Is Bitcoin A Financial Weapon?
There are many opinions on what Bitcoin really is. Some say its a financial revolution which will make governement fiat currencies obsolete. Some treat it as a digital store of value. Most of its buyers trade it as a speculative asset.
In this article I will outline reasons why I think Bitcoin is a financial weapon. And I will try to find out, who is behind it.
Three Types of Things in Economic Space
All economic elements can be categorized into three, distinct sets:
Only elements 1) and 3) represent real tangible wealth.
So what are government fiat currencies, bonds and cryptocurrencies?
They are tools used to TRANSFER real wealth (real assets) from certain entities to the others in time.
Fiat currencies - they lose value over time with monetary printing. This way wealth is redistributed from people who hold these currencies to people who buy assets which do not lose value over time. Also, the entity printing dollars or euros (as the only legal tender) at the cost of virtually zero - can gain enormous power, influence and wealth at the COST of others.
Ultimately, no one with the sane mind do not intents to own Bitcoins forever, until the end of life. We want to own things which are useful in real life. For example: beautiful homes in nice locations, cars, electronic equipment, great art, clothes, etc. Bitcoin is only useful as something we can exchange later for the same or more amounts of real assets. The same can be said about gov. currencies and gov. bonds.
In order for Bitcoin to be exchanged for ever higher amounts of real assets, ad infinitum...
There must always be people willing to exchange more and more of real assets for the same amount of Bitcoin!
Since Bitcoin DOES NOT (and never will) hold a worldwide monopoly as means of exchange - at some point people may start to prefer use something else to convert some of their wealth into.
All of this points to a conclusion that Bitcoin is a temporary financial tool - or weapon - transferring real wealth from certain hands into the hands of others. Which entity might gain the most using Bitcoin as such tool?
Who could create Bitcoin?
We are told to believe BTC is a invention made by a one fellow, Satoshi Nakamoto. However after a decade since his claimed invention, no one can prove that Satoshi as a human being and authentic BTC inventor even exists. The Inventor of such vehicle could be now worth anywhere from few billion dollars to a hundred billion dollars. Such wealth will not go unnoticed.
OVER A DECADE AFTER ITS INCEPTION....
NO ENTITY OR GROUP OF PEOPLE OFFICIALLY PRESENT THEMSELVES AS CREATORS OF BITCOIN !
Here are potential, probable authors of Bitcoin:
Let's closely examine who, out of these 5 entities, is the most likely. I assume that, the entity with the biggest economic and/or political motive to create Bitcoin is behind its creation.
CENTRAL BANKING CARTEL
Bitcoin has two main traits: its trading and storage is decentralized and its limited in quantity by design.
Central banks through history always operated with opposite traits: centralization and unlimited creation of currencies. That is the only way they can hold economic power over nations.
Why would central banks create bitcoin when they can create centralized digital currencies? Or digital currencies with centralized social credit scoring system? Point is, other types of currencies than BTC are more powerful from the standpoint of a central bank. Bitcoins cannot have automatic taxation built-in or negative interest rates. Central Bank Digital Currencies - can have these tools.
There is a popular notion, that BTC project is a bankers psy-op designed to make digitial currencies more familiar before central banks will roll them out on a global scale for the whole population. I see three problems with this idea:
1) Digital payments are already very popular in the West. And it will not work with older people - they still prefer cash and will not trade BTC no matter how high its will rise,
2) BTC is not even a currency,
3) BTC and other cryptos shift or more precisly DISPERSE power away from banks and central banks into many smaller companies who deal with cryptos - something which is clearly AGAINST the interest of the banking cartel.
Taking all these arguments together I conclude that its extremely unlikely that current banking cartel is behind Bitcoin.
CIA/NSA
These agencies main areas of operation are:
- "influencing" certain key people,
- collecting information about literally everything.
- political and economic activites, which I will not cover for obvious reasons....
None of these areas have much to do with a monetary system.
For this reason alone, I estimate that both agencies are the least likely to invent Bitcoin.
