Josh Mandel, a disciple of Trump who is trying to be nominated for a Republican senator from the state of North Central Ohio, recently tweeted his principles: “Ohio needs to be a pro-God, pro-family, pro-bitcoin state.” . In fact, there is an old connection between support for bitcoin and right-wing extremism — like the traditional association between conservatism and an obsession with gold, only stronger.
So what does that mean?
The fact that many bitcoin enthusiasts say bizarre things in and of itself does not mean that cryptocurrencies are a bad idea. People can support the right things for the wrong reasons. For example, I’m sure many people accept the scientific consensus on, say, the effectiveness of vaccines not because they value peer-reviewed research, but because they are impressed by people in lab coats who use difficult words.
But it really does seem important to understand the cult aspects of the cryptocurrency movement.
First, though, a little about economics.
Sometimes I still meet people who say that we live in a digital age, so we should use digital money. But we already used it! Like many people, I pay for most things by clicking a mouse, inserting my credit card, or pressing a button on my cell phone. I used to keep change in my wallet to buy fruit and vegetables from street stalls in New York, but nowadays even they accept cards.
All these payments, however, depend on trust in a third party. People accept debit cards, electronic payment etc because they are linked to a bank account. The whole point of bitcoin, as explained in its original 2008 document, was to abolish the need for this type of trust: it would validate payments using methods related to cryptography — coded communication. The aim was to create a “peer-to-peer” payment system, independent of financial institutions.
But how to do it? Are banks so unreliable? I have been to many meetings where crypto skeptics have asked, as respectfully as possible, simple examples of things that can be done better or cheaper with cryptocurrency than other forms of payment. I haven’t heard a clear example yet that doesn’t involve illegal activity — which, to be fair, can be easier to hide if cryptocurrency is used.
The truth is that while bitcoin has been around for a long time by internet standards—13 years!—it and other cryptocurrencies have barely made any inroads into the traditional role of money as a medium of exchange used to buy goods and services. Hard numbers are rare, but it seems that the vast majority of cryptocurrency transactions involve market speculation rather than the ordinary business of life.
But bitcoin and its rivals today have a combined market cap of more than $1 trillion. What do investors think they are buying?
One answer is protection against the eternal fear of governments inflating their wealth — as a recent Bloomberg article put it, some billionaires are buying crypto just in case the money “goes to hell.” In fact, there have been 57 hyperinflations in the world, as far as we know. However, they all took place in the midst of political and social chaos; do you really think that in such an environment you would be able to go online and withdraw your bitcoins?
There is also the fear of “missing the chance”. Bitcoin has reached something of a sweet spot: it has a high-tech, futuristic feel, while also catering to political paranoia. The resulting capital gains have led many apolitical investors to feel they need to get in on the game, while also likely inducing public figures like Eric Adams, the new mayor of New York, to praise bitcoin because they imagine it makes them look forward-thinking.
But do the confusing explanations about bitcoin mean it is destined to implode? Not necessarily. After all, gold ceased to serve as a medium of exchange generations ago, but its value has not plummeted. And we must not discount the importance of illegal activity. There are around US$1.6 trillion (R$ 9 trillion) in US$ 100 bills (R$ 563) in circulation – 80% of all US currency – despite the fact that it is very difficult for ordinary consumers to spend large bills. value. What do you think people are doing with all the $100 greens?
But let’s put market predictions aside and ask what’s in the deepening alliance between bitcoin and Donald Trump’s “MAGA” —Make America Great Again” movement.
The answer, I would argue, is that bitcoin should create a currency system that works without trust — and the modern right is all about fostering distrust. Covid is a scam; the election was stolen; California wildfires have nothing to do with climate change, they were started by Rothschild-controlled space lasers.
In this context, it is perfectly natural for Trumpist politicians to call for an end to a monetary system that works through banks — we know who controls them, right? — and relies on a currency that is managed by government-appointed officials. There is no evidence of widespread monetary abuse, but that doesn’t matter to the far right.
The point, then, is that while there are real economic issues associated with cryptocurrency, its rise has a lot to do with the widespread political madness that has brought American democracy to the brink.
Translated by Luiz Roberto M. Gonçalves
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