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The total computing power now dedicated to securing the bitcoin blockchain has set yet another record.

According to data from mining services operator BTC.com, the average bitcoin mining hash rate over the last two weeks has reached71.43 quintillion hashes per second (EH/s), up from 64.49EH/s on July 23. The threshold was breached as bitcoin adjusted its mining difficultyat block height 586,672 on Monday 2:52 UTC – that is a 6.94EH/s, or10.78 percent jump since mid July.

Bitcoin mining difficulty is a measure of how hard it is to compete for mining rewards on bitcoin. Just how difficult the bitcoin software makes it to generate new blocks adjusts every 2,016 blocks – approximately every 14 days – to ensure the block production time remains about 10 minutes at the next cycle.

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Today, I was co-host of an online cryptocurrency symposium—taking questions from hundreds of visitors. A common question goes something like this:

Can Bitcoin be used in person—or
is it just for internet commerce?

Our panel had a moderator, and also an off-screen video director. As I cleared my throat in preparation to offer a response, a voice in my ear reminded me that it was not my turn. The director explained that another panelist would reply. It was a highly regarded analyst and educator in Australia. Realizing that that she was calling the shots, I deferred.

I was shocked as I listened to a far off colleague suggest that Bitcoin is not useful for in-person payments. I wonder how he explains this to the grocers, tailors, lawyers, theme parks and thousands of retailers who save millions of dollars each year by accepting bitcoin—all without risk of volatility and even if they demand to instantly convert sales revenue into Fiat currency.*

“Of course it can be used in person, Numb-nut!” (I kept the thought to myself. I know better than to criticize another speaker).

An in-person transaction, such as paying for a meal after consumption, is an ideal use scenario. It benefits everyone: The seller captures greater value and the buyer is unlikely to need bank-brokered arbitration. He only needs a receipt. He will never demand a 90-day return warranty, claim that he was shipped an empty box, nor complain about the amount charged.†

But, this isn’t about my clueless colleague. It is about the ease of using Bitcoin in person and the interesting stuff that happens in the background. Let’s look at a simple purchase scenario — and then we’ll dig in to marvel at the settlement process. This is a true story, told in 7 bullets. It occurred in the summer of 2015—just 5 years after the very first use of bitcoin to purchase anything (Bitcoin Pizza Day was May 22, 2010).

  • It’s 2 AM on a moonlit Sunday morning. Driving from Boston to New York I rehearse the Bitcoin presentation that I will deliver at a startup clinic hosted by LaGuardia Community College and the Cryptocurrency Standards Association. I pull off the last exit in Connecticut and find the Darien Diner. My meal costs $12.
  • As I take one last bite of midnight quiche, I realize that I forgot my wallet! No cash; no driver’s license. I have a smartphone, but it is brand new. I have not yet loaded it with credit cards. But, I do have access to my account passwords.
  • I scope my surroundings. My waiter is the only one on the main floor. He is also the cashier. Seeing no other customers or staff, I figure that the owner or cook is in the kitchen; probably the only other person on premises. I approach the cash register, hoping that the waiter will accept my apology—and trust that I will pay on my return trip in a few days. Before I launch into my poor-man’s excuse, I spot the placard shown at right. Bitcoin is among the diner’s accepted payment methods!
  • I ask the cashier how I can pay with Bitcoin. His response catches me off-guard: “I have no idea…They told me that you would know.” What?! Does this guy recognize me? Does he know that I am on my way to give a Bitcoin lecture? This seems very unlikely. Gradually, I understand what he means, and I know what to do…
  • I point my smartphone at the QR code (It’s taped to the cash register next to the words: “We accept Bitcoin”). In fact, this restaurant is fully on board. I am amazed to see that a display on the register offers a custom code that is encoded with the exact meal cost. That’s really cool! So, I shift my camera to that code.
  • Immediately, my wallet asks if I would like to add a tip. (It’s hosted by an online exchange, but an application wallet will also work). I add $3 and press SEND.
  • A thermal printer next to the till spits out a narrow receipt. At the very bottom, where it would typically say “Paid with MasterCard ending in −3862”, it says “Paid with Bitcoin”. The buzzing sound of that receipt printer tells the cashier that I am good to go. Good food in the tummy and a bill has been paid. Case closed; Return to car; Drive to New York.

