Here, it seems to me, the confusion is caused by the claim about contract jurisdictions—that they will replace the state. “Yeah,” a person says, “so every house in the village will belong to a different state; what kind of mess is that going to be?”
What does the fact that a person’s house is in a certain jurisdiction actually mean for them? It means that if the house becomes the subject of a conflict, or if a conflict occurs on its territory, the resolution of that conflict (if the homeowner for some reason decides not to do it themselves) is handled by the jurisdiction.
The only case where a conflict arises with such an approach is a boundary conflict. For example, there is a dispute over who owns the fruit from a branch of a tree growing on one plot that overhangs another plot. In this case, both jurisdictions would have to be involved, and it becomes their task to agree on how to resolve the conflict.
And, obviously, if a client is not satisfied with how their contract jurisdiction handles conflicts, they look for one that presumably will do it better and enter into a contract with it. In general, fundamentally, nothing here differs from buying home insurance or a contract with a provider for connecting a home to the internet, gas, water, or electricity. Except that changing a jurisdiction is much easier than changing a gas supplier.
If the apple example seems trivial, what would you say about a boundary conflict over an oil field?
Investments and exchanges are the foundation of the entire market economy today. Essentially, in the absence of a regulator in the form of the state, traders would be able to gain virtually unlimited power: they could inflate prices or, conversely, crash them to zero, destroy some companies and promote others. So the question is: how will exchanges work in ancap? What alternative will be offered to investors instead of the stock exchange in the event of its liquidation? How can the dominance of traders over the market be prevented?
Muller
The order book is, in fact, the quintessence of the free market. Pure supply and demand, stripped of any rhetorical fluff. It is not for nothing that the foundations of Austrian economic theory were laid by a stock market observer. So, of course, in a free market economy, the role of exchanges will only strengthen.
What are the main dangers facing an investor on the exchange?
First, these are possible exchange manipulations.
In the world of stock exchanges, blatant manipulations have become a great rarity because they care about their reputation. If we encounter any restrictions from trading platforms, these are usually requirements of external regulators—for example, regarding the suspension of trading in a situation of market panic. I do not know which exchanges companies will prefer for listing their shares—those that provide for an automatic stop of trading during price spikes, or those that guarantee continuity. Let the consumer choose.
In the world of cryptocurrency exchanges, attempts to protect against exchange manipulations led to the emergence of demand for decentralized platforms, where you cannot fake volumes. I would not be surprised if over time stock exchanges are also pushed aside when crypto-tokens begin to take the place of company shares.
Secondly, possible insider manipulations.
This is, in fact, a problem not of the exchanges, but of the companies that are traded on them. Even now, private companies are taking measures to prevent such machinations—through non-disclosure agreements for insider information that provide for serious payments for their violation, as well as through moratoriums on trading company shares for its employees in periods shortly before the publication of regular reports. The absence of such measures will simply be taken into account in the share price of specific companies as an additional risk factor.
Thirdly, market maker manipulations—traders who have access to very large capitals. This is the factor you are writing about.
Here, one can only say one thing: if you want to be indifferent to such manipulations—simply do not take loans secured by shares. Then you will not have to dump shares due to a margin call if someone temporarily crashes the price. No market maker is capable of completely zeroing out the shares of a prosperous company: no matter what panic rumors he spreads, no matter what volumes of shares he dumps onto the market, if you simply forget about your stake for a month or two, you will lose nothing; the price will return over time, it’s just that some will sell securities during this time and some will buy. It’s not even a fact that the trader who started all this will necessarily profit. He is not the only one—a large movement will attract others, and they will play it their own way.
So, there is no question of trader dominance in a developed market. This is simply their habitat. The more of them there are, the better the life of the companies traded in this market, and the harder it is for traders to manipulate the price of assets.
In general, exchanges are simply a tool through which it is convenient for a seller and a buyer to find each other. This is not some self-sufficient entity. If the tool works correctly, it will not cause damage to real companies in itself.
Consultations were used in the response from Srpski, as a gesture of gratitude he asked to reference his channel “Serbian Divergent”.
