Bitcoin — Not As Advertised

Sometimes it seems like everything is the exact opposite of what it claims to be.

Take capitalism. It claims to be a decentralized Invisible Hand of free competition — ensuring that all economic abuses are reined in by the discipline of competition so that nobody is able to exploit anyone else. In practice, it is exactly the opposite. Laws are enacted in the name of that Invisible Hand — laws that allow competitive predators the freedom to siphon off all the scattered capital into enormous blocks of unchecked power and control — an Invisible Hand of another kind altogether.

Then the bloated predators of big-time finance point to the struggling small competitors chasing crumbs under the table and say — “See, competitive capitalism really works!” The sacred creed of mainstream Economics is rooted in false advertising.

Then along comes Bitcoin with its bewildering proliferation of clones and power plays — the opposite of what it claims to be — on steroids.

So then, what does Bitcoin claim to be? Well, since Adam Smith’s Invisible Hand has failed in the banking sector too — replacing it with corporate and government monsters lording it over all the rest of us scrambling for the crumbs — then maybe there needs to be a little actual free competition in finance. But if big finance is the problem, how do we break their grip?

Enter Blockchain. Banks used to be necessary as gatekeepers of capital — to keep track of investments, and make sure our savings are directed to people who keep their promises.

No longer. Some computer wizards have developed a scheme where everyone has to keep their promises — because absolutely all transactions are public in cyberspace for anyone to check — but nobody knows who’s keeping them. The scheme is called Blockchain, and it produces something called Cryptocurrency because all identities are securely encrypted.

Don’t need no banks to ensure you won’t be cheated. There’s a new Invisible Hand in town. And the sacred cow of capitalism — privacy — remains intact. Genius solution, this blockchain thing.

But it gets weird quickly. It’s so freakishly decentralized that anyone and his dog can create their very own cryptocurrency — and trade in it with whoever’s equally crazy. And believe me, this fantasy world is expanding like nobody’s business — destined to go nowhere fast.

But then Adam Smith’s Invisible Hand grew exponentially in the same way, back when free trade in commodities seemed to be a viable option. That lasted until unscrupulous operators discovered that, if you get big enough, you can suck the life blood out of the little guys and hog all the big capital — especially if you invest in politics and get the laws changed in your favour. Then you can form gigantic public-private partnerships to siphon off the rest — and shove opponents to the sidelines.

Who thinks free trade in currencies will go in any different direction?

Already — and it’s still so young — large controlling pools of cryptocurrency are forming in the blink of an eye. You’ve barely heard of it, and it’s already coalesced into a monster. The biggest corporations in the world are suddenly jumping in for a piece of the action. If you can’t beat ‘em, join ‘em. You don’t know much about it because the haze of public media is keeping you entertained with Trump and all the other idiots.

The purists are going to lose. The purist blockchainers will hold out for a truly decentralized system of truly anonymous and democratic transactions. The new big players will have none of that. They’re jumping into the game to take it over.

Clean cryptocurrency would theoretically be spread out among millions of small players, so that nobody can control its flows or its prices — just like the fantasy of perfect competition in commodities — and just as unlikely to stay that way. Corporate and government cryptocurrencies can be siphoned off into huge concentrations of dirty money — giving cover for monopoly practices, drug running, money laundering, child porn and worse.

Clean cryptocurrency would keep everybody’s identity securely encrypted (for better or worse). Corporate and government cryptocurrencies will have secret back doors enabling them to spy on everything you do from dawn to whenever. That way corporations can target advertising and governments can target dissidents (with China leading the way).

Clean cryptocurrency will be shoved aside as the big boys muscle in. But this new kind of criminal conspiracy will of course be advertised as squeaky clean. Nothing keeps the people complacent like false advertising puffed up into a romantic myth of freedom.

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One thought on “Bitcoin — Not As Advertised

  1. Mackenzie King once said, “Once a nation parts with the control of its currency and credit, it matters not who makes that nations laws. Usury, once in control, will wreck any nation.” Cryptocurrencies, it seems to me, are a logical development in the rise of transnational capital (and multi-nationals as big power brokers) and the increase of the security state.

    So, do you see blockchain as one more, inevitable? step towards corporatism?

    .

    Like

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