What Really Happened?

In the few seconds between the authorization and the printed receipt, some fascinating things occurred around the world. Seriously Fascinating! This is almost magic — and it is transforming the way payments work, and—eventually—the way we view, understand and manage cash. ‡

  • When I clicked SEND, a limited subset of Bitcoin credentials was presented to a massively distributed, worldwide network of miners. In effect, I informed the bookkeepers that I wish to have $15 transferred to the restaurant’s public address.
  • Seconds later, the original credentials were voided (this solves the ‘double spend problem’) and a new transaction was added to public ledger that we call the blockchain. It now reflects my slightly reduced wealth.

But wait! It gets even more fascinating…

The “miners” that settled the transaction and provided new Bitcoin credentials needn’t have any awareness that they just facilitated payment for a meal at a diner in Darien Connecticut. From their perspective, these individuals and large server farms in Iceland, China, Israel, and South Africa — and in college dorms spread across the world — are engaged in a massively distributed gaming competition. They are competing for rewards based on solving a math problem.

As you review that last paragraph, imagine the elegance of the global network. Imagine the power, robust nature, and benefit that comes from it’s redundant and decentralized architecture. Imagine the ongoing incentive for bookkeepers to play a critical role in balancing a world-wide ledger. Imagine that authorities cannot shut down the network or even slow it down. Imagine the trust that individuals, businesses, NGOs, banks and governments can put in the monetary supply and the mechanisms of accounting. Imagine a world where this trust benefits everyone uniformly, fairly, and without susceptibility to graft or inflation.

Bitcoin and the blockchain, introduced together, are not minor, incremental contributions to economics, bookkeeping, trust, and commerce. They are overwhelmingly significant contributions to the future of human society and its institutions.

† You may have heard that bitcoin transactions are immutable. This is a simplification. The public ledger is immutable, but transactions are reversible, if terms are clear to both parties. Just as with Ethereum, smart contracts are built into the technology. So are hooks to centralized mediation, if that’s what the agreement calls for. Charge-backs, refunds, warranty demands and other arbitration are all possible. These features are built into Bitcoin, but rarely used in this early era.

Most Bitcoin transactions today are payments; they are not charges. Although they do not typically accommodate bank-brokered returns, rescission and charge-backs, these are all possible, and often without requiring an authority to broker the dispute.But these traditional safeties or mitigation must be agreed upon in advance. No longer does the seller have all the power, or the buyer need to run to a credit card processor to complain. Sales are either immutable or brokered by a 2-party contract.

This is not your grand-daddy’s payment mechanism. It is so much more evolved!

‡ In 2017, Bitcoin went through a period of intense growing pain. Transactions became so slow and costly, that in person transactions became impossible, especially for any amount less than $500. If you needed a transaction to complete in less than an hour, you would need to enlist in a bidding contest. A quick confirmation could cost upwards of $30 US.

The restaurant payment related above was an on-chain transaction. Today, transactions that use the Lightning Network overlay may occur within a private channel apart from the blockchain. But ultimately, every change in bitcoin ownership results in an individual or aggregated entry onto the blockchain.

Crisis in late 2017 and 2018

Sadly, in researching this article, I learned that the Darien Diner no longer accepts Bitcoin. Problems associated with transaction cost and delays in 2017~2018 discouraged acceptance by a great many retailers. No one eating a $12 meal would ever pay $30 in fees, and a cashier is not going to wait 2 hours to validate payment from a customer who has already eaten a meal and wants to hit the road.

That glitch sparked a terrible reversal of retail adoption. Even now (Q3 of 2019), retail penetration is sharply off its peak. We are barely beginning to recover the early adoption rate. Vendors lost faith, and many don’t yet realize that their POS investment can now be safely be reactivated. Lightning Network to the rescue!

he Next Crisis

Another crisis is looming, but it too will be solved.

Although the Bitcoin network is fast and inexpensive, the proof-of-work method used by miners to arrive at a distributed consensus consumes far too much power to scale. Mass adoption would consume more power than the world currently generates.

And here’s the kicker: The mining incentive ensures that any new, inexpensive energy that might be discovered in the future would be gobbled up by miners with no additional benefits to society (or even to the Bitcoin network). All the new, free (or cheap) power would be diverted away from homes, businesses, manufacturing and public works. The incentive for grabbing every cheap watt is very much like a cancerous growth.

