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In 2022, there are an estimated 425 million cryptocurrency users worldwide! That is to say that around 5% of humanity already owns cryptocurrencies. The use of cryptocurrencies is effective, and sometimes common, in the lives of many people. But cryptocurrencies can also be considered in their speculative nature. It is in this context that in recent years a number of critics have emerged to denounce the allegedly “libertarians” bitcoin (BTC). Deciphering attempts to politicize bitcoin.
What is libertarianism?
Libertarianism is, in its political form, essentially present in the United States. Libertarianism is based on the maximum assurance of individual freedoms by opposing coercion and subjugation. Clearly, libertarians defend an ideal of freedom based on private property and absolute respect for individual rights and they oppose systematic state intervention. They differ from the liberals (more ” to the left “) whose original spirit would have been diluted in the 20th century.
Therefore, it is interesting to note that the emergence of libertarianism is mainly at the end of the 20th century. This is happening alongside the expansion of neoliberalism, sometimes viewed by libertarians as a « faux » liberalism through the maintenance of public deficits, opposition to “letting go” with an ever-expanding regulatory framework, etc.
In addition, libertarianism sometimes joins in certain aspects the foundations of the Austrian school. And it is on this point that the link with bitcoin (BTC) emerges.
A project of monetary competition?
The Austrian school of economics brings together famous authors such as Mises and Friedrich Hayek. Friedrich Hayek is the author of a book called « Denationalisation of money » (1976) who advocates the end of monetary monopoly, that is to say the end of the existence of a single currency. Ihe objective of monetary competition is, through the confrontation of a multitude of private currencies, to ensure great efficiency in the mechanisms of economic adjustment. This would allow, according to Friedrich Hayek, to achieve better price stability. Likewise, it would avoid arbitrary monetary judgments on the part of governments and central banks.
The idea of creating one’s own currency for economic good is therefore theoretically formulated very early on. We will never know if this theory inspired the creator of bitcoin (BTC). Despite everything, it is clear that Friedrich Hayek prophesied the emergence of cryptocurrencies. He believed that the maintenance of monetary monopoly was a threat to individual freedom. Faced with this, he predicted that we would witness the emergence of currencies in a new form.
Bitcoin is not a political project…
The genesis of bitcoin is the only one to provide concrete answers. In the original paper of the creator of bitcoin, nothing indicates a priori a political will. It is simply a desire to go beyond the traditional financial system.
“A purely peer-to-peer version of e-money would allow online payments to be sent directly from one party to another without going through a financial institution. […] Although the system [financier] works well enough for most transactions, it still suffers from the inherent weaknesses of the trust-based model. Completely irreversible transactions are not really possible, because financial institutions cannot avoid the mediation of disputes. »
Satoshi Nakamoto, 2008 | White Paper du bitcoin
Nevertheless, the creation of the Bitcoin Foundation very early in 2012 shows a closeness between this first major association promoting bitcoin and libertarians. But bitcoin also joins the aspirations of a number of crypto-anarchists. In the original logic of bitcoin, opposing bitcoin is tantamount to being favorable to the traditional financial system. Those who criticize bitcoin today for being too “liberal” would therefore be favorable to the traditional financial system.
Therefore, there is no indication that bitcoin itself has a political purpose. By contrast, bitcoin has given rise to certain uses that appealed to libertarians early on. It is therefore a priori false to affirm that bitcoin is libertarian, it only takes certain forms a posteriori.
If libertarians helped spread bitcoin, it is clear that current bitcoin users are completely unaware of this. Therefore, bitcoin is not strictly political. We must also emphasize that libertarianism is based on total freedom of opinion and expression, and therefore the use of bitcoin is free for all ideological currents. By its very definition, “monetary libertarianism” opposes coercion and therefore cannot be seen as a “political project”. Critics of bitcoin are therefore essentially aimed at politicizing it.
« Cryptocommunisme »
We have therefore seen that the desire to politicize bitcoin came from a desire to divide in order to better curb the expansion of bitcoin. Of course, it is undeniable that bitcoin responds to liberal aspirations, but in the current state of things it is not so.
