When Bitcoin first showed up, some voices described it as a “crypto revolution”. And we all know from history, that revolutions usually interfered with the state.
To understand why there is so much tension on the line government/cryptocurrency, we have to stop for a moment and think about some fundamental idea behind Bitcoin. One of the reasons why Satoshi Nakamoto had created his digital currency was to design a solution which will be an alternative for fiat money.
Bitcoin was also intended to eliminate any third party in transaction process by introducing peer-to-peer transactions. Such a solution is far more useful for the final customer, but it is also a significant change in the global economic system. Cryptocurrencies by definition exclude intermediaries in the whole process, which calls into question an entire complicated web of connections. An essential part of this system is the state itself.
Through all these years since the creation of Bitcoin, many governments have been struggling with the problem of proper legislation of cryptocurrencies. Some of them, like Malta, are open to the idea of digital money and see an opportunity in blockchain technology. Others are strictly against it – as you may read in our article about crypto regulations in India. This dilemma also applies to one of the most prominent players on the international arena: the United States.
Libra under government fire
Mark Zuckerberg has already had a close encounter with an American government. Back in 2018, he made testimony about privacy measures. It was a big blow for Facebook. For the first time in the whole history of this social media giant, someone attacked it on such a scale, accusing it of something that is an exact opposite of its policy: that it works against the good of its users.
But Zuckerberg has passed the test. His performance in the American Congress may not have been flawless, but efficient enough to push away most charges. But it left some scratches on Facebook opinion. And now the company has to face American authority once again. This time not Mark Zuckerberg, but David Marcus, Facebook’s blockchain lead, had to stand before the Senate Banking Committee.
As Dawid has already stated in his column, Libra may not be so perfect as Facebook describes it. But sadly, the government prefers to attack Marcus with some populist questions rather than discuss some technical issues. For example, one of the senators asked him about accepting his salary fully in Libra – Marcus stated that he would be pleased with that.
In the end, the whole hearing had surprisingly few actual questions about cryptocurrencies themselves. Senators were more concerned not about new cryptocurrency, but under whose development it is. The whole panel showed that government doesn’t care about blockchain and crypto, only about maintaining current technological status quo. On the other side, Marcus avoided references to crypto, too.
“We have only one real currency in the USA”
And by this, we’re moving to another star of the whole show. Donald Trump is known for having many opinions on even more topics. In the time of growing attention around the cryptocurrencies, he had to add something, too. In his tweets, he expressed his views on the cryptocurrency.
He attacked both Bitcoin and Libra, stating that cryptocurrencies, when unregulated and not under government control, are an undesirable element in the country. Trump pointed that cryptocurrencies are not real money; they don’t have any value and mentioned only about illegal activities, like drug trafficking. Some of the president’s words are especially meaningful:
“We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar!”
The leader of the United States has clearly described his approach to cryptocurrencies. They can’t coexist with fiat currency. Not only crypto are not “real”, but they also stand in the opposite to national currency, which is in the eyes of politics like Trump a civic good. And if something in its very nature tries to threaten this good, then it can’t be accepted by the state.
But, on the other hand: aren’t both cryptocurrencies and the United States built upon one idea: freedom? It’s a shame that they can’t cooperate.
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