Bitcoin is not for speculation. Bitcoin is about the transmission and exchange of valuable information attached to a digital currency that measures the value of the information. The volatility we are seeing in the market for Bitcoin is based on the fear of missing out on a pop in value.
I think in the near future what will eventually drive the value of Bitcoin is the underlying value of the information that the individual sovereign either possesses or can produce. It is likely that person A holding Bitcoin may look at person B who allegedly has some information, x, and determine that the person B’s information or ability to generate useful information has no value. Think of someone in London approached by someone from Somalia who wishes to trade in Somalian currency. The Londoner wouldn’t touch it.
You may argue that scenario already occurs in the real world, that trader A is not required to transact with trader B. In a centralized world, trader B would bring a discrimination grievance against trader A for refusing to trade. In a decentralized, voluntaryist cyber world, no matter how much cryptocurrency you hold, the value of your true currency, the information that you possess or can produce, will determine your digital currency’s value.
As for the speculators, the error they make is using valuation methods created in a centralized, coercive political economy to assess the value of a currency designed for a decentralized cyber society. A speculators are enjoying the upside of Bitcoin’s market appreciation, but as the currency becomes more expensive and reaches its 21 million digital currency cap, will these speculators be able to purchase any more of the currency? Or, will they be able to ride out the inflationary characteristic the coin takes on should it become a matter of two few Bitcoin chasing too many goods? Will lower income individuals who may have made their first purchases with their credit cards be able to recover the dollar value of the coin in order to pay off increasing interest rates?
Not to mention the competing currencies that will eventually knock off Bitcoin from its perch. As technology improves such that “information rich” individuals create their own cryptocurrency, individual sovereignty will be complete. Just like western nations trade with each other based primarily on similar values and culture, the information rich will do the same. As the value of their currency increases so to will the demand from vendors who will likely prefer hold in reserve the currency of the information rich versus the “information poor.”
I believe that the information poor or “information losers” who were lucky to get a few pieces of a coin in the early days will not be able to participate on either side of a cyber trade in the future. Their focus should be on building their information gathering tools versus pursuing a quick fix, get rich path.
Cyber space will remain decentralized by the silos created by the information rich will prove daunting for the information poor.
Nyota Uhura is on a quest to digitize herself. She creates digital product on her laptop, transmits her finished product to her clients via the internet, and gets paid primarily in cryptocurrency. Every now and then she accepts fiat currency issued by a nation-state in part because as a mini-sovereign she likes to have a reserve currency for emergency use or in case a hole-in-the-wall restaurant on a south Florida beach doesn’t accept BitCoin.
She probably spends too much time socializing in cyberspace. Facebook and Instagram keep her in touch with her brothers and sisters in Congo or her cousins in Brooklyn. As a busy creative she sends out for food via Uber Eats and uses Uber or Lyft to get around.
She is not naive about the public safety protection that Atlanta markets to its residents. She has a home security service that she communicates with via broadband. She uses her laptop as a surveillance camera courtesy of her broadband access provider. She keeps a shotgun and feels confident in her self-defense skills. If she were a pilot, she would avoid Atlanta’s biggest amenity, Hartsfield-Jackson International Airport and opt for the smaller Charlie Brown airfield.
Why then, she asks, should she even pay taxes?
Her friends rebuttal is that she should contribute to the public services that she uses to get around; that she should pay for use of the streets and use of the police protection. On a national level, she should support Medicare and the national defense, and social security because these programs help provide security for her future.
And she should be ashamed of herself for not showing the ultimate allegiance to her government by avoiding the use of America’s fiat currency. Her failure to use it, they argue, only negatively impacts the nation’s economy by devaluing the dollar through shrunken demand.
Nyota expected the canned rebuttal from her friends and family. She responds, however, with a rebuttal they are not prepared for, one based on value. Being coerced by a false sense of duty and obligation to pay for sub-par protection services makes no sense to her. She hasn’t bought in on the police’s public relations campaign that they are there to protect the public and would like her taxes reduced by whatever the city assesses as her contribution. She has no enemies in Russia, North Korea, Syria, Afghanistan, Iraq, or Iran other than the enemies created by U.S. policy. Since she didn’t create these enemies, she would also like her taxes reduced by the amount of her contribution to these services.