Clearly, this is not sustainable. Bitcoin mining already uses more power than all of Argentina. But great minds are working on the problem and alternative methods of guaranteeing a fair, crowd-sourced accounting consensus are being tested, analyzed and debated. We will get through this complex problem, and hopefully—this time—without demoralizing a key factor in the tetrad: Consumers, developers, vendors & miners.

Philip Raymond co-chairs CRYPSA, hosts the Bitcoin Event and is keynote speaker at Cryptocurrency Conferences. He is a top writer at Quora.

An introduction to by Johannon Ben Zion candidate for President of the US Transhumanist Party.

US Transhumanist Party candidate for President, Johannon Ben Zion has a futurist new deal for America. This concept stoked my interest when I was listening to the debate between all of the US Transhumanist Party candidates. I wanted more information on this concept and Johannon Ben Zion was kind enough to forward this information to me.

What I am going to do is quote some content from his plan below. It will be short and condensed, to read more into the exact details of the plan you can download the PDF file at the end of the article. I am also going to list an interview that was done between Johannon Ben Zion and Debt Nation and the US Transhumanist Party Presidential Debate.

The primary Futurist New Deal mandate for blockchain technology is evoting. By casting votes as transactions, we can create a blockchain which keeps track of the tally of the votes. This way, everyone can agree on the final count because they can count the votes themselves, and because of the blockchain audit trail, they can verify that no votes were changed or removed, and no illegitimate votes were added.

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David Marcus has written a post intended to give “clarity” to the critics of Libra, the blockchain network Facebook is trying to seed.

First, to those who say the system is not really decentralized: “We totally get the point,” Marcus wrote in the July 3 post. “But it was important to start with trusted entities that could operate in a regulated environment and with the operational expertise required to ensure the integrity of the network in its foundational stage.”

He reiterated that “we’re committed to gradually transitioning to a permissionless state in the years to come,” and added that in the meantime, “I’d argue that one hundred geographically distributed, industry-diverse organizations is quite decentralized.” ( There are only 28 so far, however.)

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My mission is to drastically improve your life by helping you break bad habits, build and keep new healthy habits to make you the best version of yourself. I read the books and do all the research and share my findings with you!

This video is an interview of Dr. Aubrey de Grey @ SENS on July 17, 2019. My wife, Lauren Nally, was our camerawoman.

- Please consider a donation so I can continue to keep my YouTube ads off: My Bitcoin Cash (BCH) address: qr9gcfv92pzwfwa5hj9sqk3ptcnr5jss2g78n7w6f2 or https://www.paypal.me/BrentNally
- Please consider a donation to SENS: https://www.sens.org/

SHOW NOTES:

- Aubrey’s wikipedia: https://en.wikipedia.org/wiki/Aubrey_de_Grey
- SENS wikipedia: https://en.wikipedia.org/wiki/SENS_Research_Foundation
- like & follow SENS on Facebook: https://www.facebook.com/sensf/?ref=br_rs
- subscribe to Undoing Aging’s YouTube channel: https://www.youtube.com/channel/UCAwxbQhlE6qcTXmKcxkaCGA/videos
- follow Aubrey on Twitter: https://twitter.com/aubreydegrey
- follow SENS on Twitter: https://twitter.com/senstweet
- follow Aubrey on LinkedIn: https://www.linkedin.com/in/aubrey-de-grey-24260b/
- follow SENS on Instagram: https://www.instagram.com/sensresearchfoundation/
0:55 Type “Aubrey de Grey” into YouTube for lots of his lectures & interviews.
1:50 Update on the state of the anti-aging industry & explosion of private sector interest.
5:05 Intro for Aubrey
5:35 My May 30, 2019 interview with Sierra Sciences CEO Dr. Bill Andrews: https://www.youtube.com/watch?v=Tx9yG6iTROQ
6:25 diversity of messaging in anti-aging is increasing.
7:10 My July 10, 2019 interview with BioViva CEO Liz Parrish: https://www.youtube.com/watch?v=oBFTwGPaPr4
8:28 Aubrey shares his updated thoughts on the role of telomerase in cancer in humans.
12:00 Liz had here telomeres tested by SpectraCell Laboratories: https://www.spectracell.com/clinicians/products/telomere-testing/ & LifeLength: https://lifelength.com/
14:10 there has recently been more testing on humans in the field of the biology of aging.
15:44 It’s obvious to Aubrey & I that aging is a big problem but most people still don’t understand this.
18:40 profound difference between how scientists & technologists think.
22:11 Watch the documentary “The Immortalists” about Dr. Aubrey de Grey & Dr. Bill Andrews: https://www.theimmortalists.com/watch/?
22:58 updates on anti-aging investments & research projects.
30:01 stem cell therapy is intended to repair cell loss.
30:50: we have a massive funding problem to reverse human aging.
32:53 we must educate the public that aging is causing 100,000 deaths per day and funding biological age reversal research can change this.
36:52 Is human aging a disease?
44:10 FDA progress to treat age-related diseases/conditions.
47:38 World Health Organization ICD code progress to treat age-related diseases/conditions.
50:02 Trans-NIH Geroscience Interest Group (GSIG)
54:40 “triangular log jam” of funding with governments, scientists and public opinion.
56:30 Aubrey shares why SENS still exists.
1:00:38 Ethereum cryptocurrency founder Vitalik Buterin & other SENS donors.
1:01:55 Undoing Aging is a conference held every spring in Berlin, Germany.
1:04:53 July 2019 is Aubrey’s 2-year anniversary at AgeX as the VP of New Technology Discovery.
1:08:44 Jeff Bezos donated $100 million to Unity Biotechnology, Inc. (not Human Longevity Inc.) in 2018.
1:11:02 (Larry) Ellison Medical Foundation failure in reversing human aging.
1:14:15 Google co-founders creating Calico rather than investing in or donating to SENS
1:21: Aubrey shares details about his lifestyle as well as his recommendations for a healthy lifestyle.
1:24:25 Aubrey looks up to the longevity “foot soldiers“
1:28:42 do what you love as much as you can to avoid excess mental, physical and emotional stress.
1:30:40 Aubrey is following all longevity therapies to determine their safety & effectiveness.
1:32:20 my stem cells story & Aubrey’s feedback.
1:34:58 EmCell in Kyiv, Ukraine is the only company doing fetal stem cells therapy.
1:39:20 exosomes
1:41:00 I’ve had no reply from Ambrosia founder Jesse Karmazin since October 2018.
1:42:51 My March 26, 2019 interview with Dr. Ed Park at Recharge Biomedical: https://www.youtube.com/watch?v=xHgfYKsH0uw&list=UUCwpkla04tVxHJUds2J2aqA&index=6
1:44:31 NAD+
1:47:39 gene therapy
1:53:37 please network on the internet & in person with other longevity enthusiasts to help grow this movement faster.
1:58:48 mitochondria
2:00:48 long lived animals
2:01:49 consider a donation to SENS

- Forever Labs 1 year free cryogenic storage discount code ($250 value): BN801
- Forever Labs website: https://www.foreverlabs.com

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This post is structured as a question-&-answer. That’s because it was originally an answer at Quora, a Q&A site at which I am a Bitcoin columnist.

What is a ‘Paper Wallet’

A paper wallet is the ultimate offline wallet. It simply means that the private address to your crypto wallet is printed on paper — either as a string of characters, a QR code, or a series of seed recovery words.

If you destroy any electronic copy of your original wallet (e.g. the private keys that give you access to your wealth), then hiding this piece of paper is very similar to hiding a bar of gold. The only way that someone can steal it or know the amount it represents is to get their eyes and hands on something physical. They would need to know that you tucked it into your mattress or behind a secret panel of your cellar wall.

In my opinion, a paper wallet, though secure, presents a big risk to the owner—even bigger than the potential for a hardware wallet to be hacked. We’ll get to this later.

Example of a Paper Wallet

The image above is a paper wallet printed onto a card [click to enlarge]. There are web sites that will help you print one with a new or existing wallet address. One popular site is BitAddress. [Warning!]† After printing and storing the paper wallet in a place that you believe is secure, that you will not forget—and that your family can get to some day in the future)—delete all electronic copies of your original address (i.e. if you did not create a completely new wallet in the process).

