Satoshi Nakamoto was so kind as to time the publication of his paper “Bitcoin: A Peer-to-Peer Electronic Cash System” exactly for Halloween, so that we can celebrate two holidays at once, addressing our unchanging trick or treat not to offline neighbors, but to the entire internet.
So let us glorify our ability to perform online peer-to-peer financial transactions on this evening of Saint Satoshi, without which true hardcore agorism today would simply be unimaginable! As for the state, let it be afraid—it is better at that than anything else—so if Bitcoin didn’t exist, it would have found something else to be afraid of anyway.
In the video about anarcho-capitalism, I fantasized about the possibility of Uber-police providing security on the streets.
Of course, right now such a service has little prospect of being implemented because the state jealously guards its monopoly on police functions. Nothing would stop police provocateurs from DDoS-ing the service with false calls, or even using paramilitaries to deal with well-meaning people rushing to help upon a call—whether driven by the heart or by profit. And the service itself would unlikely be able to gain a sufficient number of users while remaining illegal.
However, certain anarcho-capitalist services for the private production of security can be organized today within the framework of purely agorist practices. And first and foremost, I am talking about Uber-retribution.
Imagine a mobile application with the following functionality.
A user launches the app and anonymously uploads information about a certain injustice, accompanying it with a proper evidentiary base: photos, videos, links to independent testimonies, and so on. Then they specify exactly what punishment they consider acceptable for the perpetrator, as well as the amount they are willing to offer to whoever undertakes to ensure this punishment.
Another user has the opportunity to see in this application what injustices fill the world and, if they wish, add their own funds to those already promised for particular cases.
A third user has the opportunity, after choosing a case to their liking, to carry out the requested retribution—and provide proof. Then anyone wishing to do so can independently verify whether the retribution actually took place and leave their opinion on it. Those who reserved their money for the administration of justice can either perform the verification themselves, trust the opinion of third-party experts, or grant the right to manage the prize fund to someone else, for example, the author of the original description of the injustice—though not necessarily to them, and more on that below.
As everyone who placed their money in the prize fund becomes convinced that the retribution has indeed occurred, they release their funds, and their bitcoins go into the wallet of the person who identified themselves as the one who carried out said retribution. One could get fancy here with smart contracts and multi-signatures, use the principle of how OpenBazaar works, or a banal centralized escrow mechanism, although the latter is undesirable as it would mean the prize money is stored in the service’s wallets, which is potentially unsafe. I am not competent enough in crypto-technologies to unequivocally point to the best desired implementation of this specific mechanism.
And as additional functionality, the application could include the possibility of private messaging between service users, a rating system for those who administer retribution, a system of various medals and other pats on the back for those who help co-finance the restoration of justice, search by map, by categories of villainy, and so on.
As is easy to see, the service is quite universal and, with proper quality of execution, allows everyone to remain anonymous except for the object of retribution and the victim (who, however, can claim they had nothing to do with it and ordered no retribution, which may well be true). Also, the object of retribution, upon finding an announcement calling for all sorts of punishments upon their head, can anonymously contact the claimant and try to reach a friendly agreement. Although one cannot rule out attempts to reach an agreement through threats or to eliminate the claimant altogether—and for this very reason, it would be useful to be able to delegate the right to authorize payment to a third-party auditor via the app; then additional violence against the victim would in no way protect the aggressor, as the victim would no longer have the right to stop the launched mechanism of retribution.
Finally, nothing prevents any law enforcement officer, upon discovering information about a certain crime, from treating it as a criminal report—and making some extra money on the side. This would be quite in the spirit of the agorist doctrine of corrupting government servants so they get used to working for people rather than official superiors.
At the same time, it will be extremely problematic by law to hold anyone in the chain of application users accountable, provided, of course, they are not caught red-handed.
Of course, such an application would unlikely be placed in official stores, so one would have to limit it to the circle of Android users and suggest downloading the APK from the project’s website—but this is a trivial inconvenience. Again, all functionality can be perfectly provided via a website to avoid being tied to a phone altogether.
All that’s left is to come up with a name. Without straining my imagination too much, I would call it something simple and clear to all consumers of Hollywood products, meaning all inhabitants of the globe: Wanted.
