Bill Foster, co-chairmen of the blockchain caucus, is out of sync with cypherpunks values and our fourth amendment right to privacy in his recent suggestions on how to regulate cryptocurrency. The United States has gone down a swirling funnel toward monetary surveillance, where policy makers now look at currency as a crime fighting tool.
The Bank Secrecy Act, the Patriot Act, and the Anti Money Laundering Act all work in tandem giving our government authority to essentially spy on our financial lives, which borders on violating our fourth amendment right to privacy. Cryptocurrencies present the biggest dilemma for politicians who have succumb to the belief that governments should be able to monitor our financial activity for the sake of public safety.
“There’s a significant sentiment, increasing sentiment, in Congress that if you’re participating in an anonymous crypto transaction that you’re a de facto participant in a criminal conspiracy.”
Sounds to me like he is claiming that anonymous users of cryptocurrencies are guilty before proven innocent. Another blatant disregard for our sixth amendment right to due process.
We all have our peeves that we may or may not want to reveal to others. We’re all on our own path of growth so to speak. Our motivations for privacy are generally not to cover up some nefarious activity, as the congressman suggests; rather, it could be for a secret gift to give, a collaboration best kept private for the circumstances surrounding the matter at hand. There are countless innocent reasons and scenarios where our privacy needs to be respected.
And this applies to our financial privacy as well. It is our business whether to reveal a transaction to a third-party or not. If I don’t want a person or persons at a bank, or any institution for that matter, knowing how much I sent and to who, why should they be privy to that information if it is unnecessary? Our money, our wallets—governments and banks don’t need to infiltrate that information for their own detective purposes. There are plenty of other ways to catch criminals. The CIA, FBI and other government agencies around the world have plenty of advanced technologies to seek out and catch bad actors, cryptocurrency doesn’t have to be one them.
But Foster suggests otherwise: by having courts have access to a “heavily guarded key”, institutions could thereupon reverse transactions. This calls into question his respect for the values of the crypto community.
It also implies giving up a portion of your ownership of the crypto. If you are not the sole holder of your private key, you do not 100% own your crypto. Essentially, this means the government will act as a third-party in the transaction, even if it just for the potential to monitor the activity. And even if Foster’s intentions are for our public safety, I don’t believe he is weighing the full impacts of the power imbalances currently imbedded in our system, and the imbalances that would be created by the regulations that he is suggesting.
In fact, what he is suggesting would flip the whole concept of peer-to-peer transactions on its head. If governments hold some sort of master key, they thereby have authority over the network. The network would thus become a centralized network.
Crypto is a means toward individual sovereignty; it gives us the ability to conduct our business affairs without the intrusion of a third-party. This is what unlocks all the productivity enhancements that crypto has to offer. No third-party, no fee collector, no trolls under the bridge governing our financial affairs.
Maybe the third-party was a necessary factor in the past, but with blockchains—it is not. Old world surveillance capitalism by way of government is trying to hold onto the tools that make the financial monitoring of our humanity possible. But it’s no longer necessary, in fact—it may even be outright authoritarian.
If London Bridge is falling, do we blame the hammers that built the bridge for the fall? No, so why should blame cryptocurrencies for the nefarious activities of criminals? Yes, maybe money won’t be a tool anymore to catch criminals, but that was never what money was intended for. Let’s stick to our constitutional rights and the values of our founders and avoid the legislation Foster is proposing.