Just Say No… To Banning Bitcoin
Happy Hump Day!
The weather is weird in this part of the world. Spring is hotter than summer, so it’s cooling down a bit.
My AC is not going to break down any time soon, thank heavens.
But what’s breaking down is The State’s control of the cash it’s been spewing out since 2008.
Violent Intervention Never Solves Problems
When have any of these ever worked?
The War on Drugs
The War on Terrorism
The War on Rogue Banking (Basel I, II, II.5, and III)
They just bring more attention to the thing you’re warring on.
Hilariously, one of my graduate schoolmates equated the Basel Accords with a piñata that he was continuously striking without a blindfold on! Money just fell onto the floor for him and his buddies to pick up!
Let’s try some more. Have you heard of these?
Last Tango in Paris
Monty Python’s The Life of Brian
Each of these movies was banned in different countries. Absurdly (to me at least), the Egyptian government banned Funny Girl in Egypt because Omar Sharif, an Egyptian, and Barbara Streisand, a Jew, portrayed an on-screen romance. (Maybe he was too handsome for her, but a ban is a step too far.)
And what about these literary classics?
The Canterbury Tales
These books were banned in the United States for obscenity. Heck, The Grapes of Wrath, perhaps the Great American Novel, was banned in California for its allegedly unflattering portrayal of its residents.
And what do all these things have in common?
Everyone has at least heard of them. Perhaps even read or watched them. The Wife of Bath’s Tale, of The Canterbury Tales, was required reading in my high school English class.
Later in life, I was delighted to discover my old compliance officer lived on Tabard Street in London. That’s where the pilgrimage to Canterbury begins. Ah, the dinner parties he used to throw there!
Fond reminiscence aside, bans don’t work. Ever.
All they do is heighten curiosity. And from there, the public finds a way to accept, enjoy, and use whatever the subject of the ban was. Bans increase the allure.
Authoritarians don’t realize how they sound so very like the Red Queen screeching, “Off with her head!” every time they call for a ban. Of course, authoritarians slip into totalitarianism soon enough.
All this brings me to the latest victim of the now seemingly ubiquitous calls for a ban: Bitcoin.
Bitcoin is a Symptom, Not a Cause
Satoshi Nakamoto, whoever he/she/they was/were, created Bitcoin precisely because world governments fell asleep at the monetary wheel.
And what’s more, they acted in concert to end the last crisis. That’s right, the world governments put their little peabrains together and came up with a solution: Printing the living crap out of every one of our currencies to prop up asset prices.
There is one reason for this: older people have assets, and they vote. I don’t mean to sound ageist, especially as I’m knocking on the big 5-0, but Thomas Sowell put it best:
Do you want to know what the Fed really did to your money? On October 1, 2013, 1 BTC = $123.65499. That means that BTC 0.008087017 bought $1.00.
As of today, 1 BTC = $38,290.44853. So BTC 0.0000261161735 buys $1.
I’ll do the math for you: the USD has lost 99.68% of its value against BTC since October 2013.
Here’s a chart of that demise. It’s an obscenity!
If your buddies are HODLers, you can’t possibly blame them for looking at any USD holder like they’re from Mars.
If you saw that chart with no labels and thought it was a stock, would you buy it? Of course not! I’ve seen corpses with more life than that chart.
Since the evidence is obviously against the powers that be, they’ve got to resort to emotional and illogical arguments.
Please Edit These Idiotic Articles
The first, an opinion piece by Lee Reiners, executive director of the Global Financial Markets Center at Duke Law (God help us), is riddled with inaccuracies.
Luckily, my faith in the world was immediately restored by the Comments section, which utterly destroyed Reiner’s “arguments” piece by piece.
“Ransomware can’t succeed without cryptocurrency,” he writes.
It took me a little under 5 seconds to see that the first ransomware attack happened in 1989, a mere 20 years before Bitcoin was invented.
Reiners continues, “Banning anything runs counter to the American ethos, but as our experience with social media should teach us, the innovative isn’t always an unalloyed good. A sober assessment of cryptocurrency must conclude that the damage wrought by crypto-fueled ransomware vastly outweighs any benefits from cryptocurrency.”
Somebody must have forgotten to remind Mr. Reiners that anyone who owns Bitcoin protected their purchasing power, at the very least, or increased it. Reiners passes over this as if it doesn’t matter. That’s just ridiculous. In fact, that’s the very reason Nakamoto invented it.
Talk about fit for purpose!
Unmercifully, he keeps going: “It isn’t obvious that cryptocurrency provides any benefit at all beyond the chance to make a quick buck. I have been studying the crypto market since its inception, and I have yet to identify a single task or process that crypto makes easier, better, cheaper, or faster. Don’t take my word for it. Ask any friend why he owns cryptocurrency, and the answer will invariably be ‘to make money.’ In other words, speculation.”
The No True Scotsman fallacy is strong with this one.
“Isn’t it obvious..” “Ask anyone…” Sure.
Ask 50 different crypto enthusiasts why they’re enthusiastic about crypto, and you may very well get 50 different answers.
I have. And while some are positively thrilled with their gains, it wasn’t always about speculation.
The next piece is a thinly veiled cheerleading exercise that Beijing will do the dirty work of the U.S. government. It’s depressing.
Mike Bird writes, “The first and most obvious reason [for Beijing to smother the crypto sector] is the stated one: to limit the risk of financial excesses becoming a broader social issue.”
You’ve got to be kidding me.
No one has caused financial excesses more than central banks. It’s idiotic to worry about speculative cryptocurrency losses in this context.
He continues, “The second reason to smother bitcoin applies to mining particularly: The energy intensity of “mining” increasingly runs at odds with Beijing’s environmental goals.”
I’m literally laughing my ass off at this point.
My wife and I once visited Beijing. It’s well worth it. Days 1 and 2 were crystal clear, and we climbed the Great Wall.
I took this picture at Mutianyu, the rebuilt part of the wall, on a gorgeous day:
Then, on Day 3, I opened our hotel room curtains. I said to my wife, “I don’t remember a wall being here.”
As my eyes adjusted, I could start to see the outline of the building across the street.
Holy shit! It was smog. Filthy, toxic, disgusting smog. We barely left the hotel for the rest of the trip.
If Beijing’s goal were so laudable, they wouldn’t need a 10-year wait to start to comply with the Paris Accord.
“The third reason is… any avenues citizens might use to move money out of China easily will be under perpetual threat of closure.”
And there’s the onion—capital controls.
And why might the CCP need capital controls?
And there you have it, folks.
I hate to sound like an evangelist. I’m not. But let’s let the market decide if it’s going to be Bitcoin going forward. If the people prefer it to government fiat, then that’s their choice.
The whiny ban advocates’ “arguments” are not worthy of the name.
Have a fabulous day today!
All the best,