Bitcoin's Velvet Revolution: Overthrowing Crony Capitalism

If you take Marx and Engels today and give them a newspaper, the apparent absence of class conflict might make revolutionaries think they have won. They will see a society divided on various issues - but virtually silent on the eternal struggle between labor and capital, oppressor and exploited.

How different it would have been if they had gone back 10 years, when Occupy Wall Street was in full swing and tent cities sprung up to protest crony capitalism, greedy corporations, and a reckless and even out-of-control financial sector. Ten years on, the same problems persist, but they've become an imperceptible background buzz amidst the loud, raging culture wars.

The 1% may be sleeping more soundly these days, but any complacency they feel is completely misplaced. The anger never really went away, and capitalist grievances were no longer confined to the left as inequality became more pronounced. Crucially, these primitive revolutionaries now have access to the most powerful economic weapon that ordinary citizens have ever had.

welfare of the rich

Why is a revolution brewing? Because people are not stupid. They see governments spending trillions of dollars to prop up "too big to fail" banks while the poor continue to struggle with their paychecks. What most people don't realize, however, is that the government knows that providing benefits to the rich hits the poor the hardest. In fact, they knew about it 300 years ago.

The Cantillon Effect, first proposed in the early 18th century, describes that printing money makes the rich richer and the poor poorer. When large amounts of new money are injected into an economy, the first recipients can spend the money before prices rise. If they're cautious -- and the rich often are -- they invest in assets such as real estate, precious metals, art or fine wine.

When this money "trickles down" to the poor (if at all), it becomes substantially devalued due to the inflationary effects of printing money. As prices rise, the income of the rich doubles because the value of their own assets increases, while the income of the poor falls relatively sharply as the cost of living soars.

Anyone would be outraged by an economic machine that makes life harder for the poorest in society while rewarding reckless corporate behaviour. What is seldom understood, however, is that this is not a flaw in the so-called capitalist economic system—it is an inherent feature of it.

Crony Capitalism and "Soft Socialism"

It is very common to blame "capitalism" for the economic and social problems facing the world today. In fact, if Marx were alive today, he would find much to love about the current financial system—including some concepts straight out of the Communist Manifesto. For example, the fifth principle of Marxist communism advocates the "centralization of credit in the hands of the state through a national bank with state capital and a monopoly." Sound familiar?

The truth is that, in many ways, we are actually living in a “soft socialist” utopia, where regulation, subsidies, and other state interventions revolve around protecting corporate titans and those whose wealth resides in assets rather than savings accounts. It is hard to see how a further shift to the left would address the structural flaws of an economic system that already sees printing money as the answer to all problems. But then again, without a proper, bloody revolution, it's hard to imagine what we can do to counter these powerful vested interests and their political backers. To borrow one of Lenin's favorite quotes: What shall we do?

Whether you're on the left or the right, the answer is to avoid fighting the rich in their name. There is only one way for the poorest in society to wrest power from the 1%, and that is by removing their ability to manipulate fiat currencies.

a bloodless revolution

Can Bitcoin (BTC) really challenge the millennium-long supremacy of the bourgeoisie without bloodshed? You might say I'm a dreamer, but I'm not the only one. Just ask the Salvadorans.

Before bitcoin, Salvadorans receiving overseas money transfers had to pay transfer companies such as Western Union or MoneyGram a hefty fee that was far better spent on food or medicine . These businesses lost an estimated $400 million per year as Bitcoin was adopted as a fiat currency. The money goes straight back into the pockets of the world's poorest people.

This is how revolutions will happen - not by violence, but by choice. Give people the knowledge of how the fiat currency system keeps them poor, give them the ability to grow their wealth in non-inflationary Bitcoin, and they'll vote with their feet. As more and more people use Bitcoin as a hedge against inflation, the importance of fiat currencies will only decline, rather than be overthrown by a flash coup. This process will accelerate as the "squeezed middle class" finds itself hit even harder. History has shown that revolutions happen only when the middle class and political moderates embrace their radical ideas.

Today, that same rebellion is in the air. People lost faith in their politicians a long time ago, but now they are starting to question long-standing economic and monetary narratives. What makes Bitcoin so compelling is that it doesn’t need to proclaim its own credo, or attack the other side: the more people learn about Bitcoin, the more they understand how they are being duped under the current system.

Critics of Bitcoin like to say that it is too complex for mass adoption. But which is more difficult to understand, a digital currency with a hard cap of 21 million coins, or a dizzying array of tricks used by central banks and finance ministers to cover up inflationary policies that reward the rich and hurt the poor?

Revolutionary France had the guillotine, the Soviet Union had the gulag, and we don't need terror to fight the tyranny of an unsound currency. What we need is a true velvet revolution: our only weapon is an alternative currency that is not inflated, censorable or manipulated, and the only "victims" are those who earn money from a system that hurts everyone profiteering people.

Cointelegraph Chinese is a blockchain news information platform, and the information provided only represents the author's personal opinion, has nothing to do with the position of the Cointelegraph Chinese platform, and does not constitute any investment and financial advice. Readers are requested to establish correct currency concepts and investment concepts, and earnestly raise risk awareness.