Operation Saylor - Episode 15/120
Hi again and welcome to another episode of the Operation Saylor. This is update number 15, corresponding to September 2023.
If you are reading this for first time, you might want to check Episode 1, where my plan and details are explained. That will get you in context.
Stats
- BTC stack: 1.38666794 BTC
- € stack: 23.20 €
- Current total value in €: 33,996.56 €
- € into BTC: 30,000 €
- Paid back to bank: 5,126.80 €
- Outstanding debt + interests: 38,817.53 €
- Installments to go: 106
Charts
Log
Another month, another episode.
This past month I've been putting some thought into one of the many doomsday scenarios we can face in bitcoin. One of my greatest concerns with bitcoin is the following situation. Imagine you live in a country where, in a swift karate-like movement, government goes strongly authoritarian and quickly: (1) deprecates physical cash, (2) deploys a CBDC and (3) goes hardcore on KYC, reporting every tiny thing and crunching the free movement of money (“What's this $20 that you just sent to Bob, Alice? You need to pay taxes on it. The funds will be withheld until you provide a proper explanation. Thanks for helping us in our fight against terrorism and climate change.”).
If this happens, exchanging Fiat and Bitcoin would probably become a very challenging task. Without cash, you can't simply do face to face trades. With a heavily monitored digital banking environment, you might not be able to use platforms like Bisq, Peach or Robosats since you might not be able to justify fiat transfers. And when it comes to CEXs, well, in such a dystopian environment I would count on them having been blown away completely. There will always be loopholes, and there will always be a way, but this could introduce a friction in the exchange of Fiat and Bitcoin the like of we have never witnessed.
Now, all of these are only challenges to exchanging Fiat and Bitcoin, not to move Bitcoin itself. We would still be completely capable of sending Bitcoin, and I have no reason to think that the network wouldn't hold strong. But, how useful would that be?
Ideally, the world should head to an economy where people exchange goods and services for Bitcoin. The thought of Bitcoin as something that is “bought” would fade away, as people would simply earn and spend it. The idea that Bitcoin is an investment would also become a thing of the past, and a P2P free market without forced-upon intermediation would flourish. We would eventually even use it as a unit of account, and we would all live happily ever after. After all, Bitcoin will fix everything there is to fix, won't it?
I don't know how things look around you, but in my action radius, we are very far away from this free trade utopia. The truth is, when other bitcoiners come to visit my town, I can't recommend them any accommodation that takes bitcoin, barely any restaurants, no transportation at all, etc. There are a few local businesses that do take bitcoin, and I am optimistic because the trend is going up, not down. But it would be dishonest to label the local bitcoin-commerce offering anything else than a cute joke.
So, you've been stacking for years, and all of a sudden you have no on ramps and no serious options for spending your Bitcoin. That's one way to royally screw up, and is a concern I regularly feel in people from my community who feel tempted to buy through CEXs instead of P2P. They don't want to find themselves sitting on a future stash that they can't spend properly. In my opinion, is a valid concern. Those of us who are in for the revolution might be willing to do bigger sacrifices or take more risks, but I wouldn't expect the layman to be in the down for it. Which makes this concern an obstacle for many normies to increase the weight of their bitcoin stack in their net worth.
Thankfully, all of this is a hypothetical scenario in my mind that we might never face with such strength and drama as I am describing. Nevertheless, I think it is a realistic possibility, which drives me to the final part of my rant: what can we do to prevent this? The good news is I feel we have many ways to help here.
The first one, which is dramatically simple and powerful, is to use cash. The more cash is used, the more friction authoritarian governments will face to ban or restrict it. Ideally, we should have people live almost entirely on cash, because these people will be the first ones to fight back with teeth and claws regulations against it. It's a simple gesture that anyone can include in the daily life, and it comes with benefits for everyone. It hurts me deeply when I see bitcoiners pulling credit cards out of their wallets when they could be using cash.
The second one, which is also simple, is to accept bitcoin as payment when offering goods and services. Listing your bicycle on Craigslist? Offering your graphic design services? Selling meat in a market? Why not accept bitcoin if you are already a bitcoiner? This area might get a bit more muddy with taxes, employees, and similar things, but you still probably some low-hanging fruit opportunities to at least low-key accept it here and there.
The third one is to support businesses that accept bitcoin already. I go out of my way to find and use merchants that accept bitcoin. I'm willing to accept lower quality, higher prices and other pains just to support them and help them stick around. Because it is in my best interest that they survive: one day I might truly need them to be there if fiat alternatives are not usable for any dystopian reason.
Developing a free, private market that trades in bitcoin won't be easy and won't happen overnight. Neither will be to push back against CBDCs. But, what can we do but try? And, to generate a bit of FOMO and close this episode on an optimistic note, remember the exponential nature of this growth. When there is only one store in your town that takes bitcoin, the trade volume will be a joke. When there are a few, trade volume will pick up a bit, and you might find merchants buying things from each other and using bitcoin. If dozens and hundreds start to appear…
As always, thanks for reading and see you around next month.