Bitcoin is apolitical, but won’t be for much longer

JEd Cruz, the Republican U.S. Senator from Texas, said he wants the Lone Star State to be an “oasis on planet Earth for bitcoin.” [BTC] and crypto.” He said this, reiterating previous support for the state’s mining industry, during a keynote address at a Heritage Foundation event.

The Block reported that several speakers harshly criticized “the left side of the political aisle” during this “Bitcoin and the American Experience” conference. Cruz pointed to Massachusetts Senator Elizabeth Warren, a Democrat:

“Why does bitcoin make Elizabeth Warren spin and spin and twitch overnight? Because she wants her sticky little socialist fingers to control every penny of every one of our bank accounts.”

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Still, bitcoin and the broader crypto industry could largely be described as an experiment in liberalism. It is the “lowercase l” variety, or the political philosophy that takes a broad view of individual rights and equality.

Open-source and free-access blockchains allow anyone to participate in or use the monetary, government, and social tools built on them. Just as the U.S. Constitution codifies rules intended to promote “consent of the governed and equality before the law,” crypto uses code to enforce similar rights.

Yet, given the idiosyncrasies of our times, bitcoin increasingly seems to belong to the right, politically. That’s why we keep seeing politicians like Cruz call for crypto “oases” and Warren for the industry to be snuffed out.

It may seem disadvantageous for “the left” to assume this position, given how they share the higher goals that cryptography professes. Murtaza Hussain, a reporter for left-leaning publication The Intercept, recently wrote about “Liz Warren’s bitcoin blind spot,” noting that crypto could be a financial inclusion tool to counter corporate power and mitigate excesses. of the government.

“[A] The future world of these currencies, in which bitcoin has been regulated by virtuous progressives, will also be a world in which mass surveillance and social control are possible on a scale unprecedented in human history.” said Hussain, adding that the industry should not be above criticism.

See also: The privacy boom will change everything

Political progressives holding cryptocurrencies often take a similar view that elected officials should be involved in making this unique and emerging industry better for all – possibly through thoughtful regulation, support programs to expand the use or education of blockchain and constructive dialogue with industry leaders – rather than trying to undo it.

Part of a culture war

To some extent, this happens (and it often happens across the aisle). However, I predict that as this industry grows and becomes more relevant to elections, partisan opinions on crypto will likely solidify around the thoughts held by a few influential political leaders. The “culture war” between Republicans and Democrats seems inevitable.

This is, of course, a travesty – as it always is when political infighting prevents government action on issues where people (rather than elephants or donkeys, symbols of the two most major American political parties) should be the primary concern. This is all the more shocking given that there is compelling evidence that bitcoin, a non-state private currency, is above politics or even “apolitical”.

But it is also a pragmatic vision. In representative democracies like the United States, citizens delegate responsibility for simple and difficult issues to elected officials to write the rules and hire enforcers (regulators). Cryptography is a particularly complex issue that many people probably feel disconnected from (a growing number hold these assets but that remains a minority, and the technology is not yet widespread).

It is well established why the political left is worried about crypto. These are mostly the same “narratives” in the mainstream discourse on crypto: its environmental impact, consumer safety issues, and the negative sentiment around tax evasion, wealth hoarding, and capitalism in general.

As mentioned, there are many “progressive cases” for crypto, but it would help to quickly say why crypto belongs to the right. Both parties sometimes push for universalist agendas — there’s a populist argument for state-run health care, education and environmental action among right and left.

Current and future impact

Crypto, over time, could impact various government concerns, including health care, voting, and human rights, among other issues, and therefore could be considered another universalist project. But it’s important to think about the real things it affects now. That is, money.

There are distinct political issues today involving money – and therefore crypto. There is the question of what to do with billionaires, the question of how to raise taxes fairly, and questions about how best to regulate markets. The right and the left often disagree on these issues.

Crypto, as a financial technology, offers individuals strong protections over their wealth in terms of how they spend it, save it, and protect it. If leftists sometimes ask if billionaires should exist, crypto presents a way to deny that question. How to tax or confiscate wealth (ill-gotten gains or not) if you don’t have the keys?

The right, in general, is also more favorable to free markets. Crypto, due to its censorship-resistant attributes, can support the most open markets: all participants can engage in economic activity as they see fit. This can range from capital formation to creating markets around social media.

Regulatory agencies like the Food and Drug Administration, the Environmental Protection Agency, and the Securities and Exchange Commission—many of which are rooted in the progressive era of U.S. history—operate on the assumption that rampant capitalism causes social damage and must be monitored and contained.

Many crypto projects have their inception in a founder identifying some market inefficiency – sometimes the result of government or corporate interference – and offering a token to expand trading and rebalance the scales. This method has not always been successful, as evidenced by the number of failed initial coin offerings (ICOs).

Crypto, like politics itself, is often forward-looking in that it presents a way to reach a radically different potential world. The solution offered by crypto is to extend individual authority over their economic activity (sometimes called “sovereignty” in the industry), hoping that the right mix of tools, money, and people can act collectively for the best by doing good for themselves.

Progressives take a different approach. They may be concerned with promoting and maintaining individual rights, but the solutions they offer require a stronger, more sovereign state. This can be seen by observing the proposed mandates as allowing a well-endowed state to be the only competitor in the health care industry. Or the application of rules that could make companies less competitive in supporting so-called environmental or social justice.

This distinction is often why observers call it crypto libertarian. None of this is to say that crypto can’t be used even for socialist purposes, to use the bogeyman of Cruz. Or that crypto cannot or will not be incorporated back into the state, as we have seen. Crypto has become a source of tax revenue and is not always as “non-forfeitable” as is sometimes claimed. This reality poses a difficult question for the industry: what is all this for?

Last week, bitcoin philosopher, scholarly author, and Yale-NUS College Associate Professor Andrew M. Bailey wrote a Twitter thread outlining how the common belief that bitcoin “was born of right-wing or libertarian conspiracy theories” is incorrect. (Baileythough ideological, is genuinely interested in ideas, enjoys debate, and his research project/book, “Resistance Money,” with a number of equally honest self-proclaimed progressive bitcoiners, is instructive.)

Indeed, cryptocurrency shares a history and agenda with the radical, pro-privacy, and civil rights cryptographers known as “cypherpunks.” These non-compliant coders, male and female, were staunchly anti-authoritarian and “opposed the overreach of institutions (corporations and states) ‘by promoting the use of open-source and open-source technologies,'” Bailey explained.

See also: Bitcoin and the rise of Cypherpunks | James Lop

No disagreement there. However, although cypherpunks and crypto offer apolitical solutions to state or corporate supremacy in digital domains, politicians are increasingly interested in crypto. Lines will be drawn, even though they shouldn’t be. And as a simple fact, it’s clear that supporters – informed or ignorant of the history of crypto – will see crypto as part of their agenda or not. Crypto and progressives share many goals, but they differ radically on how to achieve them.

It is fair to say that the industry, which is increasingly politically engaged, could take it upon itself. To give Bailey the final word, perhaps crypto should be a little less pragmatic and go back to its intellectual roots.

“Digital authoritarianism – the use of computers to monitor and control – is on the rise. You don’t have to be right or left to see it,” Bailey said.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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