Endless Bitcoin point-missing

Greenwald has a long interview with a bitcoin activist. At least for the purposes of argument, Greenwald is taking the objective devil’s advocate side. As an experienced lawyer, he knows how to do this.

The anonymous (clearly German) bitcoiner brings up all the usual stupid arguments about decentralizing and freedom from authority. Greenwald does an excellent job of pinning down all the vague abstract ideology to concrete facts… Except the most important fact.

FACT: Bitcoin runs on the web. Therefore Bitcoin is NSA.

NSA provided easy clues to the origin in the Satoshi story, but you don’t need the story. The simple basic technical fact is unavoidable.

When you’re using the web you’re running directly through Five Eyes.

NSA’s job is monitoring and decrypting EVERYTHING. That was their original job description, and the Web gave them the ultimate universal monitoring power. If you think your DIGITAL encryption is unbreakable, you’re forgetting who invented DIGITAL encryption and developed all the DIGITAL methods.

Glenn and the German had a serious and productive debate, but neither side considered the real alternative to NSA centralization.

The real alternative to centralized banking was fairly common before the digitalization and globalization of the 1970s. It remains common in truly underground circles. The alternative is old-fashioned double entry bookkeeping plus TRUST. Each bank and business keeps its own ledgers, including references to money received and owed to each of its customers and fellow banks. Banks or bank-like businesses RARELY communicate with each other. They may reconcile their mutual debits and credits with official currency once a year. If each has sufficient resources and storage, reconciling can wait as long as necessary.

The supreme example is SCRIP, where value is exchanged by notes or checks that are recognized within the neighborhood. Before globalization, small towns and ethnic neighborhoods were independent in this way. In farm towns most business was done by in-store credit, paid at harvest. When most of the products and services you need are made within the town, and everyone’s trust rating is known, there’s much less need for “hard” official currency, so there’s much less need for reconciling the debits and credits against official currencies and official banks.