The recent news of major banks closing their doors to crypto-friendly customers has been a major blow to the crypto community. Governments around the world have been attacking Bitcoin and other cryptocurrencies with regulation, attempting to close off on and off ramps and make it difficult for people to use digital currencies.
But tonight, I had an epiphany. What if, instead of being a death knell for Bitcoin, this regulation actually led to its adoption?
Think about it. If governments around the world are regulating Bitcoin, it means they are taking it seriously. They are recognizing it as a legitimate form of currency and are willing to put in the effort to make sure it is used responsibly. This could lead to more people feeling comfortable using Bitcoin, as they know it is being regulated and monitored.
Furthermore, if governments are regulating Bitcoin, it could lead to more businesses accepting it as a form of payment. This could open up a whole new world of possibilities for people who want to use Bitcoin to purchase goods and services.
Finally, if governments are regulating Bitcoin, it could lead to more investment in the cryptocurrency. This could lead to more people buying and holding Bitcoin, which could lead to an increase in its value.
So, while it may seem like a bad thing that governments are attacking Bitcoin with regulation, it could actually be a blessing in disguise. It could lead to more people using Bitcoin, more businesses accepting it, and more investment in the cryptocurrency.
So, instead of worrying about the major disruptions and closures of crypto-friendly banks, let’s focus on the potential positives that could come from government regulation. It could be the key to unlocking the true potential of Bitcoin.
3 thoughts on “?What if Major Regulation Led to Adoption: Reflections on the Disruptions and Closures of “Crypto Friendly” Banks and Governments’ Attacks on Bitcoin”
Correct. This has always essentially been the end-game use-case for bitcoin.
As catchy as the phrase “be your own bank” is…this was never about saving peace-time first-worlders from evil checking overdraft fees, or trying to compete with Visa or Western Union in mere ease of payments and remittances.
Bitcoin was always primarily *anti-state* technology. Modern banks of course are an arm of the modern state and so bitcoin importantly disrupts centralized banking. But banks writ large can and have been perfectly at home with market-based monies in the past. The modern state, however, can’t survive without direct control over the money and the money supply.
We only really see bitcoin provide what most people would call utility, right now, under the most dysfunctional states; where people are empowered to escape with their lives and their wealth, avoid draconian capital controls or avoid the worst of hyperinflation.
But those things appear to be rapidly coming to the western, developed countries; and it will suddenly make sense to the masses; when their misplaced faith in the state is shattered; why bitcoin exists and why it’s lack of regulatory compliance, or dollar-level stability, or central bank management never mattered, and are in fact, features.
Most bitcoiners even, still somehow dont realize that the primary thing holding back the adoption and use of bitcoin as an everyday spending/earning money (and thus its development into more stable, unit-of-account type of money) has been the existing regulations, like the tax treatment (which de facto prohibits anyone from being able to use it as money because it’s impractical to comply with the tracking and reporting necessary), and the aml/kyc/banking regs applied to *anyone* acting as a fiat on/off ramp, ensuring that there’s nothing to do with crypto except speculatively gamble on giant centralized casinos. I don’t think many people here seem to realize that before the IRS’s ruling on crypto was released in 2014, we had pretty substantial transaction loops developing, and before the banking regs were applied to all sellers as MSB’s, thriving peer-to-peer OTC markets were a viable way to buy and sell bitcoin for all but the largest institutional buyers and sellers.
Those unintended consequences, which have shaped and limited the crypto ecosystem far more than anything else thus far; virtually disappear the moment that the masses no longer care to comply with the government and are more concerned about preserving the last scraps of their wealth *from* government.
Something that is missed in the general conversation is that Bitcoin is *actually useful.*
Something generally overlooked is that the fiats are outlawing and KYCing themselves out of a job.
All is going as Satoshi has planned.
That’s exactly it. The only thing USG cannot stop is Bitcoin. It’s too late. Why fight an unwinnable battle when you can work together and conquer? Consider that as long as access in and out of BTC is going to eventually be one of the most heavily KYC’d via an international standardization.
All, every movement of BTC will be tracked and holders will be identified. Meanwhile, other currencies (defined as securities) will be blocked by banks.
This is incredibly interesting as a strategy considering this is an international effort. We’re not even talking about ISO20022, Fednow or CBDCs yet…
it sure would be an excellent way to remove countries off the “new financial ecosystems” thereby making theirs obsolete.
tl;dr something wild is going on, and BTC will be a part of it,