I recently read a very good article on Freedom Pride about how a model was built with fairly realistic assumptions, and depending on the input data, it demonstrated what works better: contractual jurisdictions, democracy, or ancap.
The point of modeling is to see how the costs for members of society decrease depending on what mechanisms they have for adapting to and influencing society.
The conclusions in the article are written in rather cumbersome language, so I will translate them for myself in simpler terms.
Democracy is a poor mechanism for optimizing one’s costs of existing in a society. Here, I cannot help but refer to my own longread on the subject.
Instead of seeking changes through democratic mechanisms, it is much more reliable to reduce costs by voting with your feet—leaving the society that does not suit you and moving to one that does.
The lower the relative costs of financing public goods, the more advantageous ancap is. The higher they are, the more advantageous contractual jurisdictions are. And for this last conclusion, I am very grateful to the authors of the article: they claim this is an argument for CJ, but for me, it means that as technical progress advances, ancap will become increasingly advantageous.
The political program of libertarianism boils down to the consistent reduction of the role of the state, that is, deregulation and tax reduction.
If movement in this direction leads to an increase in the security and wealth of residents until the state is reduced to the role of a “night watchman,” and further curtailment of state functions causes the level of violence to rise and prosperity to decrease, then the minarchists are right and the ancaps are not, and there exists a minimum state optimum below which it cannot be reduced.
If the state optimum is not found, and every reduction of the state brings only benefit to the people, then the ancaps are right after all; the state is a harmful parasite and must be completely eradicated.
If an optimum is found, but not where the minarchists assume it to be, but, say, at the level of “night watchman plus a poorhouse,” then the social liberals are right, and the hardline libertarians, with their meager brains, have failed to grasp the full importance of competent centralized redistribution of resources.
And finally, if it turns out that sustainable results are impossible to achieve because different societies have their own optimum of state functions, then the panarchists are entirely right: people are too different to be treated with a one-size-fits-all approach. Some need more state, some less, some zero—let everyone receive according to their request.
But in order to achieve all these results, a willingness of people to experiment in building a society convenient for them is necessary. However, decades of violent socialist experiments have largely discredited the very idea of consistently building something new. Therefore, we now more often see sporadic attempts to improve something, followed by rollbacks. But just as a long peace has taught people not to take the danger of a major war seriously, a long period of ideolessness can return the taste for reforms to the people. Our task is to ensure that at that moment, the idea of specifically libertarian transformations is floating in the air.
According to libertarian law, the sale of alcohol and tobacco should not be prohibited by force of law (nor should it be subject to fines), including to minors, because it is a victimless crime.
Given that I am currently working as a cashier, my colleagues and I ask for IDs from everyone except those who look under 50, because those participating in sting operations are 17-year-olds who look much older than their age: young men with gray hair, thick beards and muscular builds, and girls who are tall, stout, with makeup and “first” wrinkles. Dozens of customers daily harass us, telling us “not to take it to the point of absurdity” or to stop creating “Kafkaesque” situations. The solution proposed to me by the surrounding statistes is even more of a hell—to ask everyone, to lobby for checking documents through the register as in the USA, etc. My old acquaintances and friends harass me by saying that alcohol consumption at a young age increases the risk of alcoholism many times over. Yes, I am aware. Moreover, I myself actively stood by the same prohibitory position, was an active lobbyist and advocate for control measures on alcohol and tobacco, which was sometimes a topic for discussion with these friends and acquaintances or even a reason for meeting. That is why my social networks are under tension right now. But it is inevitable. Much water has flowed under the bridge since then; I have been studying economics and history for three years, and for the last few months, I have openly considered myself a libertarian.
So, the sale of a product that sits on a store shelf for legal money is not violence. But some people believe that by selling to those under 18, I am committing violence. People tell me that advertising and propaganda force one to start drinking, and that until a certain age, a person supposedly has no freedom of choice. As if they acquire it on their 18th birthday. As if they have none at all before that. Simply, parents should handle upbringing while children live with them, not the state. This answer does not satisfy such people.
How can I clearly explain to them that the decision to sell or not sell anything should be made by the owner, and they should not be punished for selling or not selling?
Sergey Sushinsky
I would suggest approaching your argumentation from two sides.
