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The Powerful Influence of Cryptocurrencies on the World Stage

La influencia de las criptomonedas en el escenario político internacional

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Por: Salvador Suniaga

The latest regional elections in Venezuela remind us once again, in spite of the very democratic analysts whose pearly souls and not oblique intentions we presuppose, that the solution to the crisis is unlikely to emerge from negotiation tables, or from a popular demonstration or saber-rattling. However, the Deus Ex Machina that many are waiting for is not coming (and will not come) from the U.S. Marines, but is silently appearing in the personal finances of an increasingly significant number of Venezuelans. Namely, cryptocurrencies.

Marx was right at one thing: whoever controls the means of production will control the political structure and cultural superstructure of society. This is well known to socialist governments, which once in power are quick to expropriate. Or it is enough to remember the late Aristobulo Isturiz, one of the main political leaders of Chavismo, explaining with no effort that the control of the exchange in Venezuela is a power-grabbing move.

But neither Marxism-Leninism and let alone Chavismo could anticipate the advent of decentralized digital money. With this evolution of fiat money, no government can expropriate virtual wallets, nor control the prices of goods and services. This empowerment—which even if temporary, is still true—makes it possible to buy food in dollars so as not to depend on the government; to pay for a ridiculously expensive passport; to manage the health of loved ones at home; to save in hard currency; to send remittances without intermediaries and to pay for postgraduate studies and other life projects. It is a technology that, at least in this order of ideas, liberates societies.

The impact of cryptocurrencies is indisputable and has aroused contrasting reactions in governments. In the small group of those who resist, countries such as India, China, Indonesia and Bolivia have banned them. On the other hand, the debate on their acceptance in the Muslim community is still ongoing, as the speculative and immaterial nature of cryptocurrencies would make them contrary to the principles of Islam.

Meanwhile, El Salvador has not only been the first country to adopt bitcoin as legal tender but is also promoting the development of a Bitcoin City, financed by this currency and whose energy to mine it in servers would be provided by the geothermal energy of the Conchagua volcano. On a more modest note, the mayors of Miami and New York have requested to earn their salaries in cryptos; while the Venezuelan regime itself has set up a National Superintendence of Crypto-assets and Related Activities.

At this moment, Binance is the main cryptocurrency exchange platform in the world. Its portfolio of solutions and services is very complete and possibly overwhelming for novice investors. There is also CryptoMarket, focused on the Latin American market, with an equally robust platform but simpler to digest, and with a social impact that is closer to us. This can be assured by the Haitians in Chile who send remittances to their families through it, the Argentinians who thus avoid the currency exchange trap in their country, and the Venezuelans who, in addition to the above, suffer from the expiration of their identity documents and because of this are rejected by other platforms.

Cubans living in other countries have also found a way to send money to their families on the island with the help of these authentic “digital machines”, even at pedaling speed and through various tricks. It is important to emphasize the tricks because they are the essence of the machines. The function of the machine is to circumvent nature, to outwit the gods. Especially the totalitarian gods. The archetype is represented by Odysseus, challenger of Poseidon, who devised the Trojan Horse and who, not by coincidence, was called the polymechanikos, that is, “the fecund in tricks.”

Conceiving cryptocurrency platforms as digital machines are appropriate to identify their advantages and dangers. It so happens that, although they manifest the potential of a liberating technology, the distrust they generate is greater in view of their different layers of immateriality. We do not know how they work inside and they trade with currencies that we can neither see nor touch. We only know their inputs and outputs, which we take advantage of as best we can.

Flusser disassembled digital machines at the dawn of the 1980s. He did not, however, call them ‘machines’, but ‘apparatuses’, because unlike the former, apparatuses are marked by automatism (hence the current prominence of programming, of software) and by the capacity to reinterpret the world. They do not materially transform reality but re-signify it. Information replaces industrial work. They lead us to a more abstract sphere of new relative and gaseous values.

Since we do not know the inner workings of the devices, and when they do not depend on any physical location, they are for societies a sort of black box. And it is precisely this that gives the developer of the apparatus power. Hence, its political potential. At the same time, the technical characteristics of the device, as with any tool, derive its liberating potential. And from its digital-financial character, within everyone’s reach, derives its citizen potential.

Thus, cryptocurrencies and their platforms, as technical digital-financial, ergo political, devices, are difficult to prohibit, not to refute ideologically from the socialist platform. Because, if we assume that Marx is right twice, and as he wrote in the New Rhenish Gazette: “to refuse to pay taxes is the duty of every citizen.”

That is why the totalitarianism that oppresses from the economic point of view has no choice but to join the new post-industrial reality of intangible values. In this regard, the Venezuelan regime has converted a poster of the commemoration of the Battle of Carabobo and the Guinness Record certificate for the largest orchestra in the world into NFT, not to mention its incursion into the Petro. Banks will also have to adapt.

The advantages are clear, but let us also warn of the dangers, which are several and deserve another moment to be analyzed.

For the time being, beyond state retaliation and the usual swindlers, the greatest danger of all is to pretend that we have already found in cryptocurrencies a definitive way of not working, of circumventing nature and history.

Everything has already been said by the Greeks. Let’s go back to Odysseus to review what the outcome of all this will be. Our machines, be they physical or digital, our wiles, will only labyrinthically slow down our return home. In the end, as is already sentenced, we will continue to earn our bread by the sweat of our brow. Or as some classical economists project, the long-term price of bitcoin will equal zero.

However, transient phenomena are just as exploitable as stationary ones. This holds true in physics as well as in economics. There is a reason why coffee is drunk before it gets cold.

Salvador Suniaga is an engineer and consultant to the Latin American industrial sector. He specializes in numerical simulations and qualitative research, with an interest in techno-anthropology. Winner of the international award SolidWorks Elite Application Engineer. He is currently Technical Director at SolidIndustry.

Salvador Suniaga