RUSSIAN MILITARY INTELLIGENCE
Russia is a country with the largest land mass of all countries. Extremely rich in natural resources: natural gas, oil, coal, iron, nickel, copper, tin, titanium, gold and uranium.
Russia is:
Russia foreign strategy was always to dominate in military technology. For example, their Avangard hypersonic weapons can travel with speeds up to 27 Mach. For a country of that size, military and economic power, there is of little importance to unleash Bitcoin. With one exception: they could invent Bitcoin to shift some demand from gold into bitcoin and thus lower the price of gold. With lower gold price, Russia's central bank is able to accumulate more of it.
Russia central banks gold holdings confirm, that the country is accumulating gold in recent decade.
Source - Trading Economics based on World Gold Council.
Before 2009 it had below 500 tonnes of gold, in the 3rd Quarter of 2020, they had 2299 tonnes.
Current costs to buy 1800 tonnes of gold equal to approx 100 Billion USD. For a country with about $420B in exports per year, lower price of gold is important economically.
Russia's military, was never suspected of any major financial-technological involvement. Their focus is on hard-core military power and economically - to continue being independent of any other countries.
Taking major aspects about Russia and its foreign policy, I highly doubt they are behind creation of Bitcoin.
SOME SILLICON VALLEY COMPANY?
Sillicon valley tech corporations could be inventors of Bitcoin since they employ the most tech-savvy people.
Some of the largest crypto exchanges are located in USA: Kraken, Coinbase.
Sillicon Valley ecosystems of companies, Venture Capital funds, angel investors and tech media operate in relative openness, certainly comparing to government agencies or a banking cartel. That is the prime reason why I would not expect them to be Bitcoin inventors.
Only recently in mid 2020 PayPal announced that it will allow cryptos to be supported by their platform. Still, the companies like Amazon, Google and Apple seem to operate and gain market share without any connection to either Bitcoin or other cryptocurrencies.
This does not strike out the option that some of the Sillicon Valley tech. experts may have been involved in creation of Bitcoin.
VISA OR MASTERCARD?
Bitcoin is a mix of technology and finance. The global companies which are also the most heavily involved in both of these industries are.... Visa and Mastercard. Why these two companies might be interested in creation of Bitcoin? Does it serve their own profit-making objective?
Finance industry is aware of the fact that all fiat currencies collapse at some point, since politicians always prefer to dilute the value of the currency rather than let the companies, pension funds etc go bankrupt when the debt bubbles get too big. When that happens people shift from worthless fiat currencies into hard money in the form of gold and silver. This can be a direct threat to Visa and Mastercard business which operates strictly with fiat currencies in digital form.
By creating a better alternative of government currencies, the one which is not subject to expansion of supply, like BTC, Visa and Mastercard can stay relevant even during times of hyperinflation and total collapse of all gov. currencies worldwide.
The thing is, both companies are too "transparent" to create such a vehicle, which is in opposition to gov. currencies without being exposed.
CHINA COMMUNIST PARTY?
Let us connect the following dots/facts:
With Bitcoin, China can accomplish many grand economic goals:
All these facts provide China Communist Party with enormous long-term strategic motive to create Bitcoin. However.... the sheer size of this organization, its rigidity and the fact that Chinese are good at copying others work, rarely at inventing completely new, COMPLEX solutions.... indicates that chances its CCP are on the low side.
ONE OF THE MOST RECKLESS & MULTI -TALENTED CRIMINAL - PAUL LEROUX
Evan Ratliff, wrote an incredible article in WIRED Magazine in 2019 suggesting Paul LeRoux might be the creator of Bitcoin.
This guy has a serious experience in cryptography and programming, esp. C++. He developed giant, criminal network in many countries. Creation of Bitcoin as alternative, anonymous, underground system of payment on rather limited scale (not as a worldwide currency...) - was something he DEFINITELY needed doing multiple hundred-million dollars activities. I deeply recommend reading the linked above WIRED article to see full scope of Paul's dealings.
