Encryption may end up being the biggest trend in 2013, as the concept, usage and term itself move from the realm of computer geeks and hackers into mainstream consciousness. The reason why such a moment must occur relates to the fact that governments and intelligence agencies the world over are rapidly moving in the direction of spying on their citizenry twenty four hours a day, seven days a week. Those of us that don’t like this privacy invasion will have to move toward encrypting as much of our daily lives as possible. In the world of money, Bitcoin has emerged as the most popular alternative currency in existence today, and is likely to only become exponentially more popular due to its substantial anonymity (relative to fiat currencies) thanks to encryption.
Of course, encryption doesn’t stop with crypto-currencies. It is in this regard that Kim Dotcom (born in Germany, residing in New Zealand and originally named Kim Schmitz) could lead the charge. Encrypted email is one of his solutions.
While his new site Mega already has 3 million users since its launch in January, where Kim could really make a massive difference for the billions on this planet that use email is through an encryption service for the masses. While nobody likes it, everyone pretty much assumes that some bureaucrat or petty intelligence official with nothing better to do with their lives has access to every email you write. But does life really have to be this way? Kim Dotcom says no.
The irony of the U.S. government’s case against Kim is that they accuse him of essentially providing the infrastructure for people to pirate movies, while at the same time they claim the right to spy on their citizens without a warrant. Why is the U.S. government so obsessed with Hollywood’s intellectual property rights but not the right of its citizens to privacy? As Kim Dotcom states:
“If files are your property, then the U.S. government has taken millions of people’s property without warning or legal standing.”
The complete hypocrisy of the U.S. government will simply be exposed more and more everyday until their arguments ultimately fall apart in pile of lies. In the meantime…we have encryption.
For coverage on Kim Dotcom’s recent chat at South by Southwest check out this article from NBC in which they call him the “anti-Zuckerberg” and this one from Wired.
In Liberty,
Mike
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If Kim’s email setup required a micropayment in Bitcoin per email we would have spam free email and cement bitcoin into the world’s economy.
There’s a new game in town. Instead of the oft-repeated idea that “Only those with something to hide complain about surveillance” maybe we should try a new one:
“Only those that pry will complain if I keep things encrypted”
Its not the US government, it is the ruling class they answer to.
Hypocrisy also lies in bitcoin. Bitcoin has no backing. In this regard it’s no different than Federal Reserve notes. Money by definition requires physical backing, not some concept in the ether such as privacy or confidence. Even Max Keiser says money requires backing with intrinsic value. There is nothing intrinsic about privacy.
The supply of privacy (as advocated by Max Keiser) and confidence (in bitcoin & gov’t for Fed notes) is infinite. Privacy and confidence are concepts that can be created out of thin air. One does not create gold & silver out of thin air.
So bitcoin is fiat, lacking gov’t decree. Fiat currency can be created by anyone, not just gov’t. Mike Maloney & James Turk have both explained that the difference between money & currency is that money has physical backing. Conceptual backing such as privacy & confidence are just vapor. They can be created infinitely. And they can disappear just as easily.
This is simply incorrect. Fiat is defined by government backing. The definition is:
fi·at
/ˈfēät/
Noun
A formal authorization or proposition; a decree.
An arbitrary order.
So Bitcoin is 100% not fiat, unless you have your own definition you created. You make a good point on intrinsic value and I don’t disagree. This is where gold and silver are better than Bitcoin, but if you ever used Bitcoin you’d see it is MUCH more like gold and silver than govt. currency.
I am constantly fascinated by what people mean by the words they use and also constantly shocked at how worked up people get in arguments about the definition of this or that term or concept when it is patently obvious that any pair of us can mean something radically different when using the same term.
In the context of this never-ending argument about the precious metals (of which I am a big proponent), I wonder what people mean when they say “intrinsic value”. Because even though I personally value the PM’s more highly than their current price in fiat currency, I don’t see in them what I would call “intrinsic” value. To me the word intrinsic implies that there is some value that inheres in an object independently of anyone’s subjective opinion or authoritarian decree.
So for example, I might impute intrinsic value to oil because no matter what anyone thinks or says about it, you can burn it to do useful work. Same goes for food, potable water, clean air, etc.
I don’t see how gold measures up against those kind of items in terms of the word “intrinsic”. To me, gold has value for conventional, historical, and subjective reasons. Essentially, it has value because humans value it (and have done for millenia).
In this way, gold is no different to me from bitcoin which I believe has value insofar as humans value it. And in both cases, I believe, their value in large part rests on the fact that nobody can create them out of thin air without expending work (notwithstanding for the moment, paper gold manufactured out of thin air by naked shorting, and the possibility of compromising the bitcoin protocol to create counterfeit bitcoins).
PJ
Your comments are spot on. Gold is just a shiny metal with little use value. If you are a hunter on the North American continent in the year 1300 would you trade your obsidian arrow heads for a soft metal that would just bounce off your targets’ ribs?
Is the open source bitcoin protocol the source of vulnerability? I don’t think so. Fiat currencies exist because people believe they serve as placeholders for things of real utility value. That belief is created by the power of the state that issues them. That power rests upon the ability to define reality as belief systems and also upon brute force to demand tribute to the state in the form of payments in the state fiat currency.
It follows that when the state feels threatened by an alternative currency it will define it as illegal and use all means necessary to destroy it. In the case of bitcoin, it is difficult to control peer-to-peer exchanges for use value, but the state central banks can destroy it at will by imposing draconian penalties at the point of conversion when the attempt is made to convert bitcoin into the fiat currency that the state has the power to demand as tribute from its citizens.