In a podcast published about 2 weeks ago by Third Row Tesla's YouTube account, Elon Musk reveals and expands on what has been up until now, his otherwise annoyingly guarded views regarding cryptocurrency. Despite some obvious grumblings from a few "crypto-people" on social media outlets (just as Musk predicts will happen as a prelude to providing his opinions), it seems as though most crypto enthusiasts were highly receptive to his commentary and the market reaction was very positive. As of the publishing of this post Bitcoin's price surpassed $10,000 yet again. Up almost $2,000 since the Elon Musk podcast aired. So who the hell is he? I'll tell you who he is. He is Bitman.
While Musk's viewpoint is laced with pessimism as far as what he believes will be the ultimate prospective function of cryptocurrency, his conclusions are logical, reserved, well analyzed, and if nothing else, seemed genuinely transparent. I did detect a hint of cynicism in his cryptocurrency thesis (probably based in his envying Satoshi's idea, wishing he came up with it first) although, he doesn't shy away from praising the Bitcoin fundamental, and the potential cryptocurrency has for the future. He certainly doesn't discount it as a financial medium, quite the contrary. As a matter of fact, in his future, cryptocurrency would remain relevant indefinitely. Here are a couple points he made:
While I personally disagree with the idea that cryptocurrency's highest and best use is for illegal and quasi-legal transactions, or even for just those without governance, I believe it is that particular characteristic that will be its ultimate foothold to become saturated in the marketplace, more reachable all the way down to Jane and John Everyman. I know "crypto-purists" would probably not agree with this methodology, but everything has to start somewhere.
I do agree with Musk's ultimate conclusion that cryptocurrency will not be the primary financial database for humanity. I've explained my own opinion on that in the conclusion below. Here's a Link to the podcast in case you're interested and some cover art of what would be used for the show if I were the production designer.
If an individual resides legally in the United States and has already established their financial ecosystem - that is, how one might receive and subsequently store funds: Banks, PayPal, cash under a mattress, whatever it might be - if they have not already dabbled in it, I can imagine cryptocurrency is of little interest to that individual at the present moment. That is because in the United States, a legal resident who is simply accepting legitimate payments and sending legitimate transactions can send, receive and pay for products in a myriad of different manners, almost anytime of day, any day of the year.
There's very little restriction with banking in the United States, if you are a legal resident with proper KYC documentation. You can open accounts that will allow you to move money very flexibly during the course of a normal business day, and nowadays, after hours and holidays as well. Even if you are breaking the law with your financial transactions, you can still move illicit gains rather freely, so long as you have the proper identification to verify who you are when you open an account. Now, that's not to say you wouldn't get jammed up on the back end with a trail, but as far as initiating a transaction or opening an account to store funding, it's very easy for anyone whether criminal or not.
I know it's not as easy in many other countries to do these types of things with banking, so perhaps cryptocurrency has more of an "actual use" value to the citizens that make up those financial ecosystems. I can't speak to the validity of that statement, just hypothesizing based on the vibe I get. It appears that cryptocurrency's use has more value in countries where its citizens find it difficult to move money without it being preyed upon or otherwise scrutinized. That's why I believe that in order to get cryptocurrency in the hands of more people, at least in the United States, those who perform the illegal and quasi-legal transactions I refer to, need to use cryptocurrency more often. And I don't necessarily mean people who are buying guns or drugs, or anything like that.
Maybe someone is just trying to hide some money and not pay taxes on it, something as simple as that.
Here's a hypothetical scenario that could very well be true somewhere. There is a woman somewhere whose husband doesn't allow her to keep her own money, and he wants control of everything in the household. For whatever reason, because of children or other circumstances, she feels she can't speak up and gain control of her funds. But, she could secretly harbor them in cryptocurrency and know those funds are safe. While they may fluctuate in value, she can still feel comfortable knowing her money's not going anywhere. Because until she reveals it, transacts it, or gives away her password or seed phrase to the wallet where funds are stored, it's not really hers. It belongs to the blockchain.
Another small, innocent, real time example would be somebody who wants to trade crypto back and forth on, say binance, but doesn't want to get a 1099 in the mail and have to pay 25% of any proceeds to the federal government. Thank God binance agrees with that individual's way of life and doesn't want to send the 1099 to them in the first place. In any event, that person might be interested in harboring their money in cryptocurrency, because in their opinion, the government doesn't need to know every move being made financially in that person's life. Especially when the government hasn't provided that resident with any guidance on how to invest or where to invest. The government hasn't even provided them with a course or proper training on how to pay the very taxes being sought out for extraction from savings and reserves for day-to-day living expenses. so that individual doesn't know how the hell he's supposed to be paying tax on the crypto earnings in the first place. Public School systems sure as hell didn't teach them, they had to learn about the tax system on their own and learn the hard way. What a piss poor business model that is:
- Give us your money. We're not going to show you exactly how much to pay or what the appropriate way to pay it is, so here - what most communities offer as a solution - take more of that hard earned money, and pay someone else to do it - like an accountant - they'll do it for you and you won't have the burden of knowing where your money is actually going, or understanding why you're paying a particular amount - it's really a crapshoot, but you don't need to know all the fine print details. I mean we wouldn't want you asking questions, that's really what we're getting at. And to top it all off, when we're unsure of what to do with a particular security or how to tax it, we're just going to kind of shoot-from-the-hip as far as determining its legality and if it's even taxable... Maybe just see what people do in general, and then follow that model. Sorry, no idea men over here, we do print our own money, but we don't hire idea men.
