The catastrophe is among us – and driving the Bitcoin

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The scenes seen at the US Capitol this week only reinforce the idea of chaos and catastrophe for our societies – and Bitcoin Formula scam is the one that has been getting stronger.

By February 2020, if anyone told you that the world was on the verge of a global catastrophe, most people would understand the phrase more as an exercise in rhetoric than a consistent forecast.

Ten months later, with a paralyzed world, economies in recession, a health crisis still far from over, and mistrust contaminated by all sectors of society, the catastrophe seems increasingly close to reality.

The scenes seen in the United States this week, with a horde of supporters of defeated President Donald Trump wearing T-shirts with Nazi messages, Confederate flags, guns at the waist and horns on his head invading the U.S. Congress in the most important week in its history in at least 40 years, only reinforce the apocalyptic scenario.

If the largest nation in the Western world allows depressing scenes like those seen this week, what will the rest of the world say?

In an article published this week, Jeffrey A. Tucker, director-editor of the American Institute for Economic Research, addresses various aspects of the coronavirus pandemic, particularly the nations‘ response to the health crisis, with the imposition of severe lockdowns and closure of the economy.

For the American economist, the decision of governments to confine populations and restrict economic activity under sanitary justifications is absurd. The United States, like Brazil, has continental dimensions, which makes the imposition of lockdowns – escalated by the legislative independence of the 50 U.S. states – very controversial and complicated.

Despite the sceptical position regarding the dimension of the health crisis and its consequences – more directly: mass deaths – it raises important questions about the pandemic, such as the forced imposition of masks, the severe lockdown as the only possible solution, the passivity of governments to balance the impacts on health and the economy, among others.

Among those who feed and bet on chaos as a tool of political bargaining, the two countries also equate: Donald Trump, stimulating acts in the Capitol, taxing them as „courageous“ for not subjecting the country to WHO impositions and blaming China, the main geopolitical rival of the USA, for the global catastrophe.

Jair Bolsonaro does not have the same „luck“: since the beginning of his mandate, the Brazilian president has been fed with conflicting statements, with the objective of confusing, demoralizing and emptying those who oppose him – the organized Brazilian society, among them the traditional media, universities, governors, mayors, social organizations and agencies of control and civil foment. When criticized, it appeals to exaggeration.

Bolsonaro uses similar tactics, appealing to social chaos as a justification for more drastic measures (all already announced by the president and his allies) taken by the government: closure of Congress and the Supreme Court, paper elections subject to manipulation, more power for the Armed Forces, less power and organization for civil society. The Brazilian president has already tried to put his bluff into practice, but one ingredient was missing: social chaos.

Trump and Bolsonaro present other strategies in common, seeking the enchantment of the masses along the same paths: armed populations, overvaluation of their governments‘ achievements, contempt for the values that formed democracy and republic, and frequent threats to other powers.

Until this week, the threats were based on rhetoric, followed by increasingly less true „denials“. But Trump’s defeat in the elections radicalized discourse – and actions.

In the world experiencing the greatest catastrophe since the two Great Wars, Trump and Bolsonaro saw an opportunity to profit politically, to stimulate the centralization of power and authoritarianism to the limit of what we know as democracy. To do so, they fed millions of people frustrated with the political and civil system of capitalist societies with a populist rhetoric clearly inspired by the fascism of the 1930s/1940s.

The historical distance of the pre-World War II decade – and an era of hyperinformation in which the historical weight of crimes against humanity dissipates into empty debates with invented truths – continues to lead contemporary societies to the same abyss as Hitler and Mussolini – and in very similar conditions. And the power of propaganda – and lies – continues to be fundamental to the survival of capitalist societies.

If World War II marks a break with the authoritarian societies that survived until the 19th century, with the spread of republican and democratic regimes around the world, the coronavirus pandemic, the pressures of the so-called late capitalism, the brutal economic recession that is coming and its still unknown consequences push us into conflict, catastrophe and uncertainty – fuels for those who bet on chaos.

Late or Post-Capitalism

Perhaps one of the most interesting characteristics of late capitalism that we live is the movements of opposition to governments like Trump and Bolsonaro. Until the 2000s, the global right advocated the conservation of values and systems in force, purposely confusing capitalism with democracy.

Today, the ultra-trumpist and stock market right preaches rupture, centralization of power, authoritarianism, the extinction of supposed „privileges for minorities,“ the personalism of leaders, and the end of what we knew as social democracy – a legacy that comes from the Cold War as a capitalist response to socialism. Faced with this scenario, today it is up to the opposition – from the moderate right to the left – to defend the system, democracy, and the republic – politics stopped selling dreams and began to defend the continuity of „everything that is there.

