The Daily Hodl
  • FEATURES
    • News
    • Bitcoin
    • Ethereum
    • Ripple and XRP
    • Altcoins
    • Financeflux
    • Trading
    • NFTs
    • Blockchain
    • Futuremash
    • Regulators
    • Scams
    • Crypto 101
  • HODLX
    • Latest Stories
    • FAQ
    • Submit Guest Post
  • INDUSTRY ANNOUNCEMENTS
    • Latest
    • Press Releases
    • ChainWire
    • Sponsored Posts
    • Submit Your Content
  • CRYPTO MARKETS
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Binance Coin (BNB)
  • BEGINNERS
    • What Is Bitcoin?
    • What Is Blockchain?
    • What Does Hodl Mean?
    • How to Pay Your Bills with Bitcoin
    • Best Bitcoin FAQs
    • Example of Bitcoin’s Purpose
    • Cryptocurrency Has Multiple Meanings
    • Authenticator Alert – Securing Your Crypto
  • SUBMIT
    • Guest Post
    • Press Release
    • Sponsored Post
    • Advertise
  • EMAIL ALERTS
  • DAILY HODL MIX
No Result
View All Result
  • FEATURES
    • News
    • Bitcoin
    • Ethereum
    • Ripple and XRP
    • Altcoins
    • Financeflux
    • Trading
    • NFTs
    • Blockchain
    • Futuremash
    • Regulators
    • Scams
    • Crypto 101
  • HODLX
    • Latest Stories
    • FAQ
    • Submit Guest Post
  • INDUSTRY ANNOUNCEMENTS
    • Latest
    • Press Releases
    • ChainWire
    • Sponsored Posts
    • Submit Your Content
  • CRYPTO MARKETS
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Binance Coin (BNB)
  • BEGINNERS
    • What Is Bitcoin?
    • What Is Blockchain?
    • What Does Hodl Mean?
    • How to Pay Your Bills with Bitcoin
    • Best Bitcoin FAQs
    • Example of Bitcoin’s Purpose
    • Cryptocurrency Has Multiple Meanings
    • Authenticator Alert – Securing Your Crypto
  • SUBMIT
    • Guest Post
    • Press Release
    • Sponsored Post
    • Advertise
  • EMAIL ALERTS
  • DAILY HODL MIX
No Result
View All Result
The Daily Hodl
No Result
View All Result

Bitcoin and Crypto Hedge Fund Founder Charts Dystopian Future Where Governments Control Digital Currencies

by Daily Hodl Staff
February 14, 2019
in Regulators

Ari Paul, chief financial officer, managing partner and co-founder of crypto hedge fund BlockTower Capital, just dropped his vision of financial dystopia in an epic tweetstorm. Surveillance on steroids is coming to a society near you, courtesy of governments around the world that will try to brand, issue and operate their own highly trackable and traceable digital currencies.

Their most damaging feature will be a freeze-and-seize function that will allow a government to cut off your purchasing power and revoke your ownership rights at the flip of a bureaucratic switch.

Crypto fiat (i.e. government controlled permissioned cryptocurrencies) will be the biggest battleground globally for human rights over the next decade. China is leading the way, many other countries, including some big western democracies, will follow. https://t.co/8BqfmBJ2mP

— Ari Paul ?? (@AriDavidPaul) February 13, 2019

Writes Paul,

“Governments have a powerful incentive to require exclusive usage of crypto fiat. It makes tax enforcement easy, lets governments ‘turn off’ the money of criminals and political dissidents, and central banks love it for the real-time transparency and tighter monetary control.

I expect China and some others to first roll out crypto fiat, and then quickly thereafter to ban anything that competes with it: cash, non-crypto fiat, and if they enjoy significant usage, gold and public cryptocurrencies like Bitcoin.

Most money is already electronic. Going from electronic Yuan to crypto Yuan is pretty easy technologically but gives the government an entirely different level of transparency and control.

Imagine if an algorithm or bureaucrat could easily ‘turn off’ the money of 100,000 citizens with social media links to political dissidents. Not only would their money be frozen, but no one would be able to give them money. They’d be functionally cut off from society.

Currently we have privacy through obscurity. The Chinese (and US governments) can already track and freeze electronic money, but it’s very ‘expensive’ and manual. It requires patching together transactions across a long list of heterogeneous databases.

And freezing the money requires the involvement of numerous third parties (like brokerage firms) that obey government directives, but again, a lot of manual work for every freeze. With crypto fiat, it’s a click of a button across all platforms to freeze or confiscate money.

The people who are going to be most in need of cryptocurrency? My guess is the ~200m people in China out of favor with the government, and people in similar situations globally. It’s a staggeringly large pool of people.

Engineers sometimes argue with me about the distinction between crypto fiat and electronic fiat, since there’s little (if any) engineering difference. Probably the best way to frame it is in boring bureaucratic terms.

Currently when the SEC wants to investigate suspicious activity in equity markets, they have to go through a crazy process to track down the source of the trades, sometimes resulting in dead ends, because the trades go through a half dozen intermediaries.

