The Denationalization of Money

The Denationalization of Money

In 1974, Hayek penned The Denationalization of Money, a work that remains remarkably relevant today. He posited that a government monopoly on money was not only economically inefficient but also socially detrimental. His belief that politicizing money through a fiat currency system would lead to inflation, business cycles, and the erosion of individual liberties is increasingly evident in our current economic landscape.

The urgency for change is underscored by Jannet Yellen’s warnings about the national debt, Lyn Alden’s book Broken Money, and the financial community’s shift towards Bitcoin. Cryptocurrencies like Bitcoin are not the exact ‘ducat’ Hayek envisioned. However, they offer a tangible path away from state-controlled money and towards currency competition, aligning with his vision in a practical sense.

Since the time of the kings, wars have been fought through the debasement of currencies. Today, interest payments on the US National Debt exceed the budget for military spending. As Jannet Yellen points out, this is unsustainable. Something has to give!

Trump is the wrong solution to the problem if he can be accused of being smart about anything; it’s taking advantage of an opportunity to use people’s sense of fear for self-gain, just like hundreds of dictators before him.

The discontent that many people feel can be summed up in a simple yet profound way. Financial inequality drains the vitality of society, pushing individuals into a relentless downward spiral with no visible escape. While the broader implications may be clear to some, the visceral feeling of something being fundamentally broken is a sentiment shared by all. It’s no wonder they will back a dictatorship; they just want to burn it all down and start over.

The anti-war movement has been largely ineffective in constraining U.S. militarism over the past 70 years, despite significant public opposition to many of the wars and interventions, which does suggest that something more than just political activism and cultural revolution is needed. No political candidate for president has offered anything like a solution. Kennedy hinted at it with his rhetoric about dismantling the CIA and reducing military spending, but he lost all credibility with his support for The war in Gaza. In the past 70 years, protest demonstrations and even self-immolation have failed to have any impact on the growing military-industrial complex. Contrary to what Bob Dylan would say, “The times they are not A changing.”

What has changed?

Those of us who could grasp the implications of Bitcoin technology started to ask ourselves what it means for money, economics, and geopolitics, which is dominated by dollars.

Bitcoin blockchain technology is ironclad, and the Gini is out of the bottle. Fiat currency is temporary. Bitcoin will go from a popular Wall Street “Asset Class” to a medium of exchange and a unit of account. The people, wielding military power today, won’t even notice until they have to come calling with hat in hand, asking for spare change to wage a war.

In a world where people have a real choice to store and transact value in a global, censorship resistant, hard capped currency like Bitcoin, that power dynamic shifts dramatically. Suddenly, the state can no longer simply conjure up money to fund its agenda or surreptitiously tax savers through inflation. It would have to persuade people to willingly hand over their Bitcoin to fund its operations, which means leadership will be much more responsive to the actual needs and desires of the populace rather than those who benefit from war.

Who benefits from war? The makers of bombs and bullets, and those who back them with dollars and political support. Everybody else loses, and they are tired of getting pissed on.

Yeah, they are pissed off and doing something about it.

Who benefits from Bitcoin?

Everybody else!