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Right now, the terminology embraced in the world of cryptocurrency places technology in opposition to states. Who in the liberal West, for example, would support "censorship"?
But the "resistance to censorship" in the world of cryptocurrencies essentially means opposition to the financial transaction based on cryptocurrency, including the action of law enforcement or regulatory authorities.
This understanding, which sees central banks, supervision and regulation as a form of oppression, offers a clue to one of the potential functions of cryptocurrency: its ability to destroy the role of the state in finance.
There is a rush to exploit the value of cryptocurrency. People want to make a fortune. Start-ups want to grow. Financial services companies do not want to be left behind.
Yaya J. Fanusie is a senior fellow at the Foundation for the Defense of Democracies and focuses on cyber, blockchain and illicit finance.Credit:FDD
But there are others in this space too. National States. And some of these nation states are attracted to technology not simply to innovate their economies but potentially as a way to question Western power in the financial and economic sphere.
Venezuela has recently instituted an oil cryptocurrency with the idea of circumventing western sanctions. The technology was designed and implemented by Russian engineers, which should not be surprising.
Russian President Vladimir Putin did not hide his desire to "fight the excessive domination of a limited number of reserve currencies", in particular through the grouping of the BRICs (the main emerging national economies of Brazil, Russia, India, China and South Africa).
"We are seeing Russia and China put in place some parts of what would be needed to develop an alternative system of transferring bank funds through digital currency / blockchain technology," said Yaya Fanusie, director of analysis. for the Foundation for the Defense of Democracies "Center on penalties and illicit finance in Washington.
"We can not really stop him from piloting blockchain technology projects, so it's like we're seeing slow steps."
A banner showing coins of various cryptocurrencies is displayed inside the cryptocurrency mine and school at the Ministry of Youth and Sports in Caracas, Venezuela.Credit:Carlos Becerra
To understand what effect this could have, it means that economic sanctions used against terrorists, rogue states like North Korea and war criminals would lose their effectiveness. In turn, authoritarian kleptocracies would be increasingly encouraged and capable of leading events.
For cryptocurrency to be the basis of an alt-global trading system, a key issue will be the degree to which the currency is decentralized, or not controlled by a single authority, Fanusie says.
Some cryptocurrency activists believe that a decentralized currency will free people from the oppressive effects of monetary policy, inflation, regulation and central bank supervision.
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Others repeat the rhetoric but show a willingness to accept regulatory supervision.
While cryptocurrencies develop and mature, there is a tendency for them to cooperate with government agencies charged with fighting finance or corruption of terrorism, while preserving the benefits of a digital currency.
A currency exchange, Shapeshift, founded in 2014, had previously "struggled" to request private data from users. Last year, however, announced the information in order to comply with the anti-money laundering requirements by governments.
The move comes when the US Department of Justice issues incriminations from hackers who use cryptocurrency to fund harmful activities or recycle funds.
Within the cryptic world, decentralization purists form a smaller subset of activists and entrepreneurs, but, says Fanusie, "they are totally engaged in the purist vision and in all the perturbations and revolutions it implies.
Hackers use cryptocurrencies to recycle funds.Credit:Reuters
"They will not give in. These are people who see the banks and the system" as evil and do not intend to compromise themselves, they are happy to concentrate on the "underground". "
When considering that cryptocurrency, like online propaganda, is at a certain level, only information on the Internet network, an immediate question is how an emerging underground cryptocurrency in the West would interact with a global financial system based on cryptocurrency .
For countries like China, Russia, or Iran to use blockchain or cryptocurrency to create a parallel global digital currency system, many things should be put in place, Fanusie says.
On the one hand, they would "need a faster, faster and safer alternative to SWIFT" (the global interbank financial telecommunications company, the current global banking communication system).
From the other side, there should be a major crisis that triggers the collapse of the dollar. Something along the lines of the global financial crisis of 2008 – or worse.
While these events did not occur, the intentions of the authoritarians are visible.
"I do not want to be an alarmist, but I want to emphasize the long-term strategy that Russia, China and Iran seem to want to implement," Fanusie said.
"I do not want us [in the West] be blinded. "
The trend lines are there. Russian entities are investing heavily in cryptocurrency and blockchain, the technology on which it is based.
One fifth of the first 50 block-blocks of start-ups with funds was founded by Russians or had Russian partners, said angel investor Elena Masolova Forbes.
The ICO watchlist calculates that Russia-based cryptocurrencies have more than $ 1 billion in initial coin offerings: the launch of new digital currencies, most of the countries that track.
Iran is developing its own cryptocurrency and has think tanks for doing research on technology.
There are also other overlaps with authoritarians. Cryptocurrency is the preferred currency of the extreme right-wing and far-right groups that agitate against liberal societies in the West and make common cause with Russia.
Robert Mueller discovered that Russian hackers used cryptocurrencies to move funds.Credit:J. SCOTT APPLEWHITE
One of the most interesting dimensions is the ideology of cryptocurrency purists.
The main premise for cryptocurrency purists, which constitute a small but vocal part of the global community, is that a stateless currency will free people from the coercive power of central banks and the states that support them.
In this way, cryptocurrencies generate their own question by promoting an ideology that presents itself as a response to the evils of modern economics.
Like those who embrace the ideology of cryptography, there is the belief that technology alone can engineer resistance to the evil forces of government and banks.
Crypto-currencies are the favorites of the alt-right. Here a white nationalist at an event in Charlottesville, Virginia in 2017.
For activists and entrepreneurs of that persuasion, the belief is that all "government" is "tyranny".
As Virginia Golby of Virginia Commonwealth University wrote, Bitcoin itself is "software like right-wing extremism".
"Bitcoin and blockchain technology on which it rests fulfill needs that make sense only in the context of right-wing politics," Golumbia writes.
The cryptocurrency ideology paints the world today "as if it were an ungoverned" tyranny "that invites a" system of conspiratorial beliefs "that dismisses the existing currency as" fiat "(or declared by the state).
Likewise, the limiting government is presented as an undisputed good. It is hard to find a Bitcoin story that admits the role of the nation state in money, Golumbia writes.
Being marginal ideas, they are at risk of being co-opted or manipulated from abroad, as has been seen in radical politics.
Alternative news and conspiracy theories connected through social media can be reliably counted to promote misinformation about current events. Their effect is to fracture public unity and further polarize the opinion on particular issues such as immigration, terrorism and the economy.
In many cases, the marital conspiracy theory anticipates anti-Western suspicions also held by authoritarian powers. Think about Zero Hedgeor Alex Jones & # 39; Infowars, to cite two examples.
Despite the promises of "freedom", the practical use of cryptocurrencies seems to be to bypass Western banking systems and networks designed to maintain control over the financing and corruption of terrorism.
Cryptocurrency is the currency used by Russian hackers. The Muslim allegations on Russian citizens involved in interfering in the 2016 elections used cryptocurrency to move funds around to pay bills and IT equipment for their efforts.
Non-state anti-Western groups such as WikiLeaks were one of the first advocates of technology. Edward Snowden has also promoted cryptocurrency. Organizations formed in support of the former Russian National Security Agency contractor also accept cryptocurrency.
"It is not a conspiracy theory to think that Bitcoin and other cryptocurrencies can circumvent SWIFT and other financial controls," Golumbia said via email.
"It seems to be true that Russia is largely dominated by organized crime in recent days and that organized crime is the most obvious use case for cryptocurrency as a method of payment / transfer".
Edward Snowden was a supporter of cryptocurrency.Credit:AP
The decentralized currency makes it more difficult to track information on cryptocurrency, although not impossible. Nonetheless, like the propaganda on social media that has captured Western nations, Western governments are not ready to trace wealth flows into the environment without borders of the Internet.
Despite these warning signs, simply ignoring the power of cryptocurrencies is not even an option either.
This is a point that Fanusie is quick to do.
"The best protection" against the authoritarians on the blockchain "would be that the free nations invested in the crypto / blockchain space so that this nascent technology, like the Internet, develops in association with freedom", wrote in Forbes.
This is because the evolution of digital currencies is also a natural progression in the wider digital break that is reshaping the global economy. Digital currencies can actually create new models of economic incentives – for example, they can revolutionize payments in geographically diverse and under-served markets, such as in Africa and, to be fair, even in Russia.
A bitcoin trading page is displayed on a computer monitor via software for trading virtual currencies.Credit:Bloomberg
But the risk today is that integration into the cryptocurrency community is a world view that could be directed against Western governments themselves.
And the challenge may not be just that of engineering, but of the perceived goal of ideology.
As the alt-right has shown, the current impact of technology on society means that a small committed number of activists with a superior understanding of technology can quickly make big changes.
If there is a long game around the cryptocurrency, the wealth that is created and lost through them could, like so many other things online in recent years, have a geopolitical dimension.
In this way, some of the purists of the decentralized cryptocurrency, those who "resist censorship" to combat the "tyranny" of the banks, may be the troops of assault of this effort to weaken the West, without even knowing it .
Chris is a Digital Foreign Editor at Fairfax Media.
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