They Aren't Sending Their Best to Fight Bitcoin. Right?

I say it over and over again. They aren’t sending their best. I’m referring to the Gary Gensler interview on MSNBC’s SquawkBox Gary Gensler interview on MSNBC’s SquawkBox. It was interesting to listen to his criticisms of Bitcoin. It’s especially interesting when you realize that this man taught a course at MIT on Bitcoin. Many Bitcoiners are familiar with the course, and have called out his nonsense, his lies, and misrepresentation of Bitcoin since his time at MIT. I thought I would jot down some of my thoughts. Most Bitcoiners could write this but I wanted to get this out of my system. It seems pretty clear to me that Gary decided long ago to say what he needs to say to get into the positions he wants to get into. He’s a shill for fiat plain and simple. He’s a political animal. A bureaucrat who is doing the bidding of his overlords. With that out of the way, here are a few of the issues Gary Gensler seems to have with Bitcoin. More accurately, most of these are issues with crypto and the human race, not Bitcoin.

Fraud

While SBF wasn’t mentioned he’s the best example. This has nothing to do with Bitcoin. Fraud exists all over economies. What Gary is really pointing out is the SEC’s impotence. They cannot prevent fraud and Bitcoin just exposes their lack of power and control. The populace should not trust the state to keep them safe because it cannot. And if it cannot then why does it exist? Why does it (SEC) have a monopoly. What if we had many watchdogs over markets that one could go to for confirmation that an organization is operating above board. Oh yeah, we do. Its called Bitcoin’s block chain.

Bankruptcies

Yet another example of something that isn’t about Bitcoin. Its about companies taking risks and failing. Its about companies taking people’s money and doing foolish things with it. Its called a free market. When companies fail, people learn lessons. Come on Gary. You know this.

Centralization (Exchanges)

Gary said financial markets tend toward centralization. Gary was talking about crypto exchanges. He says there are only a handful. It is interesting to me to point this out as a weakness of Bitcoin when all fiat currencies are completely centralized. Exchanges are not the currencies. They are not the asset. The reason there are so few exchanges has more to do with Gary than Bitcoin. Bitcoin does have centralization risk. Its with miners but the threat comes from the state. Not the protocol or Bitcoin the asset.

Illegal activity

Gary was asked about the tired line about Bitcoin being used for criminal activity. The host mentioned Jamie Dimon’s comment that he would shut it down. As a reminder Dimon’s bank was the one used by Jeffrey Epstein. Epstein didn’t use Bitcoin. Joe Kernen would have none of it. He rightly pointed out that the criminal activity that uses the dollar far exceeds that done with Bitcoin. But this is really ceding the point. All currencies are used to do good and bad things. Always have been and always will be. The idea that someone like a banker could complain about this is laughable. Gary points out that Bitcoin is the leading token used by ransomeware. I do not know if that is accurate but it doesn’t matter. This is like pointing out that we should not use the Internet because it is used for bad things. This debate gets us off topic. The fact that Bitcoin is used as a medium of exchange by criminals is a strong case for its utility. One could even make the case that ransomeware is the ONLY thing that is forcing companies to improve their security. Those of us in the tech field have been pushing for greater security for years and have largely been ignored. Ransomeware threats have changed that.

Just an Accounting System

The one that really got me though was Gary saying “How many times do you have someone on this show saying they want to invest in something because of how the books and records are kept?”. Gary knows this is BS. What Gary is trying to do here is categorize Bitcoin as an asset only and not as peer to peer cash system. Its both and he knows it. Gary describes currencies as mediums of exchange that are used in an economic area such as the United States, the European Union, or China. While this isn’t wrong, Bitcoin breaks this model by making a currency that knows no borders, knows no managers, and has no centralized control mechanism. It is freedom money. Internet money. Anyone can use it and no one can stop you from using it.

Then Gary asked Joe Kernen if he trusted Bitcoin more than an Oracle database. That one took the cake. Bitcoin has a ledger that anyone can audit, which has thousands of instances (nodes) across the globe. Anyone can use their node to confirm their transactions. Bitcoin is open source. Anyone can audit the code. Anyone can use their node to audit the supply of currency in the system at any point in time. This has never existed in the history of humankind and to compare it to the dollar Is ridiculous on that face. He knows this. I believe he doesn’t want the masses to know what Bitcoin is. This is the real threat. The masses understanding the status quo and that there already exists a better system. The value of Bitcoin is not only that the supply is capped but that the network is secure and you do not have to trust third parties. You can directly transact with anyone using any amount over any distance. The accounting system and network are key to the value prop of Bitcoin. Gary says, “Its just an accounting ledger”. You know what. He makes a good point. This is what most shit coins are. Just an accounting ledger with no network affect, not decentralization, and no proof of work network protecting the ledger. But he wasn’t talking about crypto. He was talking about Bitcoin. Come on Gary.

Is this the best they can do?

Is Gary really this bad at speaking out against Bitcoin? Or is it that he doesn’t believe he needs to counter Bitcoin as a new currency, as a new store of value, as a revolutionary method of exchanging value and transporting it through time and space? My best guess is that Gary is used to going on these shows, like SquawkBox, and getting a bunch of softball questions with no follow-ups. No one usually forces him to prove his points with facts and data. He just depends on the fiat world to support his false claims without reservation. What I really wonder is that if Gary, for some reason, was willing to debate a good Bitcoiner on its merits would he actually come up with anything better than what we’ve heard from him so far? I really truly wish there were more critics of Bitcoin that would have a good honest debate. A debate on the merits of Bitcoin, its problems, its weaknesses, in an honest forum without stooping to these dumb, arguments that are easily quashed.

We Bitcoiners have these debates. We talk about the struggles and issues that Bitcoin could face, and it currently does face. We talk about its weaknesses as points of vulnerability. We also know that Bitcoin could be destroyed by the dollar if the central bankers would stop printing, would remove the power and ability of their system to inflate the currency. If they would simply go back to a Gold standard, but we know that this will never happen because it would require the central bankers and the politicians to have restraint. To put their well-being behind the rest of us. We know that they do not care about our long term well being. They only care about getting votes and enriching themselves. They are slaves to the fiat system of high time preference behavior.

Over the years of studying Bitcoin, I’ve come to the position that yes it is not perfect. There are issues, but I am not aware of any issues that make Bitcoin a worse standard to live on than fiat. It is superior in every way that I can see. I have concerns about privacy. I have concerns about mining centralization, but all of these concerns pale in comparison to the threat of fiat. Fiat will collapse, we know that it will happen. All fiat currencies eventually fail. All empires fall. And when the United States empire based on the US dollar fails, the carnage is going to be extreme. I’m thankful we do have an escape hatch. I’m thankful that we can use it today. It’s truly a reason for hope.