More about Paper Wallets

Like other wallets (a software app, or a dedicated hardware device), your wallet contains private keys that access your wealth on the blockchain. But in the case of a paper wallet, it is made private and secure by hiding this slip of paper where no one can ever see it or peek at it online. Think of it as if you are hiding a valuable diamond.

A paper wallet cannot be hacked, unless it is within range of a camera. But the diamond analogy breaks down, because a paper wallet has other risks than hacking…

It can be lost, damaged in a flood or fire or chewed by termites or your dog. More likely, it can be forgotten for years. When your heirs finally discover it under the mattress or taped to the back of a painting, they are unlikely to recognize its purpose and simply throw it out.

Hosted Wallet: Complete Opposite of Paper Wallet

You didn’t ask for the other extreme wallet scenario. But this seems like a good time to discuss it.

When it comes to security –vs- convenience & recovery, an exchange-hosted wallet is at the other end of the spectrum. With this type of wallet, you do not control your private keys. In fact, your crypto isn’t even in a wallet dedicated to you. Instead, it is aggregated with assets of all other clients. You are trusting the exchange to track your stake via a traditional account relationship. When you spend or receive Bitcoin (or other cryptocurrency), the transaction occurs withing the exchange. It is not transmitted directly to a blockchain or Lightning Network.

Advantages of an exchange hosted wallet:

  1. A reputable, hosted exchange (there are very few)‡ implements and follows rigorous backup, security and disaster practices. These safety practices are probably more diligent, standardized and adhered to than whatever you would do with a software, hardware or paper wallet.
  2. A reputable, hosted exchange maintains your account information and instructions in their records and acts on these instructions. As with a traditional bank or broker, they pass wealth to your heirs or executor, if you provide the beneficiaries and instructions in your account profile.

With a personal wallet under your control, it is more likely that your relatives will not know about your wallet, lose it, or fail to distribute assets as you intended. This will change in the future, as multisig becomes standardized and easier for end-users to understand and use. But for now, a traditional custodian has an edge in transmitting wealth from one generation to the next.

Disadvantages of an exchange hosted wallet:

  1. Your money could be completely lost if the exchange does not practice very good security practices, is dishonest or becomes insolvent. (It happened with more than half of the exchanges during the first 5 years after Bitcoin was unveiled!). It is less likely today, but only if you choose your exchange carefully.‡
  2. With Bitcoin and most cryptocurrencies, transactions are never anonymous, nor even very private. That’s a myth. But with an exchange hosted wallet, your wealth and activities are even more exposed to outside scrutiny. That’s because reputable hosts are quick to comply with subpoenas, court orders, tax authorities and even local police investigations. They want to be seen as safe. To project this image, they are proactively compliant with oversight and proposed regulations.
  3. Your money can be frozen or seized by the exchange (for whatever policies they deem appropriate) or from authorities outside the exchange. Often, the reasons make no sense to individual clients affected. This happened to me very recently!
  4. Large computer based servers experience technical glitches—which often coincide with your most urgent need to access funds.

† Extreme Caution Recommended

BitAddress has an excellent reputation and has never been the focus of suspicion. Their source code is written in a popular script and is short enough to enable scrutiny by many developers and analysts. Additionally, the creation of your wallet and printout can be performed completely offline (no internet connection). You can further enhance safety by performing the wallet creation and printout from a PC that will never be connected to the internet. (Yes! It is that important to use paranoid practices to avoid exposure of your private keys).

Despite the quality reputation and transparency, I do not currently recommend using BitAddress to create a paper wallet.

  1. At the time of publishing, BitAddress has a problem with their web security certificate. This makes it possible for your web traffic to be hijacked by a DNS spoof. (This Blog does not have a security certificate at all, but you are not using it to store or create confidential information).
  2. Unnecessary risk is introduced by merging the process of creating a new wallet with conversion into a physical printout. Look for a tool that is completely off-line and that enables you to create a QR code or seed words for a wallet address that you already own.

Once BitAddress fixes the problem with security, the following process will protect your private keys from interlopers:

  • Go to bitaddress.org
  • Switch the internet off
  • Save the HTML file in a USD device
  • Restart the computer with a bootable Linux Live CD
  • Make sure that you are offline and open the HTML file
  • Follow the rest on bitaddress.org to create a paper wallet

If you download another tool to create a paper wallet, search for one that is open source and vetted by thousands of developers, users and armchair detectives. Choose one that is hosted by SourceForge or GitHub and carefully read user forums and reviews.

