Buying Freedom with Alternative Money

Fiat money is evil and must be replaced. The system that governs us does not want people to have the option not to comply with it. It controls us with its money. I hope to encourage readers to reduce their dependence on government issued money through precious metals and cryptocurrencies.

The US dollar officially stopped backing its money with gold in 1971. This decision has been a disaster for our quality of life by every metric.

Without this limiting factor, the government can print money which devalues the existing money people already have. It gives this new money to banks directly and uses it to settle debts with government contractors. These banks and contractors are the friends of those in government (Amazon, Tesla, and others reporting record profits during the pandemic as example). So, through inflation, we effectively remove wealth from the average person and give it to bankers and plutocrats who already own you. Alan Greenspan, 13th chair of the Federal Reserve, described this in his essay Gold and Economic Freedom.

The digital market presents new opportunities for the government to stalk us and control us. While we could anonymously pay in cash before, e-commerce eliminates privacy and enables the production of algorithms designed to know us better than we know ourselves by studying our shopping habits. Privacy tools like VPNs and adblockers do not factor in as domestic espionage records our customer and banking information directly.

Government’s monopoly on money also enables it to exclude anyone or anything from the economy. Russia and her citizens are now banned from doing business with the west. This year we saw truckers in Canada have their assets frozen and money raised to help them stopped from transferring to those who need it. While these are both recent, we have been seeing the banks close accounts and deny merchant services (like payment processors) to dissident organizations, companies, and even individuals for over a decade. These actions effectively bankrupt people hoping to challenge the status quo in our digital era.

Without the system’s evil money, we are better off. We are free to spend our wealth as we want, we are free to do business as we want, we are free from their domestic espionage, and the value of our money is determined by the market instead of decaying in value through inflation.

‘Alternative money’ can be any decentralized currency which competes with fiat. They can be divided into two main categories: cryptocurrencies and precious metals.

Cryptocurrency is a broad category of digital currencies. The most commonly accepted by online storefronts are Bitcoin, Ethereum, and Monero. There are now hundreds of different cryptos and tokens on the market competing for investment dollar, and they all have various pros and cons. Investors tend to be very passionate about their choices and dismissive of competitors in the industry.

Precious metals mainly divide into gold and silver. Silver bugs toting their coins as the “people’s money” must contend with naysayers stacking only gold, which as a commodity has held its value against better inflation than silver has in the last 100 years. The silver bug will shoot back with his belief that silver is artificially suppressed and manipulated by the banks, and that when unleashed will raise in value to its historic price ratio of 8:1 to gold.

These arguments are lively, and the competition is a good thing. In our modern era we have forgotten what it was like for a company to actually care about our business. Those invested in cryptocurrencies and precious metals want you on their team.

The problems alternative money faces is two-fold.

  1. Alternative money is currently a team sport.
  2. Users treat their money as investment, not currency.

Fiat has great advantages over alternative money to the ordinary consumer. It effortlessly translates between digital spending and physical cash. The dollar is accepted everywhere and is usually your only option. For alternative money to pose any threat to fiat, these two issues must be handled.

First, alternative money should no longer be a team sport.

The competition between different flavors of cryptocurrency must be seen as a good thing. Any decentralized cryptocurrency is an ally against government money.

Those exclusively collecting gold or silver over the other should remember that, for the majority of human history, the market operated with a bimetallic or trimetallic system. In the US Coinage Act of 1792, legal weight definitions for copper pennies, silver dollars and gold eagles were simultaneously established to serve as our nation’s money.

Metal is real money. It has been used as currency in society since its inception. It can trade hands anonymously. Testing, purifying, and reshaping silver and gold is trivial with common tools and chemicals.

Metal cannot traverse the Internet. As most commerce is now online, this is a critical roadblock in getting people to adopt metal as money.

Cryptocurrencies can transact globally very quickly, sometimes instantly. Some blockchains are anonymous. There is no space requirements, and millions can be handled with just a phone. Almost all cryptos are decentralized.

Cryptocurrency cannot survive without the Internet, and are vulnerable to specific kinds of attacks.

Those invested in alternative money like to argue these points into very fine detail. I don’t believe supremacy of one over the other is necessary. Our two camps are natural allies. There is no need to choose one over the other.

There is no way to digitize metal without trusting a central authority, such as a government. Platforms like Kinesis exist which do bridge fiat, crypto, and metals together and allow physical redemption for a fee. This is an interesting idea, but as it relies on Kinesis, it is not decentralized as physical metals or cryptocurrencies are.

Conversely, there is no way to make cryptocurrency a physical item. Trinkets which purport to be worth a bitcoin are really just records of a wallet. This wallet is the same as any other wallet, requires a computer to open and verify, and can be emptied remotely without ever touching the trinket.

In a proper doomsday scenario where the Internet is splintered or electricity is scarce, digital currency networks will fail. Monero, as much as I like it, recently had a scare where a single mining pool approached 51% of all mining output. This would have given the managers of that pool total dominance over the record keeping of the Monero blockchain.

There is no way to make physical into digital, or digital into physical, without compromising it in the process. Therefore, we should accept that these two concepts are complementary solutions to the same problem: fiat money.

The Founders defined pennies, dollars, and eagles as measurements of weight for specific metals. It was up to the free market to decide their exchange rate. If we desire to circumvent fiat money and free ourselves from the government’s control, we should tolerate this floating exchange rate and that currency mediums may be better suited for specific purchases.

In the same way that you would likely want to buy a house with gold instead of copper, your digital purchases would be better made with cryptocurrency instead of mailing silver coins.

Second, a critical issue with all alternative moneys is adoption.

Fiat enjoys an adoption rate of almost 100% and most people see no reason to accept anything else besides the dollar.

If you want to preserve your freedom you need to change your behaviors. I encourage you to ask landlords and servicemen who you do business with if they would accept silver or cryptocurrency. If this sounds awkward, it is. That’s OK. This question will stick with them and open dialog to why you prefer not to use fiat. If the same person is asked by different people that same question, they may change their position.

A website which can accept fiat dollars can often easily be made to accept cryptocurrency. It is important that anyone doing business online makes it evident that they do accept alternative money.

I have seen cryptocurrency’s adoption spread but there’s still much more that can be done. Most activity you see with alternative money, particularly cryptocurrency, is speculative. People will hold, not spend, a token or coin expecting its value to go up. Why spend now if it will be worth twice as much soon? Too few people invested in crypto see their crypto as a way to actually buy something from the Internet without using a credit card. If you have crypto and see checkouts accepting crypto, you should reward those merchants for being open to alternative currencies.

Metal faces more hurdles in its adoption. It requires more education to appreciate. It also lacks crypto’s draw of being a speculative emerging technology that has already made many young millionaires. With the attack on small businesses and a general decline of offline commerce, the availability of opening a new physical store at all is intimidating, never mind developing a clientele which pays with or accepts silver. Despite this, there is no harm whatsoever in making it known to your customers or business partners that you are interested in metals as a form of payment.

To rid ourselves of the system’s money, we must be proactive. The more people and companies accepting alternative payments to government controlled money, the looser its grip on us and our lives.

Categorized as Writing