Mark Carney, the governor of the Bank of England, today became the latest elitist to trash Bitcoin, commenting that it attracts “fools” and demanding that it must held to the “same standard” as other financial instruments. His comments follow on from wealthy investors like Paul Singer, who labeled Bitcoin as “utterly worthless”, and Charlie Munger, who commented that people involved in Bitcoin should be avoided “like the plague”.
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This narrative of trying to warn people away from bitcoin and cryptocurrency has started to heat up in 2018. It seems concerted; not a week goes by without some kind of public luminary making some grand statement about something they usually have limited knowledge of.
Speaking in Edinburgh, Carney called Bitcoin a “failure” and noted that it “[raises] a host of issues around consumer and investor protection, market integrity, money laundering, terrorism financing, tax evasion, and the circumvention of capital controls and international sanctions.”
Well, I would rather be a wealthy fool than a broke genius.
— AnonymousEconomist (@AnonOnAMoose) March 3, 2018
What Does Carney Mean by Failure?
Carney seems a trifle confused here with his definition of failure. If something works as the software enables — as Bitcoin does — is it failing or is it just not operating in the way Carney wishes?
It would be shooting the proverbial fish in a barrel to refute Carney’s point regarding crime; every Bitcoiner is tired of refuting the same, tired, stale talking points, and the entire world knows that the “issues” he is projecting onto Bitcoin are in fact the domain of fiat currencies: drug dealing, money laundering, terrorist financing.
The insight to take away here is that Carney is not misinformed or unintelligent. He is simply planting the seed in the mind of a public who are conditioned to believe that society’s elites have their best interests at heart. But, if we read between the lines and focus on what he is actually saying, it is clear Carney is effectively proving Bitcoin’s many use cases.
While he may call it a “failure” for “fools”, the fact that the governor of the Bank of England is dedicating time at the lecturn to rubbishing Bitcoin specifically, should make it clear that he knows Bitcoin is more than the flash in the pan or Ponzi scheme that many establishment icons portray.
And by arguing for holding BTC to the current “standard”, it may be prescient to enquire as to which standard he refers? The standard of the 99 percent or the standards of the elite where the profligacies of banks are bailed out by taxpayers or where insider information — seen today with former Trump advisor Carl Icahn’s selling of steel stocks prior to the airing of the President’s ‘trade war’ strategy – goes unpunished?
Bitcoin Is Still ‘The Future of Money’
Baroness Michelle Mone OBE, blockchain enthusiast and co-founder of EQUI exchange, touched on the issue, commenting that not only is crypto “not going away”, but that Carney and those in the establishment know “that the underlying technology has a place in the future of money”.
This highlights the narrative Carney and his ilk are pushing, one that is naggingly familiar to most Bitcoiners: that blockchain technology is good because ‘we’ can use it for things we control, but the Bitcoin softare protocol is bad because it gives people sovereignty over value.
Which, when you think about it, is the exact reason why Bitcoin was created in the first place. Satoshi’s embedded message in the genesis block was a swipe at government led cronyist policies, and the Bitcoin protocol was a way to change that.
Establishment Doesn’t Want What It Can’t Control
The establishment, however, is stuck between a rock and a hard place: how to control something that is not controlled by any one entity. The main thrust continues to be a push for regulation, delivered with the pretext of protecting consumers.
Some, like Lady Michelle, know that Bitcoin is revolutionary and that integration into the regulated system is probably inevitable:
“Nobody wants this to be the wild west anymore… a huge amount of innovation is happening. It’s not just about digital money. As [Carney] says, with smart contracts we can create new assets with new mechanisms for payment.”
So perhaps what is really happening is that Bitcoin is being pushed towards applications for the status quo and away from any of the elements of anarchy or libertarianism that initially helped sustain it. In essence, the establishment is attempting to influence the public sentiment towards crypto and mold bitcoin to the shape of the existing paradigm, which for some, but not all, may prove to be extremely beneficial.
But when Carney concern trolls Bitcoin by associating it with crime, what he is really saying is that a software protocol, owned by nobody, routes around government dictat and allows users to send value to whomever they want, without restriction or censorship. Depending on your situation or the agenda to which you ascribe, that can be viewed as either extrememly liberating or extremely dangerous.
Will Carney’s statements have any effect on Bitcoin’s growth? Let us know in the comments.
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