It’s not that crypto fiat technologically enables anything that’s currently impossible with fiat, it’s that it removes the bureaucratic friction to such a degree as to enable qualitative, not just incremental, increase in government control.

One last example – imagine if Beijing law enforcement rolled out an algorithm that acted kind of like your credit card company – freezing your credit card on suspicious activity automatically. Now imagine if that applied to *all* money you have across any platform.

And if the algorithm was looking not just for outright criminal activity as we think of it, but of activity that an algorithm deemed possibly unpatriotic. And if to get access to your money again, you then had to confront a faceless bureaucracy, like the US no-fly list.

As with China’s social credit score, a great deal of the impact of such a policy is likely to come from ‘voluntary’ behavior changes among the population. If you have to be worried about an algorithm arbitrarily freezing all of your assets, may you avoid being friends.

With someone who occasionally criticizes the government. You might censor yourself and those around you to keep things easy. This creates a sharply bifurcated society, a separate underground economy and underground civil society fully divorced from mainstream.”

[the_ad id="42537"] [the_ad id="42536"]
Check Latest News Headlines


 
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Submit a Press Release

Industry Announcements

  • Polkadot and Composable Announced As Diamond Sponsor at the Cosmoverse’23 Conference in Istanbul
    October 3, 2023
  • BestChange.com Revolutionizes Cryptocurrency Exchanges With User-Centric Features and Trusted Network
    October 2, 2023
  • Radix Babylon Upgrade Marks New Era for Web 3.0 User and Developer Experience
    September 28, 2023
  • Tyrion Set To Decentralize the $377 Billion Digital Advertising Industry
    September 25, 2023
  • Hydranet Launches Layer Three Dex – A Game Changer for Trustless Cross-Chain Trading
    September 25, 2023
  • Ottochain Homage to EVMOS and Ethereum Layer Two
    September 21, 2023
  • Algorand Foundation Announces Build-a-Bull Hackathon in Collaboration With AWS
    September 20, 2023
Submit a Guest Post
ADVERTISEMENT
Bitcoin
$27,549.38
$27,549.38
0.02%
Ethereum
$1,646.96
$1,646.96
0.9%
Cardano
$0.25739
$0.25739
1.81%
XRP
$0.529811
$0.529811
4.16%
Dogecoin
$0.061191
$0.061191
1.25%

Spotlight

  • Former Facebook Executive and Diem Co-Creator Identifies New AI Opportunities Within Bitcoin Ecosystem
    September 27, 2023
  • JPMorgan CEO Jamie Dimon Says This Is the Number One Risk Threatening Global Economy – And It’s Not Inflation
    September 27, 2023
  • No One’s Prepared for Massive Cardano, XRP and Binance Coin Correction, Says Crypto Analyst Nicholas Merten
    September 27, 2023
  • Justin Sun Offers 5% Reward for Hackers That Stole $8,000,000 From Crypto Exchange HTX
    September 27, 2023
DON'T MISS A BEAT
Crypto headlines delivered daily
to your inbox
BTC, ETH, XRP news alert options
By joining The Daily Hodl news list you agree to our
Terms and Conditions and Privacy Policy.
Featured Image: Shutterstock/Billion Photos

Covering the future of finance, including macro, bitcoin, ethereum, crypto, and web 3.

Categories

Bitcoin • Ethereum • Trading •
Ripple and XRP • Altcoins •
Blockchain • Regulators •
Scams • Crypto101 • HodlX •
Futuremash • Financeflux •
Industry Announcements

 

ABOUT US | EDITORIAL POLICY | PRIVACY POLICY
TERMS AND CONDITIONS | CONTACT | ADVERTISE

JOIN US ON TELEGRAM

JOIN US ON X

JOIN US ON FACEBOOK

COPYRIGHT © 2017-2023 THE DAILY HODL

No Result
View All Result
  • FEATURES
    • News
    • Bitcoin
    • Ethereum
    • Ripple and XRP
    • Altcoins
    • Financeflux
    • Trading
    • NFTs
    • Blockchain
    • Futuremash
    • Regulators
    • Scams
    • Crypto 101
  • HODLX
    • Latest Stories
    • FAQ
    • Submit Guest Post
  • INDUSTRY ANNOUNCEMENTS
    • Latest
    • Press Releases
    • ChainWire
    • Sponsored Posts
    • Submit Your Content
  • CRYPTO MARKETS
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Binance Coin (BNB)
  • BEGINNERS
    • What Is Bitcoin?
    • What Is Blockchain?
    • What Does Hodl Mean?
    • How to Pay Your Bills with Bitcoin
    • Best Bitcoin FAQs
    • Example of Bitcoin’s Purpose
    • Cryptocurrency Has Multiple Meanings
    • Authenticator Alert – Securing Your Crypto
  • SUBMIT
    • Guest Post
    • Press Release
    • Sponsored Post
    • Advertise
  • EMAIL ALERTS
  • DAILY HODL MIX

© 2023 The Daily Hodl