As citizens of planet Earth, upon being set free as an adult onto the world, we all one day have to fend for ourselves and many times make it on our own with no help, without even guidance of our parents or guardians. One thing I've learned that I was never taught when I was a child, was having a surplus of personal funding is a 100% necessity if you plan to really make something of yourself. Plan on having family? Better put an exponent on whatever amount you put in your mind. The younger children are taught this cold hard fact the smarter the world will be. And, as good as the parent or guardian's intentions may be when raising the child, they usually only perpetuate the historical bullshit of the typical government business model.
Now why the hell should that individual pay any money to the government on profits? Governments manufacture money on a ridiculous level and are in trillions of dollars worth of debt. I mean THE WORLD DEBT CLOCK? The original concept behind that must have started as a joke. All that tells me is no one should ever lend money to any country in the world because they never pay it back. I'm obviously ranting and raving, exaggerating and oversimplifying things on purpose here a bit. I do understand the way taxation works, I'm not a fool, I understand the overall concept of contributing to a greater good to make the world go round, roads need building, fireman and policeman require compensation, funding for waste management... I mean, public schools...etc. I get all that. But as you get older you wonder, is my money really going toward those things? I mean people say it does, and there are elected officials or some other regulatory body supposedly checking out the logistics and chain of custody on that for us, but often times it seems like a huge sociological experiment.
If the government can just manufacture its own money, then, in essence, they manufacture their own debt. The creme de la creme, they then use monies which are supposed taxpayer funds, to bail out big corporate Banks, who countless times have been not just criminally negligent, but knowingly committed felonious financial crimes against those very taxpayers. They promoted overcharging and predatory lending practices upon them, then use their tax money to buy big pink yachts for the CEOs or whatever the hell they did with the money. So why do it? Why give them that money? Why not open a new bank with more responsible people that can build something better? Is it simply because, historically they are known, so its associated with brand recognition? Probably has something more to do with the number of outstanding notes the bank owns in the country or how much influence they have abroad. Or, well... In my mind I picture it like this... scumbaggy businessman from the 1980s getting together and jerking each other off, figuratively of course, which I envision some dude in a pink cardigan wearing blue Sperrys playing golf with some other douchebag who sits on a golden toilet every morning, essentially making a connection between Banks or between countries or assisting the funding of whatever carnival full of bullshit the the other one is running. And, these people probably have zero actual real time training to be in the negotiating position they are in, they're probably born into it or had it otherwise handed to them.
But if humanity continues to bow to big Banks simply because they've been around longer then any human that's currently alive, then I would have to say fuck those banking vampires, let's shove some garlic down their throats and jam some wooden stakes into their hearts. Unfortunately our governments have made these wonderful decisions for us, I don't remember rushing to vote to approve the bailout of the banking vampires of yesteryear. I'd love to see how they would get the voters approval for that... my tax money being implemented into that shit festival, how would that happen? I'm sure it would somehow though. The governments of the world are to blame for that fiasco, for propping up criminals in $5,000 suits.
So that individual is paying taxes to facilitate that kind of action? Well nobody informed him of that in high school, when he was being taught curriculum provided by the government, which had absolutely nothing to do with money, or even basic financial knowledge. So why pay then? Because historically it's what people do? Because it's the law of the land? Well maybe in the law books that govern this particular individual's world, historically, people are fucking morons and should grow a goddamn backbone. Because that individual finds it ironic to see what financial laws the supposed officials of that government break and get away with, all the way up to the president of the United States, on a daily basis. Rob the poor keep them poor, it feeds the rich and keeps them rich. Good thing the government has to prove that individual actually owns cryptocurrency to begin with to have any recourse warranting tax collection. Good thing they live anonymously, as most people should.
Getting back to the matter at hand here, allow me to draw a couple current and old world examples of ideas that have succeeded with a similar "darkside" prospectus as cryptocurrency. Let's call it - born in darkness it became light -
- Kali Linux: Security professionals often use the techniques of hackers against them, since those very techniques can be engineered and used to protect instead of infiltrate. The Kali Linux operating system is probably one of the best offensive/defensive mechanisms against a malicious actor and means of pen-testing a system. And, the tools it holds within, were designed by those very malicious actors it now protects against.
