When the President of People For Liberty, Dr. Jo Jorgensen, was on stage with Andrew Yang and Glenn Greenwald at Bitcoin 2022 in Miami last week, she was asked what she thought about the state of cryptocurrencies. She responded
“When I was on the campaign trail people asked me if I wanted to return to the Gold Standard. I said, that wasn’t far enough. I want free market money!”
The auditorium erupted with loud cheers and applause because Dr. Jorgensen had put her finger on the fundamental issue.
Anyone who has thought about our astonishingly successful economic system, based on free trade and markets has realized the critical element of currency to the system. Currency provides a medium of exchange for goods and services that otherwise would be incredibly awkward. Currency. People For Liberty has published before about the difference between Wealth, Value and Currency, and if that concept is unfamiliar, it’s worth a read to enhance your financial literacy.
All currency is fundamentally only worth what someone will trade for it. Right now while the United States is in the midst of high inflation, caused by extreme government spending, we see government backed currencies having decreased buying power as people are unsure of its value.
Which is where the benefit of alternate currencies comes in. Of course the world has always had alternate currencies – the British Pound and Japanese Yen can be used to buy things of value from people that accept them. And there have always been currency traders who make and lose money by trying to buy currencies whose value is going to rise.
This sort of trading however is awkward to complete and requires specialized knowledge and access to particular markets. With the advent of cryptocurrencies the average consumer now has the opportunity to buy, sell and use alternate currencies to enhance their financial capabilities. Right now using a digital currency I can buy something from someone in Cuba or send them money, and no government will know about it.
Digital exchanging of currency compared to physical exchange of currency is like comparing email with physical mail. The exchange Is lightning fast, is facilitated by a large number of different vendors, and does not require any government involvement. And I can use whatever currency I choose – free market money.
Which of course, the government hates. The government wants to be the only valid currency that you have access to. They want to monitor your currency usage. If I want to give you a gift of 1 bitcoin, you are required to report that gift to the IRS, because its current value is over $16,000. Why? On the other hand, if I were to buy something from you and pay you with 1 bitcoin, the government doesn’t need to know. If you try to exchange that bitcoin for cash, the IRS will be notified by the exchange that gives you the cash.
And here’s where it gets scary. Joe Biden issued an Executive Order in March to increase government regulation on cryptocurrency and had the treasury start looking into the Federal government issuing their own digital currency, and their own digital wallets.
What that means is that the government will be the only entity that can issue you a wallet that will hold the United States Digital Dollar (USDD). And every transaction that moves USDD will be monitored by the Government.
Undocumented workers won’t be able to get a USDD wallet, making it impossible to employ them. You won’t be able to pay a babysitter without the government knowing about it. Want to pick up a side job to earn a little extra cash? Not without the government tracking it.
Of course for the government there are some good things. No more counterfeiting. Ransomware attacks become impossible because you could only pay a ransom into a USDD issued wallet. Best of all for the government, it becomes almost impossible to cheat on your taxes. The government knows about ALL of your income. The way a digital transaction is processed is that it is “approved” by an authority that records the transaction in a giant ledger. For decentralized currencies like Bitcoin, that authority is the miners. For the USDD that authority will be the Treasury Department. No transaction can be completed with them knowing about it and their blessing.
The government wants everything to be a political issue. 200 years ago marriage wasn’t a political issue because there was no income tax, so people could declare themselves married to whomever they wanted. Then the government created marriage regulations and Same Sex marriage became illegal, and it took over 100 years to repeal the government regulations about how you define your family.
200 years ago cannabis was completely legal. Then the government was lobbied by people with a financial incentive to make hemp illegal, and countless lives were lost in a ridiculous war on drugs before state governments stopped arresting people for cannabis possession.
People won those wars of liberty by changing public opinion to make people think that Marriage and Cannabis should not be political issues. Instead activists convinced the nation that those were Liberty issues. We must do the same for Cryptocurrency, hopefully this time before the government regulates it too heavily. Cryptocurrency and the larger idea of free market currencies must be defended. We must make people think that free market currency is a Liberty idea, and not a political one.
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