Are we heading for a Global Bitcoin Standard?
The first thing I did in my old job as a sociology teacher, when I took over as Head of Department, was to introduce a module in Global Development to the department - I just felt this HAD to be the option we studied (rather than religion which was the 'majority option').
The module is essentially asking the question 'why are rich countries rich and poor countries poor' and needless to say the history of Colonialism and Neocolonialism and the role of the IMF, the World Bank and Debt in keeping poor countries poor were (and still are) a BIG part of this course, and having taught it ten times over I'm pretty familiar with this material (still not an expert, there's A LOT of content!)
I was thus VERY interested to hear Max Keiser discuss these issues in a recent interview in relation to El Salvador and (he thinks) other countires in Latin America about to adopt a BitCoin global standard, something he thinks very likely precisely because of the negative experiences in that region with adopting the dollar and its relation to debt-slavery over the past several decades.
You can watch the interview below:
https://www.youtube.com/watch?v=u3PDeuAeuUI
Keiser argues that El Salvador adopting Bitcoin as its standard currency (albeit in parallel with the dollar) is big news, especially since Paraguay has now followed suit. He's envisaging a domino effect in South and central America now - with Guatemala and then Mexico soon to adopt Bitcoin rather than the dollar as their standard too.
His theory is that most of South and Latin America will be keen to ditch the dollar given the legacy of debt-slavery in the region, where lending has been used to impoverish whole populations and extract resources and cheap services to, well, the United States.
He further suggests that the question we should be asking is not 'when will what countries ban Bitcoin', but rather 'when will what countries adopt the Bitcoin standard' - contrasting countries in the global south as being run by dynamic, young entrepreneurs to the 'geriatrics' running the central banks in Europe and America.
Bitcoin is cheap now
Keiser thinks the fact that countries are now lining up to adopt Bitcoin will massively increase the demand for it - as those countries will need to store a certain amount of it to 'settle accounts' - this should also encourage countries to welcome Bitcoin mining, and he thinks China has made a fundamental strategic error banning Bitcoin now, with its own centralised digital currency being no different in essence to any other fiat country, just centralised and about controlling populations.
He likens the price of Bitcoin now to Apple Stock in the 1990s, or Amazon stock in the early days and suggests that there has never really been a good time to sell either of those, and the same is true of Bitcoin...
Outsourcing central banking
This is how Keiser puts what El Salvador is doing - he suggests that governments are generally terrible at managing monetary policy, and so why not outsource it to something decentralised and 'infallible' such as the Bitcoin Network, while governments stick to road building and dealing with the trash.
So is he right? Is now a good time to stack Bitcoin?
I'm inclined to agree, I do feel like we're at a pivotal moment in geo-politics where all of America, China, Russia and Europe are on the wane, though they may be in denial of it.
This seems especially obvious where their monetary policies are concerned - with America and Europe printing funds like there is no tomorrow, and China banning Bitcoin, which is probably because they see it as a genuine threat to their control of their territory.
Russia meanwhile has sold all of its dollars, and there are plenty of developing countries out there who will probably be sceptical about using the dollar as a store of value as they grow their GDPs, especially given the history of debt-slavery related to the dollar.
And Bitcoin has hardly disappeared, has it, it may have dropped from $60K down to $30K, but it's holding that level, and if entire countries are about to start ditching the dollar buying to Bitcoin and driving up the hash rate, that could be huge news for its price.
I am certainly going to look at accumulating more BTC in the coming weeks and months, now I'm done stacking my stable coins, enough with that for now!
I had no idea Max Keiser did this sort of analysis
I've heard the name before, but TBH I had no idea that Max Keiser is a critical economic pundit who has been criticising fiat money and central banks since before Bitcoin, which is also something I've been doing - so I'm going to have a deeper dive into what he's been saying.
I'm not convinced about his price predictions, but I do think there's something in this geopolitical analysis in the context of the history of global debt.
I guess his answer to 'why Bitcoin' (rather than ETH) for example is the Proof of Work difficulty of mining and the scarcity of a hard capped limited supply.
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