Adopt Crypto - Find It Is Already Regulated
First hand account of trying to use it
I often see the touting of Bitcoin as the next free thing, with articles that feel like they’re trying too hard to convince me of the point. Commentators roar - like NFT users do NFTs - it is the next great thing, and those opposed are ye olden Boomers.
I know Bitcoin Senator, I’ve used it, and you’re no Bitcoin user. I had the displeasure of drawing the ire of the Deep State, a guinea pig of financial blockades before even Gab experienced it. I gave advice to Gab on how to deal with issues (shortstop: mail-in cheques and merch store proxies).
Acquiring It Under Oppression Is Harder Than It Looks
Bitcoin, how it tracks finances from A to B, researchers can identify users with some effort. Difficult to use under the ire of the Deep State.
My naive first port of call was CoinBase. Somehow, they could identify me whenever I tried to sign up before I had even given any details (perhaps to do with them working for the US government?).
Their website wouldn’t even load for me. Even if it had, their website demands your personal information - like passport, driving licence - as part of ‘Know Your Customer’ (KYC) laws. Sell your face to access crypto. Gab got booted off CoinBase ‘because reasons’, so even if compliance happened, censorship of speech is still a thing.
KYC laws are deployed under the flimsy excuse of stopping money laundering (AML - ‘anti-money laundering’), but in truth are wielded against the public, as actual money launderers use much more sophisticated, large scale tactics.
Apparently my single £20 transaction is me being a multi-million money launderer for the drug mules. Your daily reminder that HSBC bank money launder millions for drugs companies without question. Many banks in Europe do as well. So I call it what it is: complete bulls—t. [This was written before the FTX collapse but I disgress, big money does a lot of laundering; this is pure authoritarian control]
You will find all Bitcoin exchanges do this. ‘Even the Chinese?’ - especially the Chinese. So, no, it isn’t free in the slightest from the government. And yes, I did try other approaches.
The Financial Suppression Network Is Large
If I can’t buy the Bitcoin directly, why don’t I just mine it?
Of course, forget now that no longer can joe public truly mine Bitcoin on their often slower computers (and Bitcoin is finite so eventually this won’t even be an option for future).
Sure you could join mining pools, but the rate of return is never going to pay any of your real world Bitcoin bills in time even if you throw your computer full time into the task.
So why not upgrade? I figured I’d rent a hashing server. These are servers you can throw money at, and they hash Bitcoin on your behalf. Yes, there is a loss in conversion but Bitcoin is Bitcoin. That should work, right?
Nope. My card provider blocked the payment, and then the hashing company demanded I provide them with a mugshot of my face and personal ID. KYC kicked in again. Even though I wasn’t buying money or currency, I was renting a server. It could have hypothetically been processing anything.
Remember, I was under the thumb of oppression from the Deep State, this is how it’d be under normal oppressive circumstances for everybody else - they just haven’t flipped the switch yet.
I Couldn’t Buy Hardware Either
This might have come to as a surprise to some people. ASIC miners were the leading means of hashing (they still seem to be, but perhaps they’ll get supplanted). If I couldn’t obtain a rental server, I could just buy some hardware specifically for Bitcoin, hash for a bit, get some Bitcoin, right?
Wrong. Purchasing the equipment was blocked by the card provider, and second hand ASIC chips were, obviously, very hot commodities for the same reasons I was experiencing. You’d be lucky if you found a broken one for sale. GPUs were absurdly expensive, and unavailable given the combo meal-deal of gamer/miner demand.
Other hardware providers - manufacturers and the like - also wanted to see my mugshot. Guess what? KYC was extended there. What? Yeah, you can’t buy computer hardware for Bitcoin either. Free and decentralised my butt.
All these people touting the freedom of Bitcoin from the government must have been doing drugs (figuratively) or simply were so mundane the government had no interest in stopping their activities. My crime? Exposing government corruption of course. How evil of me.
What About ‘Non-Government Approved’ Options?
Now, obviously, this is public, but no. Not because I am some upright, righteous citizen hero who abides the law - because I definitely am - but because sites that don’t follow the law tend to engage in other illegal activities. Namely, scams!
Why not just find an exchange that simply doesn’t do KYC? Well, ignoring the fact ‘tis illegal, many exchanges that claim they don’t need ID will prompt for it anyway as a form of false advertising. But lets say you do find one that asks no questions.
You pay the scam coin exchange some money, roll the dice. They won’t ask for your ID… but then they won’t give you theirs either, and naturally they can - and do - just run with your cash. Who are you going to call, the police? ‘Hello officer I picked a website that had no KYC protections and got scammed a- hello? Hello?’
Even assuming Mr Deep State Officer is very understanding of your innocent mistake and misunderstanding of finance law, they won’t be able to get your money back. Not that card payment services would even approve it in the first place.
And don’t expect the government to help with the illegal payment blocks either. You want to know how high level the payment blocks were? My bank didn’t even know they were happening, suggesting it was the card service provider. Or something even higher.
The financial authority said they don’t regulate card service providers even though they’re financial. Oh, convenient that, they don’t regulate the financial crooks. Amusingly, same year, my bank ditched the card service provider. I guess they didn’t like the idea of someone blocking their customers on their behalf.
How About In-Person?
