The Breakdown - Is there Danger in Politicizing Crypto?

Episode Date: July 1, 2024

A reading and discussion inspired by: https://blockworks.co/news/bitcoin-right-left-politics-neutral Enjoying this content? SUBSCRIBE to the Podcast: https://pod.link/1438693620 Watch on YouTube: https://www.youtube.com/nathanielwhittemorecrypto Subscribe to the newsletter: https://breakdown.beehiiv.com/ Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW

Welcome back to The Breakdown with me, NLW. It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world. What's going on, guys? It is Sunday, June 30th, and that means it's time for Long Reads Sunday. Before we get into that, however, if you are enjoying the breakdown, please go subscribe to it, give it a rating, give it a review, or if you want to dive deeper into the conversation, come join us on the Breakers Discord. You can find a link in the show notes or go to bit.ly slash breakdown pod. Hello, friends. end. Given that all the hullabaloo this week was about whether Donald Trump and Joe Biden would

talk about Bitcoin or crypto during the debates, which of course we know didn't happen, it seems only appropriate that we read a piece about Bitcoin and crypto and its political implications. The piece is by Elliot David and is called Bitcoin isn't right or left. It's forward. Elliot writes, Bitcoin and crypto were quickly becoming a campaign issue in the 2024 election. And so we now find ourselves at a critical juncture where Bitcoin could either become a bipartisan an issue or fall victim to the pitfalls of hyperpoliticization. Writing about the politics of Bitcoin, I think it is only fair to identify myself as a progressive, even though I have worked for both President Clinton at his Foundation's Islands Energy Program and President Trump at the U.S. Department

of Energy. Through my work, I've come to understand that Bitcoin has intrinsic value for everyone, regardless of political affiliation. Today, however, the challenge lies in ensuring that Bitcoin's potential isn't overshadowed by political maneuvering. Recently, President Trump has incorporated a pro-Bitcoin stance into his stump speeches, signaling a notable shift in his political strategy. Now reports suggest that President Biden is also engaging with crypto stakeholders in order to explore how he too can appeal to the burgeoning Bitcoin and crypto-enthusiast community. This newfound political interest from both ends of the spectrum presents a unique opportunity and a significant risk. Bitcoin is a neutral technology, much like the Internet. It holds immense

potential to reshape our financial systems, offering a permissionless and open monetary system. However, its future depends heavily on how we craft policy around it, and more crucially, how it is perceived by people across the ideological spectrum. This policymaking process should be inclusive, measured and aimed at unlocking Bitcoin's potential for all, rather than being swayed by the political wins of the moment. I believe that Bitcoin can either help unify our politics or become another battleground. Thought leaders in the Bitcoin and Crypto Space have voiced concerns over the current administration's anti-industry stance. They argue that the clear moves by the administration to stymie Bitcoin and crypto in the U.S., like by vetoing the bipartisan Fit 21 bill make

engagement fruitless. While these concerns are valid, it is crucial to recognize the danger of imbuing Bitcoin with political ideologies. Doing so risks alienating a significant portion of the population, namely progressives in those identifying on the left, who might otherwise find value in this technology. Instead, Bitcoin advocates should strive to keep the technology's inherently neutral stance, focusing on its potential benefits across the political spectrum. Bitcoin adoption is not just inevitable, it is essential, but rushing to embrace any candidate who offers superficial support for Bitcoin without a thoughtful and inclusive approach can lead to short-sighted policies that may hinder its long-term potential.

Instead, a slow, deliberate, and inclusive policymaking process will better serve Bitcoin's growth and integration into our financial systems. Hello, friends. Before we get back to the rest of the show, I want you to join me at Permissionless. Permissionless is a conference for Cryptonatives by CryptoNatives. And the reason it's so important this year

is that despite regulators' best attempts to push industry founders, devs and executives out of the U.S., the U.S. remains the beating heart of crypto. Today, the tide is turning. Policymakers have pivoted from fighting crypto to embracing it, which will lead to the creation of new financial products, new applications, and ultimately new adoption. Permissionless is a conference for those using and building on-chain products. It's home to the power users, the devs, and the builders.

