When the still-unknown entity Satoshi Nakamoto published the flagship bitcoin white paper in 2008, he outlined a system for currency creation and regulation that was free from meddling middlemen, both public and private.1
Since then, however, both classes have tested bitcoin's original vision. The U.S. government - specifically, the Internal Revenue Service - has sought to bring bitcoin at least partially under its aegis with byzantine tax rules. Regulation of cryptocurrency exchanges could soon be next. Perhaps more insidiously, however, private interests have sought to insert themselves into the peer-to-peer blockchain. Their motivations range from practical to farcical. The common theme, however, is stubborn resistance to change.
New World Order
The ur-example of such an industry lightning rod is Blockstream. Although its existence predates its involvement in bitcoin, Blockstream rose to prominence around 2016 by hiring several major bitcoin developers. Ostensibly, Blockstream operates a developer of auxiliary chains and bitcoin features, like the Lightning Network.
As such, however, Blockstream functions as a sort of gate to bitcoin development. It limits block size and thus the organic growth and development of the blockchain itself.2
If you trace the food chain up a level or two, the picture becomes even more autocratic. French insurance titan AXA is one of the primary investors in Blockstream. AXA, in turn, was formerly headed up by Henri de Castries. Castries is perhaps most notable for being chairman of the shadowy Bilderberg Group, beginning in 2012.
The Bilderberg Group makes the rounds on various conspiracy outlets on the internet alongside reptilian aliens, demonic cults, and Dan Brown-esque Illuminati organizations. The group, however, is quite real. Made up of business and government leaders, the group acts as a sort of think tank for the "cultural elite". The nature of the organization means its goals and means are largely secret. Knowledgeable Bilderberg participants have, in the past, hinted that organization strives for a flavor of world governance, guided by capitalist and predominantly Western principles - a new world order.3
If true, then the Bilderberg Group's involvement in bitcoin via associations with AXA and Blockstream are troubling. The very nature of bitcoin should insulate it from consolidated interference. If, however, all development and sidechain creation are routed through a single entity, then the blockchain can only really develop within certain narrow pathways. It is unlikely, for example, that the Bilderberg Group would allow bitcoin to develop in a way that's contrary to its free market, Western principles. In effect, bitcoin becomes a technological version of the almighty U.S. dollar.
Despite their differences, Silicon Valley giants tend to flock together. This is for both protection from government intrusion and for shared development. There is significant cross-pollination in the industry, as executives and coders flip back and forth. Generally, what is good for one portion of the tech sector is good for another.
Cryptocurrency, however, has always been the odd man out. It represents a different kind of technological hegemony - one that is not dominated by Silicon Valley or a huge corporate entity, like IBM, HP, Google, or Facebook.
That relationship was made semiofficial in early 2018 when both Facebook and Google announced they would be banning all cryptocurrency advertisements on their respective platforms by summer.4
"In June 2018, Google will update the financial services policy to restrict the advertisement of contracts for difference, rolling spot forex, and financial spread betting," the company said in a statement. "In addition, ads for the following will no longer be allowed to serve: Binary options and synonymous products; Cryptocurrencies and related content (including but not limited to initial coin offerings, cryptocurrency exchanges, cryptocurrency wallets, and cryptocurrency trading advice)."5
The move was attributed to fraudsters in the crypto sphere. By banning all cryptocurrency advertisements, Facebook and Google sought to protect its users from potentially malevolent scams. This is an echo of the warnings issued by the U.S. Securities and Exchange Commission to users and operators of as-yet unregulated crypto exchanges.
The bans amounted to, "Fire can sometimes be dangerous. Therefore, it's better if you never see anything about fire at all."
Debate rages as to exactly how justified this move was. Google and Facebook have come under fire in the media and before Congress for their data collection and advertising practices during the 2016 presidential election. These practices, apparently, were less controversial internally than permitting cryptocurrency advertisements. Although Google does enforce advertisement bans for some services - like for-profit addiction treatment and locksmiths - its general advertisement policy errs to the side of open.6
Perhaps bitcoin's most deadly private challenge comes from the banking sector. This isn't surprising, as banks are one of the targeted middleman classes that bitcoin sought to make irrelevant.
Several major banks, including JP Morgan Chase and Bank of America, do not permit cryptocurrency purchases via Coinbase with their issued credit cards. Users are still free to buy crypto with debit cards or money transfers.7
The reasoning given here is that banks do not want their cardholders to rack up large sums of debt on speculate ventures. It's an odd reasoning coming from a financial product that thrives on accumulated debt.
The accusation from the crypto sphere is that banks feel threatened by a marketplace that promises to sever them from their customers. Moreover, crypto proponents allege, the potential rewards and long-term safety of investing in the crypto market might just outweigh the rewards and safety of investing in a traditional bank. Even if those two factors eventually reach parity, some folks might choose to eschew banks altogether for crypto investments for personal or political reasons. Crypto blockchains do not have political opinions; they do not make campaign contributions; and they do not willingly share information with governments. Following Nakamoto's original vision, an investment in crypto is a thumb in the eye of every banker who fiddled with rates or bundled together bad investments for personal profit.
Bitcoin faces a variety of challenges from the public and private spheres, in addition to more basic problems, like adoption and long-term development. This is only natural. The crypto sphere is, by definition, disruptive to business as usual. That is the source of the target on its back and also the source of its greatest strength. By spreading the weight of the blockchain across a wide user base, bitcoin and other cryptocurrencies can sidestep blocks put in place by established big-money and big-tech names.
Jonathan Turpin of Indiana University predicted many of these woes in a paper published in 2011. His overall assessment, however, was bright.
"There is no guarantee that bitcoin will succeed," he wrote. "There are too many unknowable variables. It is possible, perhaps even likely, that a currently unknown competitor might overtake bitcoin and replace it. One of the core developers of bitcoin has stated that he would embrace this, as he supports competition and believes that it ultimately works for the best Whatever happens, one thing remains undeniable: the world is forever changing, and governments and businesses must stay abreast of these changes if they are to maintain their positions of power in the future."8
1) Nakamoto, Satoshi. "Bitcoin: A Peer-to-Peer Electronic Cash System." Oct, 2008. https://bitcoin.org/en/bitcoin-paper
2) Buntinx, JP. "What Is Blockstream?" Nulltx.com. May 3, 2017. https://nulltx.com/what-is-blockstream/
3) "Secretive Bilderberg Group Meetings Begin in Virginia." BBC. 1 June, 2017. http://www.bbc.com/news/world-us-canada-40125253
4) D'Onfro, Jillian. "Google Will Ban All Cryptocurrency-Related Advertising." CNBC. 14 Mar, 2018. https://www.cnbc.com/2018/03/13/google-bans-crypto-ads.html
5) "Financial Services: New Restricted Financial Products Policy (June 2018) - Advertising Policies Help." Google. https://support.google.com/adwordspolicy/answer/7648803?hl=en&ref_topic=29265
6) "Healthcare: Addiction Services (April 2018) - Advertising Policies Help." Google. https://support.google.com/adwordspolicy/answer/7683376?hl=en&ref_topic=29265
7) "Coinbase Confirms 4 Banks Blocking bitcoin Credit Card Purchases." CoinDesk. 6 Feb, 2018. https://www.coindesk.com/coinbase-confirms-4-banks-blocking-bitcoin-purchases-on-credit-cards/
8) Turpin, Jonathan. "Bitcoin: The Economic Case for a Global, Virtual Currency Operating in an Unexplored Legal Framework." https://www.repository.law.indiana.edu/ijgls/vol21/iss1/13/