Besides a service that allows organizing decentralized retribution, it would also be useful to have functionality for collecting evidence: a way to start recording video to the cloud with literally one button, and preferably to stream it, and to do all this in the background with the screen off. Of course, it is important to record the filming time and geolocation, and to have the ability to send a distress signal via SMS to a group of contacts. Various decoys would be useful, allowing the simulation of deleting information from the phone, fake passwords, secret disk space, and so on. Similar applications exist, and nothing prevents them from being posted in the store—but I haven’t heard of all such functionality being gathered into one convenient product yet. I would name such an application vividly: They’re beating our people!
If you have heard of anyone developing something similar, please let me know. If there are ideas for implementation—we can discuss them.
Regarding yesterday’s note on comparing Bitcoin with low-inflation fiat, I received a detailed response. In short, it postulates the importance of stable prices when using a currency as a medium of exchange. To ensure this, a decentralized cryptocurrency fiat is proposed: a crypto whose emission parameters are set by a vote of the currency holders.
To this, I can briefly respond: if anything is a fundamental property of prices, it is their variability. Price carries information about the relative need for goods for specific buyers at a specific moment. If you want the price of a specific good, expressed in a specific currency, to remain unchanged, your only option is to peg the exchange rate of that currency to the value of that good—effectively backing the currency with the commodity. There is no problem with creating a Bitcoin sidechain, freezing a certain amount of Bitcoins, and pegging the tokens issued against them, for example, to oil. That’s it; now one barrel of, say, Brent costs one token. Always. You just have to monitor the collateral size, because if oil becomes significantly more expensive in Bitcoins, the collateral will have to be increased. At the same time, when buying some aluminum or grain with “oilcoins,” you will inevitably encounter price changes.
But all of this has nothing to do with direct democracy, because you can never predict in advance what emission parameters the holders of your crypto-fiat will set. Perhaps they won’t want stable prices for some basket of consumer goods, but will simply take advantage of the fact that the emitter always profits from emission—and issue more tokens to quickly buy up Bitcoins with them. Or do you intend to build a managed democracy and prevent holders from acting so unsightly?
After logically poking at the boundary conditions of the two principles (if a person belongs to themselves, they should be entitled to sell themselves, and may also be stripped of themselves by court decision; as for the application of the non-aggression principle, everything boils down to the definition of aggression, which is subjective, and one cannot build stable orders on such a shaky foundation), they point out that left-anarchism has a solution. As a solution, that same direct democracy is proposed: all orders are established by all members of society.
Here I can only point out that a society of total direct democracy would require some criteria for who to include in the set of voters for each specific issue. Where is the line that, once crossed, a person loses the right to vote on a certain topic because it does not concern them? If there is no such line, we get a society where everyone is obliged to ask everyone’s permission for everything—a legal absurdity worse than the city of Morlow from Interstate 60. I hope to see an answer in the following parts of the review (in the article I analyzed, there is no such answer).
The image of legal absurdity—may it haunt you as well
I keep wondering which currency will prevail in conditions of free currency circulation: a guaranteed hard currency or one with an emission center?
Let’s imagine a hypothetical case of gold/bitcoin versus paper money. In this case, paper money could be issued by a Central Bank or a private issuer (like MMM) and have a pre-announced inflation rate at the beginning of the year (for example, 0.5%). They could also be stored on cards, meaning everything would be like with the dollar, but without the obligation to use it specifically in a certain territory. Mainstream proponents claim that this is better than hard money (because there are fewer crises, as far as I can understand), and I am supposedly some kind of backward Austrian. But I want to argue that it is their statism that has skewed everything in the modern economy, and free people use free money. In short, my question is: which money will win under conditions of freedom—money controlled by a group of economists or free money?
Attached to the question is a donation in the amount of 0.00118933btc
Since you are a proponent of AES, you most likely mean not “price increases”—that is, a decrease in the value of the currency relative to some hypothetical basket of goods—by inflation, but purely monetary inflation, meaning the rate of increase of the money supply. For gold in 2017, inflation was 1.5%. For bitcoin today, it is 3.65%. Presumably, it will equal gold in terms of inflation rates in 2022. Thus, the hypothetical fiat money with 0.5% inflation that you propose comparing with gold and bitcoin appears, at first glance, to be an even better store of value than gold or bitcoin.
