A technology that permanently separates money from the state has been developed for the first time in human history. The separation of money and state may represent the biggest cultural and political revolution since the division of church and state in terms of how we value things and how much government should be involved in our financial lives.
A blockchain is a decentralised ledger that serves as the foundation for the cryptocurrency bitcoin. Thousands of nodes all across the world examine Bitcoin’s ledger every ten minutes, unlike the Federal Reserve, which has never been audited.Governments will be forced to impose direct taxes on their population in the absence of the ability to produce money out of thin air.
Bitcoin cannot be produced on demand by a centralised authority, limiting governments’ capacity to spend at will. The government-created boom-bust cycle, ongoing inflation, and the ability to finance wars will be a thing of the past once mankind advances to a Bitcoin standard, which may seem idealistic.
Even when the revenue is anticipated to be utilised for domestic goods like public health or education, raising taxes is often a difficult sell. However, it will be very unlikely for the general populace to agree to tax hikes for any conflict that is not simply defensive. For all we know, if we had already adopted the Bitcoin standard, America’s recent Middle Eastern adventures would not have happened.
People will be hesitant to accept any currency that isn’t bitcoin, which will drastically reduce the number of people who use central banks. Additionally, even if some accept the second-layer currency of the central banks, those individuals will have a hard time finding others who will take it.
The boom-bust cycle will be significantly reduced by a Bitcoin standard. Bitcoin will put restrictions on central banks, assuming they still exist, preventing them from making easy loans. First off, they could only invent a second-layer currency; they couldn’t construct bitcoin itself.
In other words, on a Bitcoin standard, printing money and dispersing it is not a viable business strategy.
The (gradual) elimination of inflation is the final aspect of a Bitcoin standard. The predetermined supply plan for bitcoin ensures that there will be 21 million coins in circulation before the supply starts to decline. No more bitcoin will ever be mined after that. Prices for products and services will decrease over time if humanity continues to innovate.
In other words, as more wealth is produced by humans, the value of Bitcoin will continue to increase. Humanity now has access to a technology that, despite efforts by governments, cannot be outlawed because of Bitcoin. In 2008, when Bitcoin was created, this would have seemed audacious, but it is now far too late to stop the decentralised network. As the leading provider of network hash power at the time, China once attempted to outlaw bitcoin mining there. As opposed to that, it demonstrated how robust bitcoin is. All throughout the world, especially on China’s illegal market, mining is thriving.Around the world, mining is thriving, especially in China’s underground economy.Now, Bitcoin has strong allies as well. Bitcoin is now accepted as currency in El Salvador and the Central African Republic. Cryptocurrency proponents in North America include Jared Polis, Pierre Poilievre, and Cynthia Lummis.
Even the early 2022 Canadian trucker protests and the continuing Ukrainian situation were significantly influenced by bitcoin. As the expression goes, more and more people will likely get “orange-pilled,” alluding to the orange sign for bitcoin. It is challenging to persuade individuals that inflation is beneficial to them and that a deflationary asset is harmful to them, despite the fact that the State may not appreciate losing its monopolistic control over the money supply. Therefore, bitcoin will progressively pressure the State to relinquish its control over money due to citizens’ simple self-interest.
While the separation of Church and State has always been imperfectly carried out, there will be a genuine, complete, and long-lasting separation of money and State.
- Bitcoin is Dissolving State and Money
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