Bitcoin vs. Marx: A Clash of Ideological Titans
Marx tells us the revolution will be decentralized. The Have-nots will tire of the great inequity of capitalism, and the few thousand Haves will suffer from the worldwide rebellion they encouraged through their greed.
Building central banks and controlling the money supply will force the onset of Communism. Centralization of wealth leads to decentralized rage; the overthrow is inevitable. Class will be the deciding factor, and people of all stripes and sexes among the most developed nations will rebel first. The dominos will fall until the least developed countries finally industrialize, experience the same inequities, and become communists themselves.
This is not what happened, of course. Lenin adapted Marxism to suit his needs, and with the help of Communist sympathizers in the United States, Communism was implemented top-down in underdeveloped Russia. The dominoes toppled forcefully. Country after country fell into or out of Communism thanks to top-down or outside interests throughout the Cold War, always at the expense of the citizenry, and rarely at their behest.
Ironically, we discover, Communism has always been propped up by top-down physical force and moneyed interests, the very people Marx himself despised. Versions or elements of Communism now exist in China and the United States. One is an initially poor, now dystopian regime that plays capitalist games, and the other is a regime struggling between political correctness, a limp conservatism, and a central bank barely holding the economy together.
Satoshi Nakamoto, the pseudonym for the creator(s) of Bitcoin, makes no political statements. In his nine-page whitepaper and public postings, we learn how Bitcoin works, and whether it might succeed — by which he meant a high volume of transactions processed and a failure of entities to attack and delegitimize the network.
It is, however, well-established that Bitcoin’s deflationary monetary policy and peer-to-peer structure have roots in the insights of Austrian economists such as Ludwig von Mises, Friedrich von Hayek, and others — thinkers who developed their work in direct contrast to Marx and the historical, political bent of his dialectical materialism. It is no surprise then that theories have emerged about the political implications of adopting Bitcoin.
According to one theory, the most developed countries, particularly the United States, are closest to the fiat money printer. The strongest central bank is the one that runs the world’s reserve currency. The few who run that central bank can print unlimited amounts of money and launder it to suit their interests. Such interests will never align with that of their people’s, and particularly never of the countries forced to tether themselves to today’s global reserve currency, the US dollar. The dollar, not tied to gold or other hard money, will inflate into nothingness. Other central banks also printing money will suffer doubly. Their money is debasing, and the dollar on which their money relies is also debasing.
The people will figure this out, and tire of it. They will realize that they cannot store the value of their days’ work in a debasing currency, and will pull their money out of the fractional reserve banks that enable this endless printing. They will put this money into a hard asset, initially gold, and eventually Bitcoin.
Slowly, then suddenly, the revolution will be decentralized. The citizens of developed countries will invest in Bitcoin, but as relative winners in the fiat game, they will use it as a currency last. Similarly, the governments of the most developed countries will fail to take Bitcoin seriously, or be hostile to it. But the citizens of poor countries, and those with debased currencies, will leap to Bitcoin first. The poor will realize Bitcoin’s volatility is not so bad when their country’s currency hyper-inflates far faster. Its monetary policy is at least transparent. Who knows what happens in the offices of the Federal Reserve?
The citizens of smaller, poorer countries will store their value in bitcoin and transact with it. Smaller, poorer governments will see that Bitcoin gives them a way out of fiat’s approach of debt and debasement, adopting it as legal tender. The dominoes will fall. The Haves of the central banks will be overthrown, replaced by the Have-nots who had bitcoin first. The developed countries will be the last to catch on. And finally, thanks to Bitcoin’s deflationary monetary policy, the poor countries will have a leg up in this Orange New World. Someday we will live in a free-market paradise, where no one is in control of the money supply and economies can grow as The People will.
In both theories, the economic situation leads to a decentralized emotional/cultural phenomenon, namely a struggle against a corrupt oligopoly.
But when it comes to Bitcoin, this hasn’t happened as expected either. When Nayib Bukele, President of El Salvador and head of the party Nuevas Ideas, made his country the first to adopt Bitcoin as legal tender, citizen interest in Bitcoin in El Salvador was virtually 0%. Only a few bitcoiners from developed countries, who had made their home in touristy El Zonte beach, knew anything about Bitcoin. Today, the degree of citizen-wide adoption of Bitcoin in El Salvador is over 35% and rising, with some of the thanks going to the government’s Chivo wallet, and some to non-profit efforts such as Mi Primer Bitcoin. El Salvador’s domino fell mostly from top-down efforts, and as poor a country as it is, its other legal tender is the US Dollar, the world’s reserve currency. While El Salvador doesn’t have control of the dollar’s monetary policy, it is certainly doing better by adopting it compared to Argentina or Lebanon, whose currencies are terribly debased as of this writing.
Further, there are obvious falsities here. The United States hasn’t adopted Bitcoin as legal tender, but it sure has a lot of bitcoin. The IRS has holdings. Rumor even has it that other agencies confiscate, keep, and purchase bitcoin from time to time, the latter being particularly easy for a country that’s routinely printing money.