Some commentators have even lent themselves to saying that bitcoin was “extreme right”which does not appear to be justified in view of the elements set out.
Bitcoin is therefore above all composed of the diversity of its users. Some authors have even underlined the existence of a “cryptocommunist” current with the emergence of decentralized processes. Bitcoin would then also join the aspirations of Marxists who see state money as an instrument of domination. This is further proof that a properly libertarian bitcoin is an absurd idea. In addition, bitcoin joins the aspirations of the anarchists of « gauche » and of ” LAW “. In any case, perceiving bitcoin as something political is irrelevant, neither with its creation nor with its current use.
“Financial Populism”
For still other critical authors, cryptocurrencies would be doomed to disappear. Cryptocurrencies would not bring the innovations to society that they claim and this would be a speculative phenomenon. Nevertheless, the evolution of bitcoin in recent years contradicts this view of things. The number of cryptocurrency users is increasing and bitcoin has “financialized”. That is to say, the most likely hypothesis is that cryptocurrencies are gradually integrating, through democratization, into the complexity of the already existing system.
Therefore, some see cryptocurrencies as already being part of the financial system. Rumors of price manipulation by players in the financial system are spreading. Indeed, while major US banks sometimes firmly rejected the idea of bitcoin in 2017, they now seem to embrace it. Multiple projects are also developing with the technology underlying cryptocurrencies, i.e. blockchain.
Companies have already developed the tokenization of bonds for example. The links between the world of cryptocurrencies and traditional finance are now constant and strengthened. This may go against the original spirit of cryptocurrencies. But here again, critics see it as a “financial populism” radical and devastating… Which is not rational and is not the only current aspect of cryptocurrencies.
An issue of growth and poverty… forgotten
In 2017, the World Bank established that 30% of adults in the world population do not have a bank account. Nevertheless, more than two-thirds of adults without a bank account have a smartphone. More than a billion people would therefore still be without a bank account, while more than 600 million of them have a smartphone!
The figures are even more eloquent when we know that 85% of payments are made in cash on the planet, and that a banking transaction takes an average of 3 to 5 days to complete. Access to bank accounts is thus very easy in the West, where generally more than 90% of the adult population has a bank account. But in countries like Niger or the Philippines, less than 20% of the adult population has a bank account.
The first solution to this problem would be to promote the development of a banking network in these countries. But the financial, human and technical resources are lacking. Because a banking network already presupposes a sufficient level of technological and human development. This solution would take several decades to materialize and it could already be outdated when the time comes.
The second solution is provided by cryptocurrencies, whose adoption in some of these countries is already very strong. Cryptocurrencies are accessible with a simple smartphone and are generally faster than traditional banking transactions. A previous article had also led us to demonstrate statistically that the success of cryptocurrencies depended quite heavily on long-term population growth. Open criticism against cryptocurrencies never addresses this central aspect.
In conclusion
Bitcoin is a freely created, freely distributed, and freely accepted or rejected tool. In this sense, bitcoin is in no way a project that aims to impose a practice or a belief on individuals. Bitcoin was born simply from the desire to create a new exchange system. Still, it’s clear that bitcoin caught the attention of libertarians early on. Bitcoin also appears to be the manifestation of Friedrich Hayek’s prophecy of the imminent need for independent currencies.
In fact, it is clear that bitcoin brings together a diversity of ideological currents. Moreover, most of the 425 million cryptocurrency users are unaware of these ideological currents. It is therefore absurd to claim that bitcoin is a “political project”, because neither in its creation, nor in its current form, one can find ideological elements. It is rather the way people perceive bitcoin (positively or negatively) that induces the politicization of the latter.
Because according to the critics, bitcoin would be both libertarian, financial, anarcho-capitalist, anarcho-communist, cyberpunk, etc. The democratization of bitcoin indeed gives it a political and financial aspect. But the fact is that cryptocurrencies continue to spread, and without forgetting the abuses of the market, the latter is holding up in the sandstone of the storms. The democratization of cryptocurrencies is also a global issue for poverty and access to economic networks.
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Author of several books, economic and financial editor on several sites, for many years I have developed a real passion for the analysis and study of markets and the economy.