The Texas Bitcoin was held in Austin, Texas on March 5-6 with some notable guest speakers and Bitcoin ‘personalities’ as Andreas Antonopolous and Ravi Iyengar just to name a few.
Among these participants was Stefan Molyneux, the host of Freedomain Radio, who delivered a light-hearted yet poignant talk on the psychology behind money and it’s universal effect on society, government, and the way we think about money in general.
Bitcoin as a threat
Stefan started off by outlining the general problem with currencies. Since money is essentially the infrastructure of society, any attempts to change the monetary status quo is usually perceived as a direct threat by a lot of people.
When monetary systems collapse, services shut down, people can go hungry, lose their homes, and even die. Stefan cited such historic upheavals as the Khmer Rouge and the Russian revolution, which occurred as a direct result of changes to money.
“People hear that Bitcoin is messing with money and they view this as a terrifying scenario because they know how fragile the entire monetary ecosystem is that keeps them literally alive.”
Debt war chest
“The matrix is money,” says Stefan, “money keeps the rich rich and the poor poor.” He cites two of the biggest faults in the current fiat monetary system: inflation and debt. Debt, in particular, is what allows people to afford a lot of a lot of indulgences, the biggest of which is war.
Without the ability to create money out of debt to fund such resource-demanding exploits as war, there would be virtually no support nor incentive for any type of military conflict and aggression. He explains that the War on Drugs is another ‘black hole’ for money as the annual cost of this war is roughly US$41.3 billion according to a Harvard study, with US$25.7 billion spent by the states and over US$15.6 billion by the federal government.
“They [People] were gung-ho [when invade Iraq] because they weren’t going to see the bill,” explains Stefan. “We can afford a lot of immoral indulgences because people defer debt to the future generations.”
Old habits die hard
Bitcoin challenges wealthy people’s sense of entitlement because it levels the playing field - it doesn’t favor any one side in politics or otherwise as it is a protocol. Stefan states that Bitcoin has the potential to “release the entrepreneurial energies” of people with less money.
More importantly, it gives the lay person access to markets that they can not access currently. For example, one would have to shell out about US$3 million dollars for an IPO whereas Bitcoin can reduce that to nothing.
People associate money with statism, the Federal Reserve, paper money, and the government. Bitcoin challenges those perception since it is, as Stefan beautifully puts it, “a neutral arbiter for the exchange of disparate values.” Hence, the exchange of goods and value is driven by principles rather than by a drive to hedge against the the loss of value of money i.e. inflation.
Therefore, a lot of spending comes as a result from people’s fear that their money is expected to lose value over time, which stimulates people to invest it into real estate, stocks, etc.
“It’s painful how much of life we have to devote to protect ourselves from the Invisible thieves of the federal reserve,” says Stefan.
In a response to a question from the audience regarding the potential takeover of Bitcoin technology by the current establishment, Stefan pointed out that it is a valid point of concern. Without a doubt, predatory capitalism won’t sit by the wayside as the increasingly lucrative opportunities offered by cryptocurrencies such as Bitcoin gain popularity.
These so-called vulture-capitalists will attempt to hedge their bets by appealing to state regulatory agencies to socialize the costs while privatizing profits, masking it as a preventative measure against another Mt. Gox type crash.
Stefan sees this as an inevitable battle that will play out in the near future as crypto-currency enters the consciousness of the masses.
Bitcoin equals freedom (of the market)
Bitcoin enables the free market to actually function as it was intended.
Unlike the current monetary system, Bitcoin’s technology prevents incompetent and fraudulent businesses from succeeding. The whole point of a free market system is allowing inefficiency and incompetency to die a natural death instead of keeping them afloat with bailouts courtesy of the taxpayers, which is made possible by a debt-driven monetary system.
The failure of Bitcoin organizations is a blessing in disguise because “resources move to people who are better at doing what they’re doing,” explains Stefan. As he explains in his Q&A session, failures such as those of Mt. Gox are “the surest way to tell that it [Bitcoin] will succeed because the idiots are getting weeded out.” Failure of inefficient, incompetent, or fraudulent businesses releases the resources back to people who can handle them more competently.
On the flip-side, the technology behind Bitcoin allows people to directly ‘vote’ for businesses they view as beneficial. This could be anything from effective local businesses to global initiatives to charity campaigns without interference from the state.
As Stefan eloquently puts it,“Bitcoin is what money should always have been but technologically was unable to become.”
About Stefan Molyneux
Stefan Molyneux is the host of Freedomain Radio, the largest and most popular philosophy show in the world. He is an acclaimed public speaker and has interviewed world experts on moral philosophy, politics and relationships. He also spent 15 years as a software developer, manager and entrepreneur.