First, you need to demonstrate that the very idea that the state does good through trade bans is a poor idea. Remind them how in the Soviet Union people were imprisoned for trading foreign currency, and in general for any entrepreneurship involving reselling (for this, a seemingly neutral economic term, “speculation,” was used as a condemnation). Later, currency trading was permitted, but no one compensated those previously imprisoned for currency operations for their losses. All over the world, the trade of marijuana is gradually being legalized, while in Russia, more people are imprisoned for the distribution of substances than for theft. And when marijuana trade is permitted in Russia, it is likely that no one will compensate the losses of all those previously convicted under Article 228 of the Criminal Code of the Russian Federation. Remind them that in many Islamic countries, the sale of alcohol is illegal not only to children but to adults as well. In short, there are many restrictions on free trade that are introduced by the state and then repealed. So why did they decide that the ban on selling alcohol to children is actually necessary and will not subsequently be repealed by the same state as mistaken or even criminal? And who will then reimburse alcohol traders for their losses in fines and bribes during the period of the ban?
Secondly, point out to them that if the satisfaction of a need is pushed out of the legal field, it begins to be satisfied illegally. A child was unable to drink beer and smoke cigarettes—they have an unsatisfied need and unspent money. Tomorrow they will buy mephedrone. Maybe it would have been better to sell them beer?
Today I have two polls for you. The project has started to take up quite a lot of time, which has increased the importance of the question of its monetization. To avoid making mistakes while trying different options, I first want to ask about your preferences.
В какой форме вам наиболее удобно присылать донаты?
So, the distributed translation of “Mechanics of Freedom” is slowly picking up pace. The first part I received was the third chapter of the book: “Love Alone is Not Enough,” and after some edits, I have just published it.
As a reminder, you can speed up the process or simply express your gratitude by sending bitcoins. On the donations page, I provide various ways to do this.
And, of course, you can always choose a chapter for yourself to translate.
Don’t they love it? I would say it is more like touching courtship. When three or four channels I follow posted their ads, I was somehow too lazy to go and see what they were writing, but here I finally got around to it, so well done, they used a winning tactic.
I have exactly one complaint regarding the “Libertarianism in Schemes and Memes” channel, which Grigory Bazhenov voiced to them some time ago: where are the schemes? I looked, and they really aren’t there. A shortcoming.
A picture posted in schemememes brought me 15 new subscribers. Guys, make yourselves comfortable; I will try to avoid long delays in publications in the future.
As for “memes for Russians,” I am still too lazy to drop by. But if they post something interesting there, let me know and I’ll take a look. For now, schemememes reliably protect them from my attention, for which the protected ones, I hope, will thank them.
I answered a question about my attitude toward TON, after which a TON expert came to my chat and shared a lot of juicy details. Then a Lightning Network expert appeared in the chat and explained why TON is not needed. I followed his recommendations and convinced myself that it is already possible to send bitcoins to each other in Telegram instantly and with negligible fees. I think this new knowledge deserves a detailed instruction, because theoretically many people are familiar with Lightning, but in practice, few understand how to actually use it. I will provide the simplest recipe based on Telegram, simply because it is the most relevant for me.
1. Buying bitcoins
The simplest way to buy bitcoins with fiat is using a Telegram bot. I have left a referral link, so not only can I get a small profit from you using it, but I will also know how many readers found it useful. By launching the bot, you become the owner of an empty online wallet, which is where you will buy your bitcoins.
By clicking “BTC/RUB Exchange,” you will see the current exchange rate. This is only a rough guide; the rate in the bot may differ significantly. Click “Buy” and you will enter a board of private ads, grouped by types of bank cards or other electronic fiat money.
Suppose you have a Sberbank card. Click the corresponding button and you will see a list of ads for selling bitcoins:
Choose a suitable ad, click on it, start the transaction, and specify the amount in rubles you intend to purchase. If the advertiser agrees to your offer, you need to transfer the money to the specified card, after which bitcoins will be credited to your wallet in the bot.
Important: all communication with the seller is conducted only inside the bot, because its administration provides arbitration in case the deal falls through. The seller’s bitcoins are blocked on their account until they receive your rubles. As soon as they arrive, the seller releases the bitcoins, and they are transferred to you.
