This is an op-ed by Kelly Slaughter, associate professor of professional practice at the Neeley School of Business at Texas Christian University.
With elections due next month, it is almost impossible to find common ground between Liberals and Conservatives. But there is one issue that should unite red and blue voters: keeping Bitcoin free from government regulation.
To make this case, compare bitcoin to a potential central bank digital currency (CBDC), which is currently being explored based on a recommendation from a recent white house report. A CBDC does not provide all the benefits of bitcoin while introducing new risks.
The appeal of bitcoin and other cryptocurrencies is that they are not subject to central decision making. With a CBDC, the government could freeze digital accounts. As a replicated system, transactions between bitcoin holders cannot be restricted. Inspired by the same fear of having their assets accessible at the whim of anyone in power, red and blue should agree on the benefits of a platform without a selective “off” button.
The White House report claims that a CBDC could promote financial inclusion and fairness by allowing access to a broad set of consumers. Bitcoin is better positioned to do this. About 5% of American households are “unbanked”, that is, they do not have checking or savings accounts. the first two reasons for being unbanked are the inability to meet the minimum requirements and the lack of trust in banks. Bitcoin does not require a minimum balance and does not require trust in a governing institution.
In fact, Bitcoin most significant adoption it is found in poorer countries with high rates of unbanked households and high institutional distrust. The possibilities of social good as direct transfers they are huge. Liberals and conservatives may approach this issue from different perspectives, but both see the value of providing financial infrastructure for those without it.
Bitcoin is the most transparent financial system ever introduced and no central authority decides what is transparent and what is not made public. Anyone can access Bitcoin’s current and historical data. Even the code that runs Bitcoin is open for public review, including what changes were made and when.
The opportunities to take advantage of this transparency are immense. What happens if you pay your taxes to a government bitcoin address? What would happen if suppliers were paid in bitcoin? What if the government and vendors had to share their addresses publicly? We would have the most financially transparent government ever made, responsible for both the blue and red sides of the aisle.
There are a number of legitimate criticisms leveled at bitcoin. Regarding energy use, advocates and critics agree that a reduction in energy use is a worthwhile pursuit. Then we can recognize the progress that is being made in in transition a green mining.
What about scam and illegal activities? Bitcoin advocates are eager to get this kind of activity out of the system (although to be fair, what is the standard for an honest system? Are we asking more of Bitcoin than other systems?). While transparency alone can work against dishonest activity as seen in the legal embargo of cryptocurrencies, many Bitcoin advocates want to work with the government to introduce reasonable regulations.
Bitcoin experiences significant volatility and speculation. This is not the behavior we want in a coin and is a problem recognized by all bitcoin advocates. But we look at bitcoin from a 2022-based perspective as if the nature of money is static. In the history of our country, we have accepted foreign currency for official spending and allowed banks to print their own currency. The idea of what money does and how it behaves evolves. Bitcoin is just over a decade old and, if allowed, will also evolve based on our technical, economic and Social preferences
Bitcoin is not a replacement for the US dollar, it is an alternative. We accept that USD is an alternative currency, officially and by custom, all over the world. Barter without currency is still legal. We recognize several ways that people can transact. Both the red and blue parties recognize the value of having financial options: bitcoin is another option with unique benefits.
Bitcoin’s opponents argue that Bitcoin has no intrinsic value, unlike a government-backed fiat currency. But what is our government but an agreement between citizens? Consequently, citizens have the power to agree to the recognition of bitcoin as a means of transaction. With supporters to the right and left, let us accept that Bitcoin continues to evolve as a voluntary way for parties to choose to conduct business.
This is a guest post by Kelly Slaughter. The opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.