However, you did not mention such a parameter as the hardness of money for nothing. By hardness, we mean the elasticity of the money supply in response to a price increase. Let’s say, if the price of gold rises sharply, it becomes more profitable to invest in its development at deposits previously closed as unprofitable, or even in extracting dispersed gold from seawater. Thus, gold is not a very hard currency, but due to the enormous stock of gold accumulated by humanity, even a twofold increase in the global production of this metal would still only increase its inflation to 3%.
In order to increase the supply of bitcoins, a hard fork is necessary. But a hard fork means a split of the chain and the creation of two cryptocurrencies with different emission rates. Naturally, the main mining power will work on producing the less inflationary old bitcoin, and the fork will remain a toy for speculators, losing value even more strongly than could be attributed to the difference in inflation rates. In other words, one can quite confidently assert that bitcoin is an absolutely hard currency, and there are no scenarios in which the production of new bitcoins could increase in response to a price increase.
Now let’s consider a private fiat MMM-coin. Yes, we know that today the inflation rate is 0.5%. But we have no guarantees that tomorrow the emission center will not decide to make inflation 1% or 10%. Fiat whose emission is centralized is absolutely soft money; therefore, its use as a means of saving only makes sense if the investor in this currency has reasons to trust the issuer that the supply of new money will remain low in the future. For example, he holds a hypothetical gun to the issuer’s hypothetical temple, but even in this case, hackers could be a serious problem.
However, the function of storing value is not the only task set for money. The second function is the use of money for settlements. And here, fiat certainly holds all the trump cards. Distributed ledger technology, which underlies bitcoin, will be inferior to the centralized ledger technology used in fiat settlements in terms of speed and cost—at least in the part of the operation where end users of the settlement system are served.
Naturally, the bitcoin community is also solving this problem by proposing the use of technology such as Lightning or sidechains. Their essence is that a certain amount of bitcoins in the blockchain is frozen, and in return, exactly the same amount is launched to move outside the main blockchain. In other words, we are talking about the issuance of fiduciary means of circulation, and if bitcoin is digital gold, then Lightning or Liquid is the technology for issuing digital banknotes.
What can a centralized money producer oppose this with? First and foremost—aggressive marketing. Imagine that tomorrow total ancap and free banking arrive, and the day after, Jeff Bezos releases a fiat Amazoncoin. He can offer his store customers a 10% discount when paying with Amazons. He can provide any other stores with terminals for accepting Amazons for free and charge them less for acquiring than Visa does, or charge nothing at all for the first year. Finally, he can invest tons of money in advertising.
So I wouldn’t write off fiat just yet; it will leave the stage slowly and majestically, and most likely will eventually simply merge with the crypto-economy, turning into fiduciary money backed by bitcoin, just as it once grew out of fiduciary money backed by gold.
Last time, I enjoyed responding not with one large text to a single question, but with short answers to a series of questions. A number of such topics that do not require detailed answers have accumulated in the queue.
Ancap-chi, it seems to me that it is better to promote the term “polystate” rather than “panarchy,” because the latter sounds too much like “anarchy,” and ordinary folks, as I think you know, are very triggered by that word.
It’s a matter of habit. Legend has it that the first libertarians in Russia were often mistaken for vegetarians. Minarchists, naturally, are mistakenly read by many as monarchists. As for the possibility of confusing panarchists with anarchists, at least that is not offensive, because panarchy is one of the paths to anarchy. It seems to me that terms like polystate make sense to be used as auxiliary for now. For example, “I am a panarchist, meaning I advocate for a polystate, or more accurately, for multiple governments within one country” (as Alexey Shustov correctly notes in one of his interviews, in the Russian language, the state is a subject, not a system, which creates inconvenience in political discussions, and it is better to use “country,” “government,” or “regime” depending on the context instead of the overly vague “state”).
I saw an ad for agorists here; they have an article about obtaining an anonymous debit card by forging appearance and a passport. Apparently, there is only administrative liability and a fine of up to 80 thousand for this, but perhaps you know better ways to remain anonymous when making purchases in fiat?