‡ Why are their few reputable cryptocurrency exchanges?

Regulations pertaining to cryptocurrency exchanges are not yet uniform, nor even widely understood. Additionally, there is no Federal account insurance for your hosted wallet. (Currently, the market is too volatile and risky for traditional underwriters to step up).

But, a well-capitalized exchange with high-profile investors is likely to adhere to rigorous security practices and unscheduled audits with public transparency. These reputable exchanges also work hard to comply with federal and regional regulators, and they comply with money transmitter practices, such as KYC, AML and RICO.

In my opinion, very few exchanges meet these rigorous standards, especially in this early era—which is often compared to the Wild West. Two very reputable exchanges are Coinbase (San Francisco) and Bitstamp (Founded in Slovenia and incorporated in the UK; Now, they are based in Luxembourg).

These big, reputable services mitigate the risk of hacking and theft by keeping most client assets in a ‘cold storage vault’ (off line and powered down). Your wealth is only attached to the internet when requested and in the quantity that you need. The rest is never exposed. Your online purchase or transaction is made after you have received email and text messages about the status of your coins.

Philip Raymond co-chairs CRYPSA, hosts the Bitcoin Event and is keynote speaker at Cryptocurrency Conferences. He is a top writer at Quora.

This afternoon, an automated bot at Quora suggested that I answer a reader question. Quora is essentially an “Ask the expert” web site. It is the world’s largest, cataloged and indexed Q&A repository.

This is the question I was asked to answer:

Some pundits believe Bitcoin is a fad, while others seem to feel that it is better than sliced bread. I like sliced bread.* Is Bitcoin really that cool? —Or is it just a lot of Geeky hype?

One other columnist answered before me. Normally, I pass on an invitation, if a question has already been answered. But in this case, the individual answering the question has yet to see the light. He has wandered into the Church of the Blockchain, but he just didn’t realize that the man sweeping the floor is the prophet.

Here then is my answer, regarding Bitcoin, the blockchain and sliced bread…

I respectfully disagree with Jim Euclid. He answered this question too. Perhaps it is arrogant of me to state with confidence that he will change his mind, if he is still around in another 30 or 40 years. So will everyone reading this.

Bitcoin and the blockchain were introduced together in a white paper by a quasi-anonymous developer in October 2008. He or they used a pseudonym, but communicated with a broad group of developers before and after unveiling the solution to an age old problem of math, logistics and cryptography.

Just over 1 year later, Bitcoin began moving between individual owners. And then it began to re-write the history of economics, bookkeeping, consensus, trust and the very democracy that is so precious to us. It is changing what we understand about so many things. But its true contributions have barely even begun.

Bitcoin is as ‘cool’ an invention as there can be. Like the steam engine, vacuum tube, automobile, television and the internet, it is radically transformative. Each of these inventions has (or will) contribute enormously to human progress and happiness.

The problem that Satoshi solved goes back to Aristotle and has profound social implications for the future of humanity. There is no poetic license or potential for overstating the importance of both Bitcoin and the blockchain. It will impact your life—probably in very positive ways—with a punch that matches the rise of agriculture, indoor plumbing or airline travel.

Sorry, Jim. I respect your opinion, but I see the future a bit more clearly than you. The internet is a vehicle. It is certainly important. But it is only the highway. Bitcoin is the marvel that the internet’s instant, inexpensive and ubiquitous communication was meant to spawn.

I have always felt pride over the fact that I was alive when man first landed on the moon. I was a child and I had nothing to do with that achievement—but somehow, I am gratified that this event intersected with my life.

Unlike the moon landing, Bitcoin has no Jules Verne or cave paintings from past generations yearning to conquer something that is tangible. We have only Aristotle’s insight that money was not yet perfect—and his recognition that issues of democracy and governance seem to have insurmountable impediments. But the problems that Bitcoin and the blockchain address are just as real as the moon overhead. And the solutions they will spawn are even more relevant to our civilization.

I have even more pride that I have witnessed the birth of decentralized, permissionless, distributed consensus—and specifically Bitcoin. It will impact my health, wealth and happiness even more than everything that NASA and space technology have spawned.