- Netflix and Spotify: These companies and those like it, to me are simply The Pirate Bay or "insert favorite app for pirated media here" with a monthly subscription fee, friendly GUI, and billions of dollars in cash flow, to which they can now use to improve upon their platforms. These companies, and those like it, took the basic interface of p2p pirated media sharing software like Napster, Morpheus, Kaaza, etc, enhanced it, and turned it into a legitimate cash cow through start up funding and purchasing of streaming content/copyright agreements and backroom dealings with the MPAA and RIAA (Motion Picture and Recording Industry Associations of America). Not only that, but these companies were pitched to early investors and content owners as the best feasible ways to combat the pirating of digital media. Smart approach. Steal the idea from the thief and then use it against him.
- Pirates and Privateers: A pirate is known to be a sea-bound scoundrel who will attack your ship, steal your cargo and kill you and your crew. A Privateer is pretty much the same thing, except they have a license from the government of whatever country they hail from. And so long as they pay a percentage of their bounties to that government, they can operate freely, attacking people at will with the blessing of their country's armed forces behind them. Some privateers ended up becoming the richest people in the world, and they owe their job description and spoils all to the scurvy Sea Captains who performed the same deeds, but instead became fugitives from Justice.
Most cryptocurrency advocates, including myself, will dislike this cold hard truth, however those who think about it logically and from an unbiased position would most likely agree with my deductions on some level. Bitcoin and cryptocurrency will never be massively adopted. At least not on the grand scale many think it will be. Do you want to know why? Its biggest strength is also its biggest weakness as far as mass adoption goes. And, it has nothing to do with criminals harboring illicit transactions in it, its volatility in value, or the ability to transact funds freely without third-party intervention. Forgetting anonymizing coins like zcash and monero - Decentralized, open source blockchain is too transparent for every day use, particularly for financial institutions, whose clientele may consist of "high-value targets". That, along with a myriad of other reasons - Like the overall complexity of blockchain technology, the self-management of security and storage for personal assets, coupled with the fact that your typical human can't keep their mouth shut - is the basis for why cryptocurrency will always be to finances as Linux is to computers. Not for the Everyman. And those of us who use it regularly often forget the little complexities and weird nuances of the cryptoworld we've become so used to. Remember, a big part of using cryptocurrency is about being secretive to a certain degree. Even when you're being transparent you're being secretive, you have to manage secret and public in one transaction. All it would take is one mistake, one politician to accidentally associate his Bitcoin address with an illegal operation he's running on the side, and it wouldn't even necessarily be intentional, and the chain analysis will connect those dots. Let me assure you that if crypto was massively adopted, there would be massive financial hysteria, there would be thousands upon thousands of press releases and bullshit cover-up situations that would arise, simply because, once you publicize a public wallet ID as being your own, the public can then associate all financial transactions that have occurred to and from that wallet. I mean think about it, there would be a TMZ Blockchain Division, what's Donald Trump doing with his money - what is JLo doing, what about Kim Kardashian - did the NFL really donate that money - let's take a look and see if they did - They would be ripping apart people's public addresses and associating them with other wallet IDs and other transactions that they probably had nothing to do with anyway.
I look at it on the same scale as this: When I was taking computer science classes years ago, many of the brighter kids eventually asked, "why is it that operating systems like Windows have an administrator account that has superuser privileges on the same level or even above your own account? You should be the superuser because it's your system. Right?" The answer to that would be of course, if you're intelligent enough handle that kind of task, and you are willing to accept any consequences that come along with it, such as your whole system being accidentally destroyed. The problem, without the sugar coating, a very high percentage of humans are not intelligent enough to do that or they just don't care about letting someone else manage it. Most can't handle administering their own lives let alone a complex computer system. Add machine learning and any sort of finances into that complex computing scenario, that's one of the greater supporting reasons as to why cryptocurrency most likely never becomes massively adopted. And that's just me keeping it 100. I like cryptocurrency, but global adoption probably shouldn't even be sought out because of the potential fallout that would ensue. Some people can't be sudo, and it has nothing to do with their intelligence level. They know how to be sudo, but their life as it stands for whatever reason doesn't allow it, it would be irresponsible for that person to even consider the undertaking of it. They have to balance their life appropriately and being a super user, or even having access to it, would be a detriment to them - maybe it causes too much exposure or maybe it takes up too much of their time, or another very valid reason. There are times when everyone needs an administrator with privileges above their own, and I say this as a person who is the super user of everything in his life, and lives of others. Being master of your domain, or even more so one of another's, is often not all it's cracked up to be, and it would be nice to have someone administrate that for me at times. Unfortunately it's hard to find people for that system, and if I know myself as well as I think I do, I'm going to keep on doing it DIY style.