The most radical socialists – who once preached revolution and the communist dictatorship – and conservatives today occupy the same confused boat, reacting to every absurdity with the constitution in one hand, democratic values in the other. None of them responds to the main sentiment of our society, which drives authoritarian figures around the world: collective frustration.

The term „late capitalism“ was first used by German economist Werner Sombart. Although academic articles consider the period between World War II and the late 1970s, since 2016 the term has been used in the United States and Canada to refer to the absurdities, contradictions, crises, injustices and inequalities of modern society. In the Academy, another term has already emerged to refer to contemporary capitalism: post-capitalism.

While the global financial market benefits billionaires, heirs and intermediaries of the most varied sectors (a few thousand a year), the majority of the population – billions of people – live on leftovers in the economy, with less and less purchasing power, less and less possibility of social mobility and – after all, we follow capitalism – less political power.

Bitcoin and chaos

Bitcoin was developed in 2008 by Satoshi Nakamoto, until today a mysterious pseudonym in the cryptoesphere. Nakamoto’s idea was to create a global currency to offer resilience in times of crisis, without the possibility of centralization, with finite and programmed supply, and inflation-resistant price fluctuation.

When the largest cryptomoeda felt the effect of the explosion of the coronavirus crisis in March 2020, falling to $3,800, many doubted Bitcoin’s ability to become a „safe harbor“, crisis-resistant currency, as gold was for centuries. Today, ten months later, with the currency worth ten times as much, Bitcoin’s behavior seems to strengthen its image as an economic protection asset.

Nassim Nicholas Taleb, author of the book Antifragile: Things That Gain from Disorder, defines the term „antifragility“ for assets that „grow in disorder“, and seems to be tailor-made for Bitcoin:

„Antifragility is beyond resilience or robustness. Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder and stress factors and love adventure, risk and uncertainty … The resilient resists shocks and remains the same; the antifragile gets better“.

In November 2020, analyst Pedro Febrero also recognized BTC as an „anti-fragile system,“ recalling:

„After each incident, Bitcoin became stronger in terms of network adoption and price. The probability of continuing to operate successfully under attack (anti-fragility) is much higher than any closed system“.

Bitcoin’s monetary consensus mechanism, according to the head of business development at Unchained Capital, strengthens the „creation of order in chaos“ for cryptomeda:

„By eliminating trust in centralized counterparts, all network participants can trust and ultimately trust that monetary policy is secure and not subject to arbitrary change. It may seem a paradox, but it is perfectly rational. Ultimately, a spontaneous order emerges from the disorder and strengthens as each shock in the exogenous system is absorbed. ”

Obviously, not all financial analysts trust Bitcoin as a response to crises – especially the more conservative ones, who defend „autonomous“ and supposedly „policy-free“ central banks and monetary authorities.

In addition to Bitcoin, its adjacent technology, blockchain, is also cited by a number of experts as one of the possible responses to the global economic crisis.

As reported by Cointelegraph Brazil, David Gibbin, CEO of a software developer for the financial market, Investtools, argued for example that blockchain technology could „free the country from the political and institutional chaos“ that has affected the country since 2014:

„In the current political scenario, where news about corruption and money laundering is increasingly frequent, the population’s desire for transparency tools in governments is inevitable. Although a solution for controlling public spending seems utopian, given the scale of the problem in Brazil, it exists and is in a technology known to many, but really understood by few: the blockchain“.

He goes on to say that „the technology (blockchain) takes away from the government and other corruptible entities the roles of providers and issuers of an increasingly fragile ‚truth‘.

Gibbin is not alone in defending the blockchain in search of transparency and efficiency for the state. In a recent article for Other Words, PUC-SP economics professor Ladislay Dowbor wrote that global indebtedness, among families, companies and governments, reached double the world’s GDP in 2018 – an equation with no apparent solution. He cites a „parasitic capitalism,“ in the words of philosopher Zygmunt Bauman:

„The current system is a success in transforming a huge majority of men, women, old and young into a race of debtors. […] Without half words, capitalism is a parasitic system. Like all parasites, it can thrive for a time, as long as it finds an organism that has not yet been exploited to provide it with food. But it cannot do this without harming the host, thus destroying sooner or later the conditions of its prosperity or even its survival.

The professor reminds us that in Brazil and in the world populations have realized that banks and financial entities have benefited from the financial resources of clients, charging interest on the most varied services, with no counterpart so that their resources are kept in their bank accounts.

„In other words, we have to find in the same technological transformation the basis for our release of the permanent drain to which we are submitted, a toll not only useless but counterproductive,“ he writes. The professor defends disintermediation – another principle of Bitcoin – and cites examples from around the world, including that of cryptomorphs and blockchain technology:

„Do we need these intermediaries? We have the alternatives of cooperative banks (Poland), community development banks (114 already in Brazil), local savings banks (