Am I smug that I recognized the importance of Bitcoin and the blockchain just 4 months after its unveiling? You bet I am! And even if Jim doesn’t recognize it yet, someday I will rub this fact in his face.

(Kidding…but it is personally comforting to be on the right side of history!)

* Note: In America, the expression “sliced bread” refers to something that is really clever, desirable and coveted. It is often paired with the word “since” like this: That new iPhone is the best thing since sliced bread.

Philip Raymond co-chairs CRYPSA, hosts the Bitcoin Event and is keynote speaker at Cryptocurrency Conferences. He is a top writer at Quora.

Here is another economics/policy question that I was asked to address at Quora. It provides great fodder for a quick Lifeboat economics review.

The US used quantitative easing to deal with one monetary crisis, and a bailout of the automotive and banking industry to deal with another. If nations, economies or individuals begin to embrace a decentralized currency, they will inevitably shift away from government issued money. Won’t this hinder a nation’s ability to intervene in a crisis?

Answering this question goes to the very heart of the ethics and politics of cryptocurrency.

Yes. Without centralized control over monetary policy, government options for intervention in a money crisis would be severely limited. But this fact may lead to a false impression…

First, most money crises begin with government, and so there are likely to be far fewer monetary emergencies.

Here’s how the options would be limited:

  • Governments would have fewer ways to manipulate a public resource. They will still have the ability to budget, tax, borrow, build infrastructure and even wage war. But…
  • Governments could no longer amass debts that outstrip their ability to be accountable. That’s because they can no longer covertly tax via rampant printing of money.
  • They could not “raise the debt ceiling” without demonstrating fiscal responsibility, because they no longer control what everyone uses as money.
  • Government spending (and intervention, such as quantitative easing) would have to be balanced by revenue. Borrowing would be limited to creditors who truly believe in their will and ability to repay debt.

All of these “limitations” are good things—even for the governments and banks involved. It only seems limiting, because our understanding of what is money is tainted by millennia of authoritarian systems.

A capped, open source, transparent, traceable, immutable, decentralized, distributed and permissionless money supply is both fair and more robust than Fiat paper, promises or credit.

Let’s explore that last bullet, above. The point is subtle—yet, it is the key to answering your question…

Every individual, household, business, state and NGO must balance its books. If one cannot cover bills, they must find a creditor who believes in their ability to get back to fiscal health. Even nations are eventually forced to balance their books or seek a bail-out from neighbors.

But, this is not the case for the United States. We have had an ability whitewash our largess and declining industrial productivity by printing more money. How has this been possible while retaining a strong dollar?

The US dollar has been the world’s reserve currency for 47 years. This development was one of the most clever, yet potentially damaging developments of the post war order. It led other nations and consumers to treat it like gold (even though the link to any underlying asset or promise was severed by Richard Nixon in 1972).

Now that other nations are shifting this special status away from the US, we are gradually becoming just as susceptible to a house-of-cards collapse as Venezuela, Argentina, Zimbabwe, or Germany between the wars. Our massive consumer market cannot protect us. Eventually, we must ship the fruit of our sweat and intellectual bounty to serve others. After all, for more than a half century, we have been giving them pieces of paper (dollars or treasury bonds) for their TVs, underwear, sneakers, toys and sheet rock.

This unbalanced trade must be reversed. Building walls at the boarder and stiff tariffs are desperate acts that fail to recognize cause or containment. They are certainly not the way to restore a robust economy. There must be a better way for nations to get their houses in order. Fortunately, there is.

A distributed currency built on math, trust and transparency—rather than the integrity of transient elected officials from one nation is far less susceptible to manipulation, inflation or any form of shock. It won’t solve all problems immediately, be it will prevent us from getting further mired in a debt that blows up like a balloon.

The decoupling of a money supply from government will yield benefits that are difficult to imagine today. Money doesn’t need authoritarian oversight like airline safety. The situation is more analogous to the deregulation of telephone and package delivery services. Without those blockbuster decisions of the 1980s, we would not have Smartphones or the internet today.

Philip Raymond co-chairs CRYPSA, hosts the Bitcoin Event and is keynote speaker at Cryptocurrency Conferences. He is a top writer at Quora.