Ross Ulbricht – the man who 12 strangers recently deemed to be rightful property of the state – is set to spend the rest of his otherwise productive life in a cage. But if you're interested in the future of cryptocurrency, whether or not Ross really ran the successful Silk Road website is beside the point.
Whatever you think about the victimless act of buying or selling “illicit” plants, consider the following:
1. Cryptocurrencies will do best where states are poor. Imagine for a moment how much the Ulbricht and Silk Road persecution cost the state in America.
Imagine how many state employees like Jared Deryeghiayan collected fat salaries – for years – to infiltrate the site's administrative operations. To track down and seize the servers on the other side of the world.
Imagine the manpower, computer power, caging facilities and weaponry used to carry out the capture and year-long caging of Ulbricht. Imagine the cost of the jail guards, state-employed hackers, judges, lawyers, prosecutors, police, and paper pushers. The “press” releases. The “evidence” collection and archival.
Over the years, it surely came to be a multi-million dollar operation. And for what?
Poor states around the world simply cannot afford to persecute people in this way. Operating on a fiat other than the petrodollar means that limited budgets are actually a reality for most states. Especially the poor ones.
These are the places where decentralized technologies – which are nothing if not the utter antithesis of the centralized state – will find fertile soil.
2. Victims of prohibition comprise a huge market – one that should be served. The state “prosecutor” Timothy Howard and FBI employee Ilhwan Yum claimed that blockchain evidence linked supposed drug payments to Ulbricht personally.
That's the thing about open ledgers – they're available for review by the ill-intentioned, as well.
And “Bitcoin maximalists” scoff at these coins, decrying that they detract from Bitcoin's “market cap.” That so-called altcoins hurt cryptocurrency's potential by diluting the “network effect” of Satoshi's coin.
These maximalists are in effect shunning a gargantuan (and growing) market for cryptocurrency.
Those seeking anonymous payments should instead be catered to, marketed to, and courted as customers, not swept under the rug as a kind of reputation stain.
You want mass adoption? Then look to drugs. It doesn't get more mass adopted than that.
3. Crypto users should not hope for or seek justice in state-run courts. Think for a moment of two of the most famous incidents in the history of Bitcoin.
Mark Karpeles, then-CEO of the world's most-used Bitcoin exchange Mt. Gox, made off (by mistake, incompetence, or outright theft) with millions of dollars of other peoples' bitcoins. The customer complaints have been overwhelming.
Mark Karpeles has never seen a state trial.
Contrast this scenario with Ross Ulbricht, who – if he was the ongoing administrator of the Silk Road – is a man whose entrepreneurial techniques should be studied in business classes around the world. Who had zero customer complaints. Who created something immensely useful out of mere zeros and ones, raking in a mountain of honestly-earned money on his own talent.
And if Ulbricht's appeal is lost, he's the one who will rot in a state cage for the rest of his life.
If it wasn't already immensely clear even before the invention of Bitcoin that state-run courts literally have no incentive to protect you – but every incentive to extort you – that should be all too clear now.
4. What makes a criminal again? Since when was it the role of a trial to examine a non-criminal, anyway? Most of us innately understand the true nature of crime – it's when you hurt another person or their property. Period.
But leave the definition of “crime” up to the state, and you get all sorts of wild returns. Wearing pants too low. Not mowing your own lawn often enough. Collecting rain water. If you want to make damn sure that one day you end up categorized as a criminal (if you're not already), just keep looking to state courts to define criminality.
Actual justice can instead be provided through contract-making, arbitration, and – most effectively – market reputation. In fact, arbitration is already hugely popular – just look at the fine print of your last “new hire” documents. And what a convenient coincidence – cryptocurrency just so happens to specialize in peer-to-peer smart contracts.
This is not a utopian vision. It's already happening. But the notion that justice could be provided by a monopoly? Now THAT's utopian.
Stay Safe, Children of the Future
If you use cryptocurrency, you're already operating in the future. If the saying is true – that everything that can be decentralized will be decentralized – you've got a killer advantage over late adopters.
If the decentralization of currency is desirable, then so too must be the decentralization of justice. Stop supporting state courts. Stop looking to them. Stop showing up to them. And if you've got no principles, then principles be damned – do it in your own self-interest.
And maybe – just maybe – the decentralization of all the things will bloom, after all.