Despite its apolitical nature, Bitcoin needs our democracy to thrive just as much as our democracy needs Bitcoin to improve.
This is an opinion piece by Frank Kashner, founder of UnChainDemocracy.org.
The “politics” is often defined as “the activities associated with the governance of a country or other region, in particular the debate or conflict between individuals or parties having or hoping to achieve power”.
Do we want Bitcoin to rise to power? Yes, although power for Bitcoin is different from power for a person or an economic or political entity. But we’re still talking about power, as expressed through code design and implementation, (electrical) proof of work, the internet, exchanges, editorials, blogs, laws, courts , schools and politicians. The block war, which I experienced, was ultimately a political power struggle, won by proponents of node decentralization. This article and this magazine are themselves political players in the struggle for future monetary and political power.
Ultimately, monetary freedom, bitcoin, is only one aspect of freedom. For those who live in the United States, another aspect of freedom is our political rights as set forth in the Bill of Rights and the Constitution. As such, even our woefully flawed democracy deserves to be defended and expanded.
But it seems that many Bitcoiners don’t see it that way. For example, Jimmy Song, whom I respect and learned a lot from, felt that, perhaps, our democracy is so flawed that it deserves to be abandoned. But I suggest that bitcoin and democracy need each other and that the alternative, autocracy, would be horrible.
Bitcoin, still caught in the currents of political power
A friend recently pointed out that our current political divide can be seen as a divide between those who focus on freedom and those who focus on equality. Like two dots on a line, we in the Bitcoin community can find unity around similar visions of what Bitcoin makes possible in a democracy. But we also need to look at the relationship between Bitcoin and democracy and imagine the grim alternative: to live in an autocracy capable of seizing our assets and violating our other rights.
In 1941, a time of great political conflict, in his book “Talking Columbia”, Woody Guthrie famous sang“I don’t like dictators, not much, but I think the whole country should be run… By electricity!”
Electrification, a revolutionary technology then (much like Bitcoin today in some ways), was a technology opposed and supported by various business interests and their hired politicians. Even today, a quick search reveals major opposition to electrification efforts.
Like electricity, Bitcoin is now and forever will be caught up in the currents of financial and political power. This is the very nature of a scale change in Bitcoin. Consider what we’ve already seen: China bans Bitcoin, Canadian truckers use BTC, El Salvador defies the IMF and makes bitcoin legal tender, BTC emerges in Ukraine, the US Securities and Exchange Commission (SEC) United refuses the request to convert GBTC into an ETFNigerians are starting to use Bitcoin, and currently, “Operation Choke Point” as SEC blocks access to banks for bitcoin companies.
These currents explain the presence of political freedom, a functioning democracy, as well as the legal status of Bitcoin. For more evidence of Bitcoin’s intrinsic ties to democracy, check out The Human Rights Foundation, which has an arm led by Alex Gladstein that uses Bitcoin to enhance political and economic freedomespecially in some of the world’s worst autocracies.
Bitcoin is more fragile than we think
A list of fundamental properties of Bitcoin includes decentralization, antifragility, protection against confiscation, an incorruptible development system, proof-of-work security, and protection against nodes defending it. Yet I think we are naïve about its strength.
It is easy for us who live in Western democracies to assume that the rule of law, which protects our property and our freedom, is a given. If we lived in China, North Korea, Afghanistan, Turkey or Russia, we might not be so optimistic.
While Bitcoin makes an attractive Trojan horse (the numbers are growing, sort of) for some of the wealthy and powerful, competing interests could create legislation and policy that could kick Bitcoin out of the monetary gates of empire. Yes, we could still operate “underground,” but think about what that would look like.
Today Bitcoin is tiny, and those in power have subtle ways of delaying and denying its widespread adoption, such as claiming that “mining destroys the environment” or claiming that “a bad actor like Sam Bankman- Fried is a political agent.”
Consider how authoritarian governments that use threats of jail and violence treat Bitcoin. They have no problem with confiscation, even if they seize mining machines (as it happened in Venezuela).
And there are other issues with what we consider Bitcoin’s immutable properties: Why there are so few Core developers, and what are the implications for the future of Bitcoin? Why are there so few nodes (about 16,000) compared to the total number of Bitcoin users? Why do government agencies restrict trade and promote misinformation about the value and use of energy?
It is our democracy that allows bitcoin advocates to advocate, lobby, broadcast, have businesses, and go to court. But our democracy, weak as it is, is increasingly threatened by corporate forces that would prefer unregulation and autocratic rule to themselves. I predict they will defend the US dollar based system. To win, bitcoin and democracy advocates need each other.
Some bitcoin arena broadcasters or their guests claim that it is the managerial and political classes that have all the power. This is simply not true – see, for example, “Who Rules America?” by William Domhoff, “Dark Money” by Jane Mayer, “Democracy in Chains” by Nancy MacLean Or “Shadow Network” by Anne Nelson. These are well-researched looks at how those who would turn the United States into an authoritarian country have significant power and have pushed this agenda forward over the past 50 years.
In conclusion, bitcoin needs democracy and democracy needs bitcoin. Both systems are dynamic and constantly changing, which complicates our task. I hope this perspective will help me and others convince Bitcoin advocates to pay more constructive attention to our political system and help democracy advocates pay more attention to economic freedom. inherent in bitcoin.
This is a guest post by Frank Kashner. The opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.