Cryptocurrencies

The Best Way for Florida to 'Take on Big Tech' Is to Keep Welcoming the Crypto Community

Platform censorship results from centralized design. Cryptocurrency techies are building decentralized alternatives.

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If you want to build cryptocurrency applications, there are few better places to be than Miami these days. Set aside the great weather and established financial industry for a moment. By moving to Florida, fintech firms can not only enjoy the benefits of a custom-built regulatory sandbox and low, low income tax rate of zero percent (among other pro-growth economic policies). They also have a cryptocurrency champion to boot in the form of Bitcoin-loving Miami Mayor Frances Suarez.

Suarez has generated quite the buzz for his forward-looking proposals to allow Bitcoin payments for municipal employee salaries, fees, taxes. His office is exploring ways to put part of the city reserves in cryptocurrency, too. And Miami was the first city government to host the full Bitcoin white paper on its official website in solidarity with the community's movement against the abuse of copyright laws.

Having political leadership so welcoming to new technology is a great sign that innovation is safe here. Compare this posture to some of the rhetoric and laws flowing from governments in Silicon Valley. No wonder techies are fleeing California. The New York finance guys are right behind them. It's still early, but we shouldn't be surprised to see these refugees heed Florida's friendly call. Many are flocking here for the industry's biggest Bitcoin conference in Miami in June. They might just decide to stick around.

But Miami isn't the only den of cryptocurrency activity in Florida. Actually, the Sunshine State has pioneered Bitcoin in many ways.

Jacksonville was the site of the first real life purchase of goods for Bitcoin in 2010: the infamous 10,000 BTC pizza. Jacksonville is another banking hub, so it's great to see Mayor Lenny Curry collaborating with Suarez on how to bring more Bitcoin business to Florida. My own city, Pensacola, has been home to Satoshi's Forest since 2013, which was one of the first charity groups to use and promote Bitcoin. And my hometown, the Tampa Bay area, hosted the St. Petersburg Bitcoin Bowl in 2014.

It is fantastic to see leaders in Florida embrace the promise of cryptocurrency. Legislators want to build on the momentum of Florida's fintech sandbox and new Digital Service by updating our money transmission rules to attract even more cryptocurrency activity. Florida, in general, has been very open to technology and innovation.

This does not mean that our leadership is a big fan of "Big Tech." Our Republican-run government representatives have been pretty vocal about their problems with the management of popular social media platforms, particularly when it comes to content controls.

Last month, rhetoric ratcheted up to proposed legislation in the form of two bills aimed at reining in big technology companies through new data privacy and content moderation regulations.

Although cloaked in Republican messaging about Silicon Valley run amok, the privacy bill itself is in line with other state data privacy laws such as the California Consumer Privacy Act and Washington Privacy Act. It outlines how large companies and specialized data brokers must inform users of their data policies, allows users to request and review their stored data, and creates a new cause of action for users who find their data being used in ways contrary to stated company terms. It wouldn't give everyone "privacy" online, but it's pretty vanilla as far as tech policy goes.

More assertive is the "Transparency in Technology Act," which as of the time of this writing is not available in full text but rather as a bulleted list of legislative goals. A press release from Governor Ron DeSantis says the measure would require companies to "publish standards used to ban posts, de-platform and shadow ban users," "provide equal access for established news organizations and qualified political candidates to reach users free from manipulation by algorithms," "stop arbitrarily censoring and/or deplatforming users," "give users the power to opt out of algorithms," and "stop frequent changes to terms of use, clearly communicate and obtain prior consent to changes."

Policy proposals to control content moderation decisions are usually either legally or logistically unworkable—left-leaning leaders and activists often to exert soft power against platforms to promote their moderation goals partly for this reason. But when it comes to the constitutionality of the measure, UCLA law professor Eugene Volokh reports that the Florida content control controls might be on firmer legal ground than you'd think.

This is a separate question from enforceability. Just last week, Facebook made the dramatic decision to cut off Australian news links from being posted to their website rather than pay a proposed tax for media outlets. If platforms decide they'd rather not play by these content moderation rules, they can take their ball and go home. For all the complaining that people do about social media, they often stay on the platforms. They would probably be pretty upset if Facebook cut off Florida in response to this law.

It's not that the problems such measures aim to address aren't real. Major social media platforms are designed so that the central administrator has complete discretion over what we can see and do on their platforms. Typically, if you don't like how a service provider operates in a market, you can leave and pick another. There are lots of social media platforms, after all. The problem is that these central administrators can be targeted by powerful bodies to control content. A culture of mono-moderation has emerged from this that doesn't allow much real user choice. As the Parler debacle illustrates, if alternative platforms do not exercise their discretion in the way that pleases other upstream providers, they too can be cut off.