2. Opening a payment channel
The Lightning Network technology boils down to people opening payment channels (something like off-chain deposits) for a certain amount, then exchanging receipts, and later, when someone decides to close the channel, a netting occurs, and the remaining balance in the channel is returned to the blockchain. There is quite a complex mechanism inside, but it’s not necessary to delve into it; I don’t delve into it myself.
To open a channel, you need a lightning node, and since maintaining one yourself is a hassle, it’s easier to use a public service. I was recommended the exchanger https://zigzag.io. Open it, select bitcoins in the “you send” field, and also bitcoins in the “you get” field, but with a lightning bolt on the avatar:
Then you need to specify the address to return the change to (the “BTC refund address” field) and where, specifically, to send the money (the “BTC lightning invoice” field). For the change, you can specify the same wallet from which you are sending the money, or any other one you have.
To find the destination wallet, you need to launch the @lntxbot in Telegram. Then send a private message to the bot: /invoice and it will generate a string of gibberish:
Copy it and paste it into the “BTC lightning invoice” field, click “Exchange” — and you will see something like this:
Simultaneously, a message about the receipt of funds will come from the bot to your private messages:
That’s it, you have opened a payment channel.
3. Using lightning
The most important command that you will need in @lntxbot after this looks like this: /pay @ancapsan After this, I receive the amount you have chosen. Of course, you can easily transfer money to any other Telegram user (even if they haven’t launched the bot themselves, the money will go to them, and they will see it only after they launch it).
You can ask the bot about other commands using the /help command
4. Closing the payment channel
So, you have some money left in the lightning network, and instead of sending it to me, you decide for some reason to withdraw this balance back to the blockchain. Go to Zigzag and perform the reverse operation:
Specify the same bitcoin address on both the left and right sides, click “exchange,” and now the exchanger will generate an invoice for you. Then go to the private messages of @lntxbot and write: /pay
That’s it, the payment channel is closed, and the money not spent in the lightning network returns to your wallet. As for dealing with bitcoin wallets, entire volumes have been written on that; you’ll figure it out yourself.
I’ll be glad if the article was useful to you. Be sure to try how it works. If previously a large commission size stopped you from donating to certain causes, making small tips unjustifiably expensive, you can now make people happy without such torment. First, deposit a sum into lightning that is sufficiently large relative to the miners’ commission, and then spend it in arbitrarily small portions whenever it strikes you. It is the large volume of small donations that distinguishes truly popular projects, not a couple of dozen large donations.
So, I am officially beginning the translation of David Friedman’s “The Machinery of Freedom.” All the English text is posted on the website in the section “The Machinery of Freedom – original”. This includes the text of the second edition, as well as chapters prepared by David Friedman for the third edition, which I took from his website.
Translated chapters will be gradually posted in the section “The Machinery of Freedom – translation”. For now, as a teaser, I have translated and posted the introductory materials, and I am currently working on the first chapter. I have also posted five chapters translated some time ago by Elena Mokeeva commissioned by the Libertarian Party of Russia, but these still require editing to bring them to a consistent style. Anyone interested can take on the translation of a particular chapter and then send me the results of their work; I will edit it and add it to the project. Before starting a translation, it is best to contact me via DM to avoid collisions.
When the translation is fully completed, I will compile it into a single PDF for those who prefer reading on paper, and into an EPUB for those who prefer reading from a screen. The text will also remain on the website, posted by chapter—this is convenient for referencing specific chapters in discussions.
If you think this is a worthwhile endeavor, I kindly ask you not to keep your opinion to yourself, but to support the project with bitcoins or direct participation; together we will finish faster. As new chapters are posted, I will be sure to announce it in the channel.
For donations, my bitcoin wallet is still a great option: 1A7Wu2enQNRETLXDNpQEufcbJybtM1VHZ8. I have also recently discovered the magical world of the Lightning network, which will be the subject of a separate article, so you can send me money directly in Telegram using a special bot. Lightning is great because it allows for the instantaneous transfer of small amounts with extremely modest fees. But you will read more about this a bit later.