This refers to this post, where at the end I referred to an article from the Cryptoagora channel. By the way, in the post, describing crypto-ATMs, I wrote that they work only in one direction: buying bitcoins with fiat. Later, in Georgia, I verified that the reverse is also possible; there, I actually had to sell bitcoins. I just want to note that for greater anonymity, when approaching a crypto-ATM, you should wear dark glasses, pull something with a wide brim over your head, raise your collar—in short, hide your face as much as possible to shield yourself from cameras. Cameras can be located both in the crypto-ATM itself and around it. Also, of course, when you go to a crypto-ATM, it makes sense to take a phone with a “left” SIM card. All these paranoid measures are intended to complicate operational-investigative actions if you suddenly become their target for some reason.
Is it true that under anarcho-capitalism, intellectual property is not provided for?
Maxim
Any person has the right to monetize any of their intangible assets by any non-violent means. They have the right to use violence only in the case when they are attempted to be deprived of this asset entirely, but not when some information they possess is copied. Even if someone copies the private key to their bitcoin wallet, that is not yet theft. Theft is the use of the key to move bitcoins out of that wallet.
I just cannot understand who will act as the guarantor of compliance with the rules? What happens if some hypothetical Ramzan Akhmatovich in the role of a night watchman decides not just to guard the peace, but to start explaining a bit how people should live?
Noob
Any gatekeeper is inclined to increase their significance at the expense of those they are supposed to serve, i.e., the residents of the guarded facility. The only argument that can bring them to reason is the threat of monetary sanctions, and ultimately, dismissal. For the threat of dismissal to be real, there must be Ivan Petrovich, Ravshan Jamshutovich, Jet Li, and Sigurd Olafson standing behind the gates waiting to be hired. That is exactly why panarchism looks like a more sane idea than minarchism in terms of the possibilities of limiting power.
This morning I discovered something terrible: in a drunken haze last night, I had lost my wallet, which contained all my cash reserves and my bank card.
Alone. In a foreign country. One with which Russia doesn’t even have diplomatic relations.
Naturally, I had plenty of options.
Get married urgently and stay in Georgia
Walk home on foot, racing against a Yakut shaman
Organize a meet-and-greet with readers in Batumi and ask for a loan
Learn the phrase “madam, monsieur, I haven’t eaten for six days” in Georgian
But instead, I started investigating whether there were any crypto ATMs in Batumi. I found only one, but that was all I needed. From there, it was just a matter of technique.
Approach the crypto ATM
Tap the screen, the menu appears, select Withdraw Cash
Select the desired currency, which in my case definitely means Bitcoin
Check the rate, select the amount
The crypto ATM generates a QR code, the code is scanned by a bitcoin wallet on a smartphone, an outgoing transaction is created; you need to choose a higher fee so that the bits arrive quickly, otherwise you’ll be stuck waiting in front of the crypto ATM for a long time.
Then the crypto ATM prints a receipt with a certain redemption code and a notification that cash can be claimed after the first transaction confirmation. When the confirmation arrives, you can go back to the crypto ATM again.
Enter that same redemption code
And that’s it, the crypto ATM dispenses the coveted cash
That’s how I played the part of a blacklisted extremist, and consequently, someone without access to banking services. As is easy to see, Bitcoin is a great help in such extreme situations.
Value the freedom of maneuver that cryptocurrencies grant us! This is exactly what they were designed for.
I have updated the donations section on my website, adding several instructions on using cryptocurrencies, so as not to refer to scattered blog posts.
Also, something unexpected happened to me. When Siberia was covered in smog, I complained in the chat about headaches, throat problems, and sleep disturbances. The smog has eased now, but one of my readers suddenly decided to gift me a trip to the sea, so I will soon head to Armenia and Georgia for a couple of weeks. Such generous gestures are, of course, very overwhelming. But I will try to view the trip more as a business trip than a vacation, and from time to time, I’ll write something interesting in the channel.
Thank you for filling my life with such pleasant surprises!
Or—what are the risks of sending bitcoin to a personal card? Because all I hear from everyone is that it should only be cash. Are there real cases where sending to a card led to bad consequences? Does it depend on the amount or other circumstances?
анонимный вопрос
The most direct way to exchange bitcoin for fiat is to sit down together, agree on a deal, then the fiat amount is placed on the table, the bitcoin seller transfers them to the buyer, the parties wait for the first confirmation, after which the seller takes the fiat from the table and puts it in their pocket.
The main inconvenience with this type of deal is the need for very serious trust in the buyer. Nothing stops the cash owner from pulling out a gun after the transaction is complete and demanding their cash back, as well as the private keys to the bitcoin wallet. Using bank transfers instead of cash at least allows you to avoid meeting in person. Therefore, a service such as localbitcoins has gained considerable popularity.
The essence of exchanging through this service is that the parties trust the service itself rather than each other. One party publishes an ad, the second responds to it, after which the seller’s bitcoins (previously transferred to an online wallet belonging to the service) are frozen. When the bank transfer is received from the buyer, the seller notifies the service, and the service transfers the bitcoins to the buyer. If a conflict arises, the service acts as a judge (so-called escrow), requires proof of money transfer and proof of non-receipt on the account from the parties, after which it makes a decision in favor of one of the parties.
From the bank’s point of view, it is a transfer from one individual to another individual. The bank knows nothing about any bitcoins. Reversing such a transfer is practically impossible. Of course, as part of the fight against money laundering, the bank may freeze the transfer, but that is the buyer’s problem—they will not receive the bitcoins, the frozen amount will simply return to the seller, and the seller can make another attempt.
Localbitcoins is a large international service that is good because it allows you to obtain fiat money from any country, wherever you are. But specifically in Russia, I personally find it more convenient to use a Telegram bot with completely identical functionality (I have already advertised it here).
In any such service, there is also the option to buy bitcoin for cash. I haven’t used it myself because the rate is usually much less favorable. Remotely, this is done by topping up the bitcoin seller’s card with cash at an ATM. This method provides the greatest security for buying bitcoins, as the buyer’s personal data does not reach any bank. As for the seller, they don’t care; the fiat still ends up in a bank account.
Bitcoins can also be bought for cash in crypto ATMs, but selling them for fiat in this way is not yet possible. As Lightning is implemented, crypto ATMs with the ability to operate in both directions will likely enter the market.
To summarize. Buying bitcoins for cash is indeed a way to ensure additional anonymity. Selling bitcoins for cash carries the same risks at best, and even more serious ones at worst. As long as your sales volume is small, receiving fiat on a bank card is the most reliable way to protect yourself. When volumes grow, you can accept fiat on cards from different banks. If they grow even further—try using strawmen.
And for the most paranoid, I want to recommend an article from a very peculiar channel Cryptoagora, where even more curious ways of ensuring anonymity when working with fiat are detailed.
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.
The main factors ensuring Bitcoin’s current dominance:
Network effect. A huge number of people own Bitcoins, and they didn’t receive them through an airdrop, but incurred costs to acquire them, meaning they value them. Since others value them, one can boldly accept payments in Bitcoins; they are liquid.
Low emission rates. The Bitcoin mass increases slowly, meaning that in the long term, this money will at least preserve its value. Thus, Bitcoin is suitable as a store of value; there is no need to rush to get rid of it if someone happens to pay you in bits.
Decentralization. To set up a wallet, you can choose from a multitude of programs or even write one yourself. To transfer money, you don’t need to ask permission from a single transaction verification center—there are several tens of thousands of nodes in the network.
These main factors are enough so that, should you wish, you could easily sell your goods for Bitcoins or, conversely, buy goods with your Bitcoins. Or simply hold bits and enjoy the price growth.
Gram, issued as part of the TON project, will be successful if it can satisfy roughly the same criteria.
Network effect. This could potentially be very large if nothing more than Telegram is required to use the coins, and a ton of people have Telegram. But the ability to buy Gram quickly and conveniently with fiat will be necessary. If buying Gram requires first buying Bitcoins, then it is completely unclear why it is needed as money, since Bitcoins themselves already exist.
Low emission rates. I haven’t looked into the creators’ plans regarding this, but if the growth rate of the Gram mass turns out to be higher than Bitcoin’s, then the price will likely decrease relative to Bitcoin in the long run.
Decentralization. Here, as I understand it, everything is bad. First, to achieve high transaction speeds, it is intended to maintain a very modest number of nodes. Second, if a Telegram account is needed to manage these coins, it means the money is completely centralized: any account can be banned by the Telegram administration at any moment. If these funds can be managed without Telegram, then it’s unclear what Telegram has to do with it.
So I am quite skeptical about TON, but Gram can certainly be used as a speculative asset; hyperinflation definitely does not threaten it.
And, of course, it is currently difficult to consider a currency decentralized if it depends entirely on a single creator