Nyota pays a sales tax when she eats a cheat meal at McDonald’s. She also contributes to the transportation tax when she pays her Uber driver for a lift to the grocery store. She literally works in another jurisdiction, cyberspace, and because of this, Nyota believes she should not have to pay a federal income tax, especially to a government that provides low value protection services.
A strong legal and political argument will have to be crafted and promoted to bring about these changes, but at least Nyota is thinking about exit.
It has been two months now since I got rid of cable. The noise out of Washington has gotten to be a bit much. Americans appear to be ever increasingly losing their minds over the man sitting in the Oval Office. In less than three years his critics in the electorate will have an opportunity to enter a ballot box near them and vote for someone else.
If engagement in the ballot box and with C-SPAN’s Washington Journal were so fruitful we would have less tension or at least fewer reports on Donald Trump. Social media would be quieter or at least focused on something hopefully less mind numbing (I know that’s a lot of hope.)
As the good people at Reason.com reported back in 2012, one’s vote, in the end doesn’t matter. Given that voting is about the most active political engagement most Americans will engage in, voting amounts to a colossal waste of time. Citing work done by the National Bureau of Economic Research, of the one billion votes cast in 40,000 legislative elections between 1898 and 2001, only seven contests were decided by a single vote. There are higher payoffs from just about any other activity than voting.
And what does government provide that we feel so emotionally invested in calling each other names, not speaking to each other, or worse, unfriending people on Facebook? Not much for our tax dollar.
For example, do you like the state of your roads or other infrastructure? The American Society of Civil Engineers gave America’s roads, bridges, and ports a grade of “D+” in a 2017 survey. The score has stayed relatively the same for the last 20 years, and given Congress’ inability to fund budgets, especially the transportation portion, I believe that grade will be on the United States’ report card for awhile.
How about America’s education policies? Are policymakers effectively addressing how well the State educates kids? Well, no. Remember Common Core, the initiative detailing what children grades kindergarten through 12th grade should know at the end of each school year? While enthusiastically supported by a Republican and Democratic president, a report by the Brookings Institution in 2012 determined that the policy would have little to no impact on a student’s ability to learn.
The news isn’t so rosy on the collegiate level either. For all its equating of democracy to equality, Blacks and Latinos are equating democracy to a racial disparity in accessing college education. In a USA Today article citing statistics from the National Center for Education Statistics, it was reported that Blacks and Latinos, while enrolling in college on a relatively similar proportion as whites, were enrolling in for-profit schools and community colleges at a higher rate than whites. This is considered problematic, according to the article, because of complications surrounding financial aid.
These are just some examples of the State’s failure to deliver on the benefits that it promises to its “extended employees”, the constituents who vote for the politicians that promise the good schools, good roads, and bountiful opportunities. One would think that more Americans would disconnect from a government that hasn’t kept its word, but on the contrary, like the population who have endured abusive relationships, there is that small fraction of the population that somehow believe that abuse is love.
So how does one disconnect from the State’s political noise? First remember that you cannot avoid the State. The State influences you via its rules and statutes; its courts; the media; and the taxes it levies. You cannot violate its rules without bringing harm to yourself. Your actions should lead to maintenance and survivability of self and family; top optimize your sovereignty. Your goal is to minimize contact with the State and replace its “services” with services provided via voluntary, private arrangement.
A couple approaches that you may have already thought of. For example, avoid owning property. The State encourages its citizens to own property so that a nexus for taxation exists. Work hard to improve the value of your property and every year there is the State swooping in for its cut.
A mistake I made was having my son educated in State schools. If you can, educate your children at home. This way you can devote more time to inculcating life survival skills and critical thinking skills very early. Schools focus primarily on programming children for allegiance to the State’s values. An independent thinking, self-actualized child is one of the biggest threats to the State. Trust me. It’s not some teen-aged gang banger that the State is afraid of. The gang banger can be shot down and no one will raise a fuss.
Another approach, stop voting. Don’t feel bad about not going to the polls. First of all, you are not required to. As we discussed earlier, your vote doesn’t matter. More importantly, the tyranny of the masses that is democracy is fueled by the vote. Why further threaten your individual sovereignty by giving wanna be master any authority to write oppressive rules.
Finally, divorce yourself from government issued currency and form a trading community that uses a non-government issued currency, hopefully one backed by a natural resource. The Treasury issued, Federal Reserve Bank distributed currency is backed by an economic infrastructure that may be working for some but not for the majority. The currency’s demand should be a reflection of the economy that lies behind it, one that is productive.