Lets connect the dots:
Simply put: I cannot find any other entity besides a person like Paul LeRoux or other, yet unknown, similar mafia-like persona, more fitting into the required conditions to be a Bitcoin inventor. See excellect video summarizing LeRoux as strongest candidate for Satoshi - https://www.youtube.com/watch?v=cuItlQZ3RQg
------------------
Why Bitcoin Has Traits Of a Financial Weapon Rather Than "White Hat" Financial Salvation
There are two ways BTC can impact certain economy: in a positive or negative way.
Let's summarize what are the positive consequences of BTC popularity? I think that in the Western nations, there are none, since:
- Debt is higher than ever and quickly rising,
- BTC is not the only safe heaven from fiat currencies, since gold and silver were safe heaven long before BTC,
- Western central banks still print currencies out of thin air - BTC is irrelevant with this aspect,
- Corruption in the highest levels of society is on the rise, again BTC popularity is unable to stop this trend.
BTC popularity rises negative trends in the economy:
Copyright 2020 by Pawel Stadowski
There are many opinions on what Bitcoin really is. Some say its a financial revolution which will make governement fiat currencies obsolete. Some treat it as a digital store of value. Most of its buyers trade it as a speculative asset.
In this article I will outline reasons why I think Bitcoin is a financial weapon. And I will try to find out, who is behind it.
Three Types of Things in Economic Space
All economic elements can be categorized into three, distinct sets:
- Real assets themselves like: land, real estate, factories, companies, metals, commodities, works of art or titles of ownership of those,
- Virtual tokens which are NOT direct claims on any specific REAL asset, like: government fiat currencies, government bonds and cryptocurrencies,
- Technologies, intellectual properties, patents.
Only elements 1) and 3) represent real tangible wealth.
So what are government fiat currencies, bonds and cryptocurrencies?
They are tools used to TRANSFER real wealth (real assets) from certain entities to the others in time.
Fiat currencies - they lose value over time with monetary printing. This way wealth is redistributed from people who hold these currencies to people who buy assets which do not lose value over time. Also, the entity printing dollars or euros (as the only legal tender) at the cost of virtually zero - can gain enormous power, influence and wealth at the COST of others.
Ultimately, no one with the sane mind do not intents to own Bitcoins forever, until the end of life. We want to own things which are useful in real life. For example: beautiful homes in nice locations, cars, electronic equipment, great art, clothes, etc. Bitcoin is only useful as something we can exchange later for the same or more amounts of real assets. The same can be said about gov. currencies and gov. bonds.
In order for Bitcoin to be exchanged for ever higher amounts of real assets, ad infinitum...
There must always be people willing to exchange more and more of real assets for the same amount of Bitcoin!
Since Bitcoin DOES NOT (and never will) hold a worldwide monopoly as means of exchange - at some point people may start to prefer use something else to convert some of their wealth into.
All of this points to a conclusion that Bitcoin is a temporary financial tool - or weapon - transferring real wealth from certain hands into the hands of others. Which entity might gain the most using Bitcoin as such tool?
Who could create Bitcoin?
We are told to believe BTC is a invention made by a one fellow, Satoshi Nakamoto. However after a decade since his claimed invention, no one can prove that Satoshi as a human being and authentic BTC inventor even exists. The Inventor of such vehicle could be now worth anywhere from few billion dollars to a hundred billion dollars. Such wealth will not go unnoticed.
OVER A DECADE AFTER ITS INCEPTION....
NO ENTITY OR GROUP OF PEOPLE OFFICIALLY PRESENT THEMSELVES AS CREATORS OF BITCOIN !
Here are potential, probable authors of Bitcoin:
- Western central banking cartel (Fed, ECB, BIS, JP Morgan)
- CIA/NSA
- Visa or Mastercard
- Paul LeRoux - International Drug Dealer and Cryptography programmer
- China Communist Party
- Russian Military Intelligence
- Secret Sillicon Valley company
Let's closely examine who, out of these 5 entities, is the most likely. I assume that, the entity with the biggest economic and/or political motive to create Bitcoin is behind its creation.
