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Surprisingly, a few weeks ago, it became official that one of those many modern states to which we are today, in one way or another, subordinated, had opted to promote a cryptocurrency not managed by any state Central Bank. We are referring to the case of El Salvador.
On June 8, the Legislative Assembly of El Salvador approved, with an absolute majority, a series of legal provisions known as the Bitcoin Law. This legislation contemplates Satoshi Nakamoto’s cryptocurrency as a legal tender unit of exchange.
This measure may be exciting, at least for those who, leaving moral considerations aside, are interested and curious about cryptocurrencies because they can be considered as a mere technological advance, just like a robot or a last generation cell phone.
However, from a socially conscious point of view, although there are reasons to be happy, we must read the fine print. In other words: we have to be careful and cautious, as I will explain below, with the bill in question, because not all that glitters is gold.
The Bitcoin Law completely ignores the essence of the network of networks and blockchains.
One not only has to appreciate the distributed, dispersed and decentralized nature of the Internet as well as blockchain in its technological manifestations (servers, clusters, VPNs, no token controller node, multitude of web portals, among others).
This non-centralized spirit has repercussions such as, for example, challenges to censorship, access to a huge amount of goods and services, and the wider spread of knowledge. It is therefore obvious to think that in one way or another it favors greater freedom to save, spend/consume and invest.
However, this legislation do not seem to respect this.
For example, the “state protectionism” when it comes to supporting savers, the opening to limitations of converters and its prohibition as a currency for accounting purposes (although perhaps it is already too much of a positivist recognition).
At the same time, it makes it compulsory to accept by force the payment in Bitcoin by any Salvadoran individual agent who considers it, and at the same time it is required to establish systems of automatic convertibility to the US dollar, in case any creditor (perhaps foreign) distrusts this decentralized cryptocurrency.
Therefore, if the philosophy of Bitcoin and other cryptos was to break with the artificial chains that have been imposed on us, it is not very coherent, at least as far as we can tell, to sell the idea that this currency is only legitimate because the State says so, being free to use it only until this entity no longer deems it appropriate.
The blockchain and the “anaconda method”.
Anacondas are an example of a dangerous reptile, even if they act somewhat sleazy to begin with. There are cases in which they appear to be very harmless, just like pythons, getting too close to their owners, in order to prepare their digestive system to digest them.
Using this analogy, this situation does not mean we should be afraid of the end of oppressions (another thing is that one puts oneself in the dictator’s shoes in order to emulate him, to admire him, to follow his praxis), since I believe that an excessive trust in cryptocurrencies, on the part of the ex-leftist Bukele, could turn against him.
To begin with, as the legislation acknowledges, at least, the relationship between the price of the US dollar and the Bitcoin will be determined in a spontaneously orderly manner. That is, as determined, randomly, freely and variably by the market, according to the motives of the diversity of subjective values thar rule the market.
Blockchains are decentralized solutions in themselves, which need not be applied in the concept of Bitcoin. In fact, let us recall that in territories such as the United Arab Emirates they are already working on applying blockchain solutions in their process of digitization of the state administration.
One is not going to develop here a scientific-technological research work, but to dare to anticipate scenarios, in relation to the base descriptive points (technical conception). It is not a question of conspiring wildly, nor of elaborating a science-fiction narrative.
If we end up entering a dynamic where people choose to invest in different cryptocurrencies (following the currency exchange trick) and applications and IT solutions emerge that, in one way or another, allow for more decentralized organization systems within which there would be certain formulas of the collaborative economy or, especially, the so-called “smart contracts”, then political interventionism in El Salvador would have to be less.
Having said this, it is enough to take advantage, to put it another way, of this accumulation of recent circumstances to remember that the blockchain can be very revolutionary (in a positive sense of the word, which would have nothing to do with the Plinian conception) and promote the strength of society in the face of the State and the free market.
Ángel Manuel García Carmona es ingeniero de software, máster en Big Data Analyst, columnista y tradicionalista libertario // Ángel Manuel García Carmona is a software engineer, master in Big Data Analyst, columnist and libertarian traditionalist.