Governments are impotent against crypto.
This is a realization that has not been fully realized. Many, especially those in government, believe they can control it. While there are certain steps they can take, at this time, the future is one where their influence is diminishing.
Cryptocurrency was designed, according to the narrative, to fight back against tyranny. Of course, as the old saying goes, one man's tyranny it another's freedom fighter.
With the geopolitical situation in the world today, we see something interesting forming. There is a split, between the US and its allies versus, well, basically everyone else.
This is exemplified by the actions against Venezuela.
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Venezuela Thumbing Its Nose At US Sanctions
The Maduro administration is a long a target of the United States government. This is a country that has a lot of oil. Since it depends upon exports, cutting it off from the international market was the goal of the U.S. Naturally, the country turned to the usual tactics, something that is even less effective today.
What is Venezuela doing? Turning to crypto.
Venezuela’s state-owned oil company, Petróleos de Venezuela S.A. (PDVSA), is turning to crypto for its oil trades in response to renewed US sanctions that target the nation’s oil and gas industry, Reuters reported on Tuesday.
As noted, PDVSA has been utilizing the stablecoin Tether (USDT) for oil exports since the previous year. By the end of the first quarter of 2024, the company had successfully transitioned many of its spot transactions to contracts that require prepayment in USDT, and it now mandates that new customers make payments through a digital wallet.
Logic says this will set people like Elizabeth Warren off, giving her more ammunition in her quest to derail cryptocurrency. What she fails to understand is that cryptocurrency was designed to be neutral. Here is where it has a great deal of value.
People often misunderstand things like gold. The major value proposition there, from a government standpoint, is gold is neutral. If you have it in your possession, the US government cannot take it if you are Russia. The same is not true for the bonds it issues.
With Tether, we have a stablecoin issued on a blockchain that does not care who is using it. The company backing it is headquartered in Hong Kong while being incorporated in the US Virgin Islands.
This makes it hard to go after. Naturally, the USG could target the reserve since this is an asset backed currency.
That is the downfall of these forms of stablecoins.
The Other Side Of Tyranny
Whatever level we are focusing upon, there are always two sides to the tyranny equation. It gets very complicated when it comes to the tyrant under the thumb of tyranny.
Here is the situation with Maduro. Like most governments, the population experiences varying degrees of tyranny. This is likely one of the things the US government uses as justification for its actions. Of course, that is simply another form of tyranny.
As stated, the power in cryptocurrency is neutrality. It simply does not care.
When a blockchain is global, having as series of unrelated nodes located all over the world, this becomes a system that cannot be shut down. Tokenization tied to market trading means we have assets that can transfer value.
Suddenly, the power of entities such as the US government is drastically diminished. Actually, the same is true at all levels.
Any attempt at bans are going to prove fruitless. The technology is simply expanding daily, making it impossible to contain. Each day, more open source software is showing up. This is combined with more nodes, wallets, and transactions. The situation gets even more convoluted when integration into newer developments occurs.
Governments Showing The Way
It is a bit ironic that governments are showing us how impotent governments are becoming.
This situation exemplifies what is going to keep happening over the coming decades. The ability to control technology is going to keep hindering governments. Right now, the main push comes from corporations who are achieving levels that rival many governments in size. However, if we step back, the totality is what becomes evident.
Taken on one level, we can start with the premise that algorithms run significant part of our world, at least the digital. Who controls these algorithms? Presently, they mostly are in the hands of Big Tech. That said, what happens when the number of algorithms is overwhelmingly coming from individual entities, located everywhere? Going one step further, what happens when the code is open and can be duplicated near infinite times?
With blockchain, this is called a fork. These networks can replicate themselves hundreds of times. As the tentacles of development start to address different facets of infrastructure, this is only going to be a greater challenge.
The final piece to this puzzle is artificial intelligence. Since we are dealing with technology, other advancements impact what is taking place. If governments cannot control crypto, what are they going to do with AI? What happens when aspects of this technology are rolled into crypto infrastructure and applications on a mass scale?
Suddenly we are in an entire new ballgame, one our present forms of government were not designed to deal with.