CENTRAL BANKING CARTEL
Bitcoin has two main traits: its trading and storage is decentralized and its limited in quantity by design.
Central banks through history always operated with opposite traits: centralization and unlimited creation of currencies. That is the only way they can hold economic power over nations.
Why would central banks create bitcoin when they can create centralized digital currencies? Or digital currencies with centralized social credit scoring system? Point is, other types of currencies than BTC are more powerful from the standpoint of a central bank. Bitcoins cannot have automatic taxation built-in or negative interest rates. Central Bank Digital Currencies - can have these tools.
There is a popular notion, that BTC project is a bankers psy-op designed to make digitial currencies more familiar before central banks will roll them out on a global scale for the whole population. I see three problems with this idea:
1) Digital payments are already very popular in the West. And it will not work with older people - they still prefer cash and will not trade BTC no matter how high its will rise,
2) BTC is not even a currency,
3) BTC and other cryptos shift or more precisly DISPERSE power away from banks and central banks into many smaller companies who deal with cryptos - something which is clearly AGAINST the interest of the banking cartel.
Taking all these arguments together I conclude that its extremely unlikely that current banking cartel is behind Bitcoin.
CIA/NSA
These agencies main areas of operation are:
- "influencing" certain key people,
- collecting information about literally everything.
- political and economic activites, which I will not cover for obvious reasons....
None of these areas have much to do with a monetary system.
For this reason alone, I estimate that both agencies are the least likely to invent Bitcoin.
RUSSIAN MILITARY INTELLIGENCE
Russia is a country with the largest land mass of all countries. Extremely rich in natural resources: natural gas, oil, coal, iron, nickel, copper, tin, titanium, gold and uranium.
Russia is:
- 3rd largest producer of gold,
- 3rd largest producer of crude oil,
- 4th largest producer of silver,
- 2nd largest producer of natural gas,
- 9% of global reserves of uranium,
- 22% of global titanium production
Russia foreign strategy was always to dominate in military technology. For example, their Avangard hypersonic weapons can travel with speeds up to 27 Mach. For a country of that size, military and economic power, there is of little importance to unleash Bitcoin. With one exception: they could invent Bitcoin to shift some demand from gold into bitcoin and thus lower the price of gold. With lower gold price, Russia's central bank is able to accumulate more of it.
Russia central banks gold holdings confirm, that the country is accumulating gold in recent decade.
Source - Trading Economics based on World Gold Council.
Before 2009 it had below 500 tonnes of gold, in the 3rd Quarter of 2020, they had 2299 tonnes.
Current costs to buy 1800 tonnes of gold equal to approx 100 Billion USD. For a country with about $420B in exports per year, lower price of gold is important economically.
Russia's military, was never suspected of any major financial-technological involvement. Their focus is on hard-core military power and economically - to continue being independent of any other countries.
Taking major aspects about Russia and its foreign policy, I highly doubt they are behind creation of Bitcoin.
SOME SILLICON VALLEY COMPANY?
Sillicon valley tech corporations could be inventors of Bitcoin since they employ the most tech-savvy people.
Some of the largest crypto exchanges are located in USA: Kraken, Coinbase.
Sillicon Valley ecosystems of companies, Venture Capital funds, angel investors and tech media operate in relative openness, certainly comparing to government agencies or a banking cartel. That is the prime reason why I would not expect them to be Bitcoin inventors.
Only recently in mid 2020 PayPal announced that it will allow cryptos to be supported by their platform. Still, the companies like Amazon, Google and Apple seem to operate and gain market share without any connection to either Bitcoin or other cryptocurrencies.
This does not strike out the option that some of the Sillicon Valley tech. experts may have been involved in creation of Bitcoin.
VISA OR MASTERCARD?
Bitcoin is a mix of technology and finance. The global companies which are also the most heavily involved in both of these industries are.... Visa and Mastercard. Why these two companies might be interested in creation of Bitcoin? Does it serve their own profit-making objective?
Finance industry is aware of the fact that all fiat currencies collapse at some point, since politicians always prefer to dilute the value of the currency rather than let the companies, pension funds etc go bankrupt when the debt bubbles get too big. When that happens people shift from worthless fiat currencies into hard money in the form of gold and silver. This can be a direct threat to Visa and Mastercard business which operates strictly with fiat currencies in digital form.
By creating a better alternative of government currencies, the one which is not subject to expansion of supply, like BTC, Visa and Mastercard can stay relevant even during times of hyperinflation and total collapse of all gov. currencies worldwide.
The thing is, both companies are too "transparent" to create such a vehicle, which is in opposition to gov. currencies without being exposed.
CHINA COMMUNIST PARTY?
Let us connect the following dots/facts:
- CCP is the most secretive out of all major world economic powers,
- China does not disclose its official gold holdings,
- Bitcoin is often pictured as a gold coin with the Bitcoin symbol engraved on it. And called "digital gold"...
- China has the cheapest electricity, major cost of mining Bitcoins,
- University of Cambridge estimates that 65% of global BTC hashrate comes from China, half of it from one region of Xinjiang,
- Two major crypto exchanges originated from China: Binance and Huobi
- BTC is popular in 3 african countries: Nigeria, Kenya and South Africa, it might be designed to replace US Dollar there
With Bitcoin, China can accomplish many grand economic goals:
- shift demand from gold into BTC, lowering the price of gold,
- buy precious metals, foreign land or any other real assets with profits from BTC mining,
- diminish the power of the petrodollar, by providing an alternative mean of exchange,
- Direct the most techologically savvy and intelligent people in the Western population - into crypto industry or ecosystem, AWAY from industries which work on REAL economic or technological progress.
All these facts provide China Communist Party with enormous long-term strategic motive to create Bitcoin. However.... the sheer size of this organization, its rigidity and the fact that Chinese are good at copying others work, rarely at inventing completely new, COMPLEX solutions.... indicates that chances its CCP are on the low side.
ONE OF THE MOST RECKLESS & MULTI -TALENTED CRIMINAL - PAUL LEROUX
Evan Ratliff, wrote an incredible article in WIRED Magazine in 2019 suggesting Paul LeRoux might be the creator of Bitcoin.
This guy has a serious experience in cryptography and programming, esp. C++. He developed giant, criminal network in many countries. Creation of Bitcoin as alternative, anonymous, underground system of payment on rather limited scale (not as a worldwide currency...) - was something he DEFINITELY needed doing multiple hundred-million dollars activities. I deeply recommend reading the linked above WIRED article to see full scope of Paul's dealings.
Lets connect the dots:
- Experience in programming and encryption? Check.
- Experience in international finance? Check.
- Pressing, Urgent and Big Financial motive? Check.
- Ability to create Bitcoin in secret, underground and under the radar? Yep.
- Ability to create Bitcoin without the need of others? In case of Paul LeRoux - very possible.
Simply put: I cannot find any other entity besides a person like Paul LeRoux or other, yet unknown, similar mafia-like persona, more fitting into the required conditions to be a Bitcoin inventor. See excellect video summarizing LeRoux as strongest candidate for Satoshi - https://www.youtube.com/watch?v=cuItlQZ3RQg
------------------
Why Bitcoin Has Traits Of a Financial Weapon Rather Than "White Hat" Financial Salvation
There are two ways BTC can impact certain economy: in a positive or negative way.
Let's summarize what are the positive consequences of BTC popularity? I think that in the Western nations, there are none, since:
- Debt is higher than ever and quickly rising,
- BTC is not the only safe heaven from fiat currencies, since gold and silver were safe heaven long before BTC,
- Western central banks still print currencies out of thin air - BTC is irrelevant with this aspect,
- Corruption in the highest levels of society is on the rise, again BTC popularity is unable to stop this trend.
BTC popularity rises negative trends in the economy:
- promotes ownership of digital, virtual "assets" at the cost of ownership of REAL assets,
- shifts the most skillful people from other industries into Crypto space,
- creates opportunities for various financial scams
Copyright 2020 by Pawel Stadowski