Peer-to-peer will save the day! If I had a Bitcoin for every time someone suggested a person-to-person transaction I’d own the entire blockchain. So, you know the issue with scammers? That, but more personal.
There’s the issue of arranging payment. Many do not live locally, and you don’t really want to agree to a meeting point carrying cash in a dark alley somewhere you can get robbed - with the robbers knowing you’re carrying cash. That of course assumes the person you meet isn’t some government agent instead who is going to take the liberty of taking your mugshot. Genuine crypto ‘dealers’ will not really want to meet you either, for the same reasons.
Okay, so how about online peer-to-peer? Even for people who don’t try to scam you online, they will charge a premium - usually at least double - knowing their services are rare with little competition. And they will often only offer a certain, fixed, highly variable amount - not the precise amount you need.
How do you pay them? Well, you can leave any number of financial payment papertrails. Bank account transaction - that exposes who you are, mobile payments - that expose who you are.
People think the ol’ ‘cash in the post’ trick, but there’s nothing stopping the postie or the receiver from keeping the cash and pretending it did not arrive (or was never sent). Mail cheques are also tracked and in some cases demand even more information.
I imagine the risk of scams works the other way as well. People trying to sell Bitcoin also run the risk of being gotcha’d by scammers who don’t pay for transferred Bitcoin. It is why nearly everyone will ask the one with the cash notes to initiate transaction. Cash is easier to swap and obtain than BitCoin.
Bitcoin ATMs?
Amazingly this is a thing, but, alas, no, there is a catch, as always. Ignoring the fact that at the time, very few were available anywhere, all the Bitcoin ATMs will ask you to scan your fingerprint - and must be in full view of the shopkeeper, usually at their checkout desk, just in-case anyone was thinking the ol’ ‘fake finger’ trick.
These machines will also (in addition to your biometrics) often ask for a passport or driving licence scan. Some firms will ask for this upfront where you register pre-emptively before you can use the ATM. Again, KYC and AML. You can “bypass” both, but only if you let the shopkeeper scan your passport or driving licence instead.
All naturally have cameras both on and in them, making them the complete opposite of private. I still remember when BitCoin was sold on the ‘anonymity’ aspect, and now it is sold on the flimsy premise governments can’t regulate it as it gets regulated by KYC/AML.
So, What Did You Do?
Well, two approaches, but one only worked once - I mentioned Bitcoin and a work colleague piped up they had some, and was willing to sell it for a fee on-top. They were only there temporarily, so it wasn’t something I could continue.
The second approach is a special man-in-the-middle bartering system used by ‘purse.io’, however the company went under at one point, rife with scams, and then came back. The system still had the problem of scams and people charging a premium, but it made use of both a reputation system, and a unique man-in-the-middle approach. It is the only one of the type and I imagine easy for the gov to target.
Purse would take the Bitcoin from the individual and hold it. They would ask you to buy something for them (akin to dropshipping) via Amazon. The package arrives, they verified it arrives, you get the Bitcoin. If there’s a dispute you show evidence of delivery or they refund the Bitcoin buyer.
It seems idealistic, but the problem is, as a barter system, you couldn’t set what amounts you wanted, and payment card processors still blocked specific transactions - so you might try to order certain things and it wouldn’t clear.
Cash Is Still King Of The Hill
Although it seems like a solution, it isn’t really, and it is painfully clear that governments have regulated the so-called freedom of Bitcoin into oblivion. Many of the flaws inherent to Bitcoin are less inherent flaws for cash.
For example, having my money stolen by the postie if I post it is a risk, but it is one step less complicated with cash. I don’t need to present ID to withdraw cash from cash ATMs (bank cards don’t count as anyone can hypothetically steal a card and use a PIN).
I don’t need to present ID to give someone an online cash transaction, and in some cases I can receive cash without an ID online. If I meet in person, I can buy the goods directly rather than via an intermediary.
It might explain why the mass surveillance state is desperately trying to squash the usage of cash but aren’t bothered by Bitcoin. Heck, some governments are even adopting it.
To me, crypto is a trap where the nasty mechanisms haven’t yet been sprung on the general populace. Stick with yer gold, silver and cash - at least you don’t need a fingerprint to withdraw your gold.
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Awesome article man I like too that the tone seemed pretty distinct for this piece. Not that that there’s anything wrong with tone in any other article. Maybe just in my head but really seemed flow too a neat bonus and was really insightful and for the the same reasons I unfortunately cannot fiscally contribute to any Substack (big source of shame you guys produce so much value but I need to eat regardless of what Trudeau would have me think , I haven’t any money to spare to try any amount of crypto out so was pretty sobering to see it in actual action. I learned a lot. Thank you. I hope you keep at it swiftly get the growth figures needed because I’d like to continue to have the luxury of reading your pieces and will be very happy to miss out on some / when/ you get that paywall clout should you choose to use it :3
Yeah it's shit. If you want to pull your money out of bitcoin or even put it into it you more or less are stuck with Binance/Coinbase & their proxies (e.g. Swyftx in Oz is a binance proxie) and you will lose %s galore in the process. Or you go onto a peer exchange and pay 2-4% per transaction (probably because crypto is so volatile and the transactions take a while to process).
https://coingeek.com/russia-plans-for-national-digital-asset-exchange-lies-in-the-hands-of-2-key-agencies/