And what's more, I'm going to be there. The location is Salt Lake City. The dates are October 9th to the 11th, and right now, tickets are just $199. Towards the end of the month, they are going up to $499, and if you want 10% off, use code breakdown 10 when you check out. If you go to the Blockworks website, blockworks.com, there will be lots of information about how to register, and again, use code breakdown 10 to get 10% off. We must also remember that policy is not inherently an existential threat to Bitcoin. Rather, it is a social adoption of Bitcoin that will define its future. If we truly believe in Bitcoin as a revolutionary financial system,

we must strive to make it inclusive. This means reaching out to historically excluded groups such as women and youth to ensure they feel welcome in the Bitcoin community. Building a diverse and inclusive Bitcoin ecosystem will help foster broader acceptance and integration, making the technology more resilient and robust. In my role with a sustainable Bitcoin protocol, a global initiative focused on bridging transparency and sustainability to the Bitcoin mining industry, I see firsthand the importance of responsible and inclusive approaches to technology. Our efforts to prove the sustainability and positive impact of Bitcoin mining are part of a broader movement to ensure that Bitcoin's growth benefits everyone, not just a select few. The climate movement serves as a poignant

example of how crucial issues can become gate-kept bipartisan divides, undermining collective actions. Some conservatives and right-leaning individuals perceive climate change efforts as intrinsically tied to liberal agendas. In part, this is a deliberate politicization that is complicated bipartisan success, despite the shared threat posed by climate inaction. This polarization stymies progress on what should be a consensus in bipartisan effort, though we may disagree on exactly what solutions to implement. In the context of Bitcoin, we must avoid a similar fate. By maintaining its neutrality and fostering inclusive bipartisan dialogue,

we can ensure that Bitcoin's transformative potential benefits everyone, transcending political boundaries. By educating the public and fostering a deeper understanding of Bitcoin, we can help demystify the technology and build a more informed and inclusive community. Recent initiatives like the Bitcoin Voter Project, which aims to support education and awareness about Bitcoin, are crucial examples in this regard. As we navigate this pivotal moment, it is imperative to avoid the trap of politicizing Bitcoin. Instead, we should focus on its potential to bring positive changes to our financial systems. This requires a bipartisan approach, one that values thoughtful policymaking over political expediency. We should remember that politicizing Bitcoin is like putting a party flag

on the moon. It's a disservice to its universal potential. The future of Bitcoin hinges on our ability to ignore our impulses and desire for our tribes to win and follow the better angels of our nature in order to transcend political divides. We must be wary of politicians who offer superficial support without a genuine commitment to inclusive and sustainable growth. Bitcoin is more than just a technology. It is a movement towards a more open and equitable financial system. Let us ensure that this movement is not co-opted by partisan politics, but remains a beacon of hope and progress for all. Bitcoin isn't about left or right. It's about forward. All right, back to NLW here. First of all, I'm in broad agreement with Elliot here that Bitcoin

is inherently a big tent issue and that its benefits have basically nothing to do with the politics of the people who are pushing it one way or another. I think unfortunately, for the progressive wing of the Bitcoin movement, there has basically been an ever-shinking space. For a long time, Bitcoin held out as one of the least partisan issues that was discussed in Washington, D.C. As someone who has covered this industry every single day for the last seven years or more, the reality is that that didn't change when Donald Trump got involved. That changed when Elizabeth Warren decided to start the anti-crypto army, when the FDIC decided to start Operation Chokepoint 2.0.

It was politicized antagonistically in the wake of the FTX collapse. Trump is a political animal and is responding to an opening that he saw, and he's been very successful in doing so. We've talked frequently on this show about the concern that many have. have, that his support might be only expediency, but for many people, even who recognize that critique, it simply doesn't matter when the other choice is an outright denial of the ability of the industry to survive. The contrast between a 30% mining excise tax proposed by the Biden administration and former President Trump engaging with Bitcoin mining organizations is hard to draw

equivalence between. The good news is that if you look on a congressional level, Bitcoin's leading advocates, even on the right, are not trying to turn it into a Republican-only issue. GOP whip Tom Emmer has been explicit about this, saying that Bitcoin shouldn't become a partisan issue like this. What's more, you have a significant number of Democrats who have risen up and who have made it clear that they are unwilling to cede this to partisanship. In other words, the response to Trump getting engaged is actually, I think, so far, been to create more of a platform for bipartisanship as counterintuitive as that seems.

Again, this is not to deny any of the objectives that Elliott paints here. I just think that in practice, it's working in some. very strange ways. At the end of the day, Bitcoin is money for enemies and truly does not care about the politics of its users. That creates an incredibly powerful base to get beyond short-term partisan politics, and I am confident that we will. Bing thanks to Elliot for putting his voice out there for sharing this post. Thanks, of course, to you guys for listening. Until next time, be safe and take care of each other. Peace.