We can't ignore the political dimension. Florida is a Republican state that voted for Trump by a healthy margin. Many Florida voters are alarmed by what they saw as a coordinated media and platform campaign to censor or bury stories unflattering to the Biden campaign. Of course they expect their leaders to "do something," especially when those leaders are quickly ascending to national prominence and perhaps presidential ambitions. Besides, it's not like Democrats aren't doing the same exact thing to try to legally force platforms to moderate content in the way they would prefer.

But the problem of platform censorship is not at core a policy problem. It is a technological problem, as Reason senior producer Zach Weissmueller's fantastic video "How to Fight Deplatforming: Decentralize" well illustrates.

Because big online platforms are centralized, they will be targeted by powerful groups to influence how the content is controlled. Any political solution that cements or neglects the core problem of centralization will not capably address the deplatforming problem.

So what can lawmakers who are concerned about the power of social media platforms do? Well, in the Sunshine State, we should just do more of what we're already doing and create a hospitable environment for the people who are building decentralized technologies.

It might look like Florida's embrace of cryptocurrency and distain for big tech platforms is a contradiction. Actually, it makes perfect sense. Decentralized technologies like cryptocurrency provide an alternative to the more centralized arrangements that have until now dominated the internet.

Many cryptocurrency projects seek to deal with the deplatforming project head on. One great example is LBRY, which is a blockchain-based and censorship-resistant YouTube alternative. Anyone can upload their videos to the LBRY blockchain, which is accessible by explorers like Odysee that third parties build to let users connect with content. No one can censor the LBRY blockchain, but applications like Odysee can set their own content standards for what users can access. Don't like Odysee's standards? Use or build a competitor. This model allows for both censorship-resistance at the blockchain layer and diversity in content moderation at the application layer.

Politicians that are upset at content moderation standards shouldn't waste their time on quixotic efforts to micromanage platform policy that will probably be outweighed by stronger efforts on the left anyway. They would better achieve their goals by creating an environment where such decentralized technologies can make that old model irrelevant.

As the futurist Buckminster Fuller once remarked, "You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete." Trying to legislate a content moderation policy that is more hospitable to dissident voices is merely fighting the existing reality. Creating an environment where techies can build these new decentralizing tools is how we make centralized platforms obsolete—or at the very least, just one of many viable options.

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  1. No mention of the biggest enemy of both the crypto community and pro-freedom citizens, the DC establishment.

    Joe Biden and Co (The people Reason promoted the past four years) are trying to destroy freedoms both digitally and physically. Shut down, crypto and shut down small business.

    I guess it’s a tough pill for Reason to swallow that red states are now the beacon of freedom and the only semblance of libertarianism that remains in this country.

    No refunds.

    1. Can we really allow Bitcoin to be used commonly when it costs so much energy to run the computations? Also, isn’t there a racial bias in the Bitcoin community? Where are all the Black people who own Bitcoin? Janet Yellen needs to investigate these serious issues in the crypto-community.

      1. What of the Bitcoin miners? Do they have decent working conditions? Are they making a living wage?

        1. I know of at least two guys who got black lung from the Bitcoin mines. Terrible illness, terminal too.

          1. Black Lungs Matter!

      2. “Where are all the Black people who own Bitcoin?”

        I know you’re having fun here but there’s legitimate black crypto movements. Hotep Jesus being a major promoter.

        Both blacks and whites want to leave the plantation.

  2. Florida gonna Florida. #Pourlando

  3. You can write and distribute software anywhere there is a computer and internet connection. I don’t see any compelling reason to go to Florida to do so. Those who contribute to Linux or participate in the bittorrent networks are spread across the globe. What purpose would be served by gathering them together in Florida?

    1. For the Bitcoinvention – Daytona edition of Girls Gone Wild?

    2. Taxes
      freedom of movement
      cheaper energy
      favorable regulations
      cheaper housing

      1. You don’t need to pay taxes or move around to write and distribute software. To pay for the electricity to do so is not expensive. You can operate a computer without a license anywhere in the US and cheap housing is an option in every state, many with more temperate climates.

    3. The same purpose that made Silicon Valley a viable hub. And that made Detroit into Motor City. Any industry tends to cluster because like-minded people want to hang out even outside of work. They share ideas over a beer, spin off new companies, switch jobs and do all sorts of Schumpeterian creative destruction. While all that’s theoretically possible in a 100%-remote environment, it just happens faster with a real-world presence.

      1. “The same purpose that made Silicon Valley a viable hub.”

        What made Silicon Valley was Stanford University and a number of companies that made hardware. Detroit was also about hardware – cars and the things that go into them. I’m talking about software, something that shares little with physical objects.

        As far as Florida universities are concerned, I don’t think any of them pack the same punch as Stanford etc. I have an acquaintance who went to Florida to study computer animation so they have to be doing something right in at least one area of high tech education.

  4. Oh, well, as long as crypto keeps safe and private, I don’t have any problem. At https://demyo.com/, I discovered these two things are essential to cryptocurrency.

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