Bitcoin "Lobbyists" and D.C.'s Attempt to Contain the Uncontainable [UPDATED]
Chris Moody at Yahoo! News reports on Bitcoin "lobbyists" or advocates, or as his headline (don't always blame journalists for headlines) puts it, "the people trying to make Bitcoin happen in Washington."
Of course, any true Bitcoin mavens first reaction to that is going to be: Bitcoin doesn't have to happen in Washington. It only has to happen on the blockchain and in individual owners/users (hopefully secure and possibly secret) wallets.
That is the important point about Bitcoin and should be front and centered in any discussion about the politics that haunt and hound the protocol and the cryptocurrency. Still, as I wrote last May, while government can neither make Bitcoin happen nor stop it from happening, it can try to make life difficult and annoying for its users, whether that comes in taxing your profits or arresting you for allegedly using Bitcoin to "launder money."
The piece discusses the Bitcoin Foundation and Jerry Brito, who has written early and often for Reason on Bitcoin issues—see his groundbreaking December 2013 feature on all the ways Bitcoin will likely change the world beyond being an awesome currency.
It also limns a split in the ideological and practical world of Bitcoin I've written about before. As I put it back in April:
between the crypto-anarchists from whom Bitcoin arose and who were its first adopters, and the big-time legitimate businesses stepping in to normalize the market, who would just as soon lose the stink of weirdo anarchism surrounding Bitcoin that can scare off big money.
Moody's story talks of:
an independent San Diego, California-based entrepreneur named Brett Stapper, the founder of Falcon Global Capital, [who in late May] filed paperwork to lobby Congress on cryptocurrency issues. In an interview with Yahoo News, Stapper said he's in the process of coordinating with a law firm—he won't say which—to organize lobby days and post a "practical guide" to Bitcoin online.
"We want to work with regulators. We want to work with governments," Stapper said. "We're not libertarians who see this as a thing that is possible on a massive scale without the help of these organizations."
All the people already using Bitcoin on scales small or massive would choke at hearing this.
[UPDATE: Stapper writes me this morning to say he considers himself to have been misquoted by Moody. He tells me, rather, "I said I am not a radical libertarian who wants to burn government buildings and bring down the banks. Bitcoin will of course operate without the support of government or regulators however, I feel that if we can properly educate them, it will be in the best interest of Bitcoin."]
[Back to original post]
Moody does a good idea getting across exactly how weird and inexplicable Bitcoin likely seems to most old congressfolk—though his lead does a good job pointing out as recently as 40 years ago the way we now use credit cards might have seemed equally far-out—and then hits the reader with a series of questions that might seem very important in Washington but not at all to most Bitcoin users:
For policy and regulatory purposes, Bitcoin's transformative technology blows open a hive of questions. Is it currency? Is it a commodity? Is it property? Will it threaten the almighty dollar? Which agency should regulate it? How should it be taxed? Should vendors that trade bitcoins be treated like banks? Can I accept bitcoins as campaign donations? Is it dangerous? Should we ban it?
Well, it is what it is, to the first three questions. Probably, none, ideally not at all but the community seems able to live with it being taxed as property (as I reported in April), no, yes, no, and no.
Moody closes with a useful summation of some ways the state is recognizing or normalizing Bitcoin:
In May, the Federal Election Commission announced new rules allowing candidates to accept Bitcoin donations. Since then, Texas Republican Rep. Steve Stockman and Colorado Democratic Rep. Jared Polis set up accounts to take donations on their websites. Carl DeMaio, a Republican challenging Democratic incumbent Rep. Scott Peters in California, has directed his campaign to establish a Bitcoin page as well. The Libertarian Party (of course) was the earliest political party to accept such donations.
A month before the FEC announcement, a company that specializes in "Bitcoin ATMs" set up one of its machines in a congressional office building and Polis used it to buy $10 worth of bitcoins as a curious Virginia Republican Rep. Bob Goodlatte, the chairman of the House Judiciary Committee, looked on.
Moody also wraps up with some of the things that are at stake in trying to stymie Bitcoin, in a way that any human of good will should be able to grok:
Washington's Bitcoiners go to great lengths to point to its potential, especially for poor and oppressed people. Bitcoin, they say, has vast potential to revolutionize the way we transfer money and purchase goods and services. In impoverished, rural areas where people lack access to banking institutions, Bitcoin users can send and receive money wherever they can access the Internet on a computer or a phone. (Bitcoiners use the term to describe these people—"the unbanked"—with the same concern a Southern Baptist might have referring to "the unchurched.") For immigrants who need to send money to families in their home countries, Bitcoin would make it easy and relatively cheap.
Bitcoin could also be useful to those living under oppressive government regimes, advocates say, allowing them to support illegal speech or causes without fear of censorship.
And of course it promises to be the Internet's latest way to make us all richer by wiping out middlemen who skim off of transactions, the need for whom the technology obviates:
The growth of Bitcoin could, of course, undermine and disrupt fee-charging money-transferring services such as MoneyGram and Western Union; both are now considering adding a Bitcoin option.
"If I were a company like [that], I would be very afraid," [lobbyist Mary Beth] Stanton, who has advised the Bitcoin Foundation, said.
A worldwide embrace of the Bitcoin protocol could pose serious risk to the remittance and banking industries, which has prompted them to keep a close eye on its development. Last month, a federal lobbyist filing disclosure for MasterCard listed "Bitcoin" as an industry it would focus on.
Bitcoin's famously up and down dollar prices seem to be above $650 again on most exchanges today.
