Cryptocurrency vs. The HSBC

Ah, the world's banking institutions, where to begin? Perhaps as good a place as any to start would be this: the HSBC money laundering scandal whereby this giant multinational bank admitted to laundering billions of dollars for illegal drug cartels. Yes, that happened. Couple that with the horrible policy missteps before and after the crash of 2008 and you've got some woefully unethical business practices, committed by institutions that are were trusted by billions and that billions rely on. In fact, the corruption displayed by the world's largest financial institutions has been unparalleled, and  it reveals that there is in fact a two-tier legal system, one in which the banks are above the law. These institutions govern and impact our day-to-day lives more than anything else in our society, and yet they're just another indication that the systems in place don't remotely serve our interests, the 99 percent. It seems safe to assume that when our daily lives are so intertwined with the policy and decisions of these institutions that there should be not only some form of regulation (there is very little left after deregulation became the new way of doing business), but also accountability, and it has become clear that there is none. 

If a rich man is proud of his wealth, he should not be praised until it is known how he employs it. - Socrates

Given that the banks are having serious issues these days, it should then follow that we need alternatives to dealing with them, and that's where cryptocurrency comes in. Before we delve into that, however, let's first take a step back and examine money and the fractional reserve banking system as we understand it today. Although economists would have you think that the system is too complex to explain to us plebs, their jargon only serves to obfuscate what is really not all that complicated. In essence, when you deposit $100 into your bank account, the bank, by law, is allowed to lend out $90 of it (keeping a fraction in reserve) and thus, money is created. In fact, your $100 will ultimately be turned into $1000 over time. Money out of thin air. While the cornerstone of our money system, it leads to inflation and the devaluation of our money, and because of these simple facts it is an unsustainable system with a finite life-span. Symptoms of it's finality have already been seen in market crashes throughout modern times. Even the Federal Reserve Bank (or The Fed) is a lie, as it is a private corporation attempting to disguise this by appearing to be a government institution. Economists will tell you that it's not that simple, because they are heavily invested in the system. Let's then look at the word economics for a second. Does it not mean to economize? To make efficient and without waste? Well, our current system of economics is failing at that with gusto. For this reason, and for many others, people have looked to other systems, systems outside the banking world and not within its jurisdiction.

The problem with the world is that fools and fanatics are often so certain of themselves, and wiser people so full of doubts. - Bertrand Russell

Enter BitCoin, the world's first cryptocurrency and also the world's first decentralized form of money. A digital currency not based on the gold standard or any other fiction, it has shaken up the financial world and opinion is remarkably divided on its validity. Some economists, like Max Keiser of The Keiser Report, are strong proponents of it, and he states his case quite eloquently. Decentralized, above government authority, by the people, anonymous and free, BitCoin represents a fundamental shift in what we can achieve through progressive and alternative thought. There exists, for the first time in human history, a system of money that we own and control, and this is an exciting step towards autonomy. In a world where the establishment holds such a stranglehold on the institutions that we rely on, ideas like this remain the only way left for social change to occur - outside and above the system. If the big bankers want to operate above the law, then we will create our own methods of doing the same. The primary difference being that we are ethical. When CableGate erupted and WikiLeaks was put under the gun, while not illegal to donate to them, VISA, MasterCard and PayPal all refused to process transactions going to WikiLeaks, because of government pressure. In a world of decentralized currency, this could not happen.

Just like any decentralized system without government intervention (or even with it) there will be bad apples in the bunch. Do we choose to control the entire Internet because some will abuse it? A rhetorical question maybe, but that would by tyranny. If some people refuse to play by the rules, then we need to address the underlying issues of why that is, and not destroy freedom in the attempt to control them. In fact, studies on honesty reveal that most people are in fact exceedingly honest and want to be. As we embrace new ideas like BitCoin, we take the power back for ourselves and learn to govern ourselves, as autonomous individuals in a free society. While BitCoin and other types of cryptocurrency are not yet considered stable enough to invest your life savings in (and there are criticisms of this very young currency or course), it is an exciting venture into a new world where the power is taken back by the people. Just imagine, no middle-man, virtually no fees, no credit card companies and no government intervention. Embrace it and may you prosper!

The difficulty lies not so much in developing new ideas as in escaping from old ones. - John Maynard Keynes

I can't understand why people are afraid of new ideas. I'm afraid of the old ones. - John Cage