So what is common in these three categories? Apparently the distaste for a centralized mechanism to control the capital flow in the international markets. Cryptocurrencies, as we all know, operates on blockchain technology which specifically use servers to run complex equations to generate unique number sets which are then utilized in peer to peer transaction maintained by decentralized and autonomous users across the globe. This mechanism has made cryptocurrencies virtually unhackable and resistant to national control which is the dominant political model of our times.
States don’t like that as is demonstrated by Chinese and South Koreans. Indonesians have gone a step further and criminalized the cryptocurrencies altogether. (View my earlier pieces on South Korea and Indonesia) But this week Europeans are back in the picture and are planning a global assault on cryptocurrencies by proposing regulations at G-20 meet in Argentina this march. But the contrarians to these moves are unexpected bedfellows.
Annie Machon, a former MI5 intelligence officer criticized the Brussels assault on the basic features of cryptocurrencies. Machon argues that Brussels which is under the influence of big banks and business lobbies is feeling threatened by the decentralized cryptocurrencies and thus trying to label it exclusively as the boon to money launderers and terrorists. Ms. Machon said that the decentralizing of the money supply is imminent but it can threaten the banks which European bureaucrats can’t tolerate.
So to counter the privacy concerns which are the biggest feature of cryptocurrencies with national security rhetoric is the most plausible way to do it. Surprising that EU is imitating the US behavior on this front while the US is avoiding such tactics regarding crypto rush.
The unexpected ally to Machon is Julian Assange who also criticized the EU’s clampdown. The entire WikiLeaks movement was built on suspicion of the centralized power of US national security bureaucracy. Assange claimed that rise of cryptocurrency is the response to the 2008 financial crisis. It is an attempt to bring the capital out from the hands of centralized figures and in the open democratic space. “Bitcoin is the real Occupy Wall Street”, he said at one moment in reference to the movement which rocked the New York streets in 2011 on rising income inequality.
The main concern of Europeans is the tax evasions and the movement of money away from centralized financial institutions which can hit the deep pockets of the European banking class and political Czars. So regulations must be ensured to tax the crypto market.
This is the defining battle of our times: Crypto anarchist vs. the authoritarian regulators. Not all regulations are bad but centralized bureaucracies are like meth addicts. As Milton Freidman once said, “If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.”
Let us all pray that the EU apparatchiks don’t get their way with cryptocurrencies.
Shubham Dwivedi