. In short, a purity audit ensures that you have purchased actual gold. Why is this device so important – because if you buy a million dollars of gold, you want to make sure it’s the real stuff, right? In Bitcoin, that purity test is conducted by running a full node. This test can be outsourced to a third party, or it can be conducted by the individual. This point is vital: if a person is NOT allowed to run their own node and audit delivery, it would be the same as saying a person accepting delivery of a billion dollars in gold is banned from conducting their own personal audit.
Since bitcoin is a digital commodity, this right to audit delivery is essential to protect their liberties against foul play. Suggesting such a device be banned is a vote for autocratic control by government handlers at the expense of the individual’s rights to protect themselves from thieves. While we are on this important subject, Bitcoin is the only blockchain that has a code base small enough to allow for everyday citizens to afford and operate their own node and provide independent audits on their property – ensuring its legitimacy and overall security. In short, Bitcoin is different – Bitcoin promotes individual freedoms, sovereignty, and liberties at the individual level. An idea consistent with our Declaration of Independence: “Endowed by their Creator with certain unalienable Rights…That to secure these rights, Governments are instituted among men, deriving their just powers from the consent of the governed.”
A Call to Action
So what do totalitarian governments embrace? They embrace control. Such a control is often established through small and incremental changes that mask a deeper trend and direction that citizens don’t notice. This progression ultimately leads to absolute control. Now, what is the paramount lever to pull if a government was interested in absolute control? That’s right, the money. Because money is the energy that fuels every action and desire of the individual citizen. Therefore let me be very clear: You will not beat a totalitarian government by becoming more totalitarian.
America was founded on the principle of individual rights and freedoms. Those freedoms in turn created the strongest economy and most powerful nation on the planet. It is those very freedoms that are at risk with knee jerk policy decisions to remove your individual rights in the name of security.
In the face of the unstoppable tide that is Bitcoin and decentralized finance, it is paramount that we, as a society, and particularly as citizens of the United States, recognize the critical crossroads we find ourselves. The trajectory of Bitcoin’s innovation and adoption will continue, with or without the active participation or understanding of any single nation. The question that remains is whether we will be leaders or laggards in this inevitable financial evolution.
Our cherished ideals of liberty and open markets are at stake. We must urgently commit ourselves to a deep and nuanced understanding of Bitcoin’s potential to secure financial freedom in an increasingly digital future. By actively choosing to educate ourselves, our communities, and engaging in meaningful dialogue with our elected representatives, we are taking essential steps towards protecting our position as a global financial leader.
This is not just about maintaining economic dominance; it is about safeguarding the very liberties and freedoms that define us. The false sense of security provided by manipulated markets and snap policy decisions has eroded the foundation of capitalism—a system that, in its true form, no longer exists. We must recognize this distortion, challenge it, and champion the cause of financial freedom through Bitcoin.
Supporting organizations dedicated to digital rights and financial freedom becomes not just a choice, but a duty. By contributing our time, resources, and voices, we are making a stand against the forces that seek to centralize control and diminish our economic sovereignty.
On an individual level, embracing the tools that ensure our financial freedom—such as setting up Bitcoin wallets, running full nodes, and educating ourselves on the secure use of Bitcoin—is a powerful act of promoting freedom. We are fortifying the network, protecting our assets, and affirming our commitment to a future where financial freedom is accessible to all.
The challenge is formidable, but the stakes are too high to remain passive. The United States has a choice: adapt and embrace the decentralized future of money, securing our liberties and financial leadership, or risk being left behind, tethered to outdated systems and eroding freedoms. The power of informed, engaged, and proactive citizens is our greatest asset in this pivotal moment. Together, we can shape a future that upholds the principles of freedom, innovation, and financial sovereignty.
“Those who would give up essential liberty, to purchase a little temporary safety, deserve neither liberty nor safety” - Benjamin Franklin
Original source: Bitcoin Magazine