DeutschDigital currencies have developed into an exciting asset class for many investors with more or less long-term speculation goals. On the other hand, they are now far more than that. For an increasing number of interested parties, currencies like Bitcoin today are crypto investments today a life-changing, even philosophical matter, which is not only about the return. Bitcoin, for example, was once
therefore developed to make people independent of traditional financial systems. People should be enabled to unsubscribe from “old” in favor of new networks. With the result that they become an equal member of the community in innovative systems, which is characterized by the spirit of the same mind and the same thinking. It is worth putting the philosophy of free choice in the context of Bitcoin and digital currency systems to the test.
Bitcoin as a Guide to a Self-Determined Financial Future?
An important aspect that deserves mention at this early stage: Bitcoin was the first cryptocurrency in the world to set an important course. Without the thoughts of BTC inventor Satoshi Nakamoto, the crypto world would not have developed at least at the speed that has been apparent for some years. Of course, there were other pioneers who were thinking about digitizing the financial world by creating virtual payment and currency systems at the same time as planning the Bitcoin universe. But Bitcoin has undoubtedly opened many doors and set considerations in motion in this context. If you ask experts about the successes of the blockchain and especially Bitcoin, there is some criticism on the other hand.
What Role Will Politics Play in the World of Cryptocurrencies in the Future?
Rüdiger Weis, a computer scientist and cryptographer with a professorship for computer science at the Berlin Beuth University of Technology, has repeatedly stated in the past that many of the (basic) democratic ideas have fallen by the wayside in the Bitcoin system over the years. And more than that. Weis sees the “democratic approach” hardly given today and even refers to dangers for the area of privacy in statements. Especially in the last-mentioned point, not only Bitcoin users of the first hour had great hopes. Many users dreamed that the blockchain would herald the “end of the state” as we know it. Despite all the positive changes in the financial world, little of this has been seen so far. Nevertheless, there are important developments that suggest that there is something that can be described as a philosophy of free choice.
Digital Currency Systems as a Beacon of Hope for the Disadvantaged
For example, people in regions who previously had basically no access to the traditional banking system can now send money around the globe thanks to the blockchain, even without their own bank account. The success of Litecoin and other cryptocurrencies in some African countries should be mentioned here as an example. The blockchain and comparable technological concepts close global supply gaps. Apart from this group of users, people who are skeptical of state monetary systems also benefited from the blockchain early on. The fact that more and more banks and financial service providers are recognizing the opportunities of digital currencies and the underlying networks suggests that Bitcoin’s liberal approach has by no means failed.
New currency systems of the digital world, in which every user can understand the systemic function in a democratic way, are now existent. However, state controls play an increasingly important role in many countries. Many governments – especially in the USA, China or the EU – are increasingly trying to maintain or regain the control they thought they had lost through regulations and the obligation to license.
Free Choice is Only Available if all Network Users Have the Same Level of Knowledge
From a philosophical point of view, concerning free choice, not least an urgent question arises: Are all members of the crypto world really able to develop a sufficient understanding of the opportunities and advantages, but also the risks of the Bitcoin blockchain and similar systems? Of course, this refers to investors who do not enter the crypto sector solely because they are looking for high returns that are no longer achievable in the traditional system. Whereby the monetary aspect is without question a central one when it comes to the “Bitcoin system”. As a purely digital financial system, Bitcoin certainly offers answers to problems such as rising inflation rates and the falling interest rate level as an investment dilemma. In addition, the global Corona pandemic has shown how important new concepts are in terms of digitization.
Worth reading: Is Bitcoin the only true cryptocurrency?
Cryptocurrencies Can Only Supplement the Traditional System
In order to understand the technological user of blockchain networks, it is also worth clearing up some rumors. The majority of developers of digital systems did not set out to implement anarchist ideas about cryptocurrencies. However, the way in which states economically control citizens in many places and patronize the population is very much a trigger for the development. And it still is today. Existing financial systems have failed in this regard, especially at one point. Instead of doing justice to the wishes and interests of the majority, “the system” largely serves a relatively small minority. In addition, classic cash still largely determines the status quo and the measure of all things.
Cash Will Continue to Play an Essential Role in the Financial System
The intention here is not to give the impression that the cash system has become obsolete across the board. Rather, in view of the aforementioned inflation/devaluation of money and the increasing wealth of a few (also and especially during the pandemic), it becomes clear that cash, in addition to advantages – such as anonymous use for payments in everyday life – is characterized by some weaknesses. The same applies despite all efforts for the digital use of fiat currencies. Here, Bitcoin and Co. are characterized in many ways by positive characteristics. The lack of legislation solely from the perspective of state control bodies makes cryptocurrencies and the blockchain an adequate instrument towards more democracy.
Governments are Increasingly Trying to Influence the Crypto World
The fact that the state is working in various ways to ensure that profits from speculation with cryptocurrencies and newly emerging financial products such as CFDs, NFTs and other variants of digital securities are taxable and that taxes are properly paid does not contradict the aforementioned philosophy of free choice and freedoms of crypto users. This is more of a logical consequence. The fact that governments are dealing with the issue of taxation is even an indication that Bitcoin and the now seemingly endless selection of cryptocurrencies are also being taken seriously politically as an area of the changing financial market.
Increasing Crypto Acceptance Puts Pressure on Politics
As far as the political component is concerned, the successive acceptance of digital currency systems raises the question of whether and how the exit from existing systems can succeed at all. The increasing activity of many states shows: Leaving the state system is hardly possible. Compared to fiat money, Bitcoin is stateless, so to speak. In this respect, its use at least allows users to say goodbye to traditional financial systems to a limited extent. But here, too, legal loopholes are increasingly being closed and gray areas are being closed by legislators. The look at the USA and the difficulties in approving Bitcoin funds and futures is the best proof that crypto networks are gradually reaching legal limits.
Worth reading: Understanding Bitcoin: More than digital money
Political Decision-Makers Will Help Determine the Fate of the Crypto Market
It doesn’t work without the state. It could be formulated awkwardly: No state can be made without the state. At the latest when crypto systems penetrate everyday life, politics interferes sooner or later. The term statelessness thereby loses some of its effectiveness. Although this assessment only reflects the author’s opinion for the time being. However, political developments suggest that the state will have an even greater influence on Bitcoin and cryptocurrencies in general in the future. A significant exception in this case are completely anonymously working digital currencies such as privacy coins. They offer authorities hardly any point of attack. No wonder, then, that such currencies are a thorn in the side of many states. Politics suspects a danger to the sovereignty of the traditional financial system, especially in this area. Nevertheless, or precisely because of the anonymity of such currencies as Monero, coins in the segment are met with approval by many crypto fans.
How Quickly Does the Established System Adapt to Change?
Ultimately, against the background of the preceding aspects, it becomes clear that the philosophy of free choice is a complex topic. With regard to Bitcoin, it must be taken into account that the system fails to meet its own requirements – for example, with regard to anonymous transactions and real independence from long-standing financial systems. It is correct that the exclusion from the banking system to the sovereign crypto network will most likely not succeed in the collective, i.e. all at once. A gradual changeover is more obvious. Individuals can undoubtedly initiate change by switching to Bitcoin and the blockchain. The possibilities for the state to exert influence and the power of the same cannot be broken in a relatively small time window of just over a decade. The state itself is the big problem. The more people understand the crypto universe as an alternative, the sooner politics worldwide will have to react to the new needs.
Bitcoin (and its competitors) can, but does not have to be the perfect way to achieve the “big” upheaval based on the philosophy of free choice. Many people will not succeed in leaving the old system behind. The more individuals opt for the crypto area as a model alongside the traditional financial system, the sooner those responsible in the old system will have to open up to alternatives. As the saying goes: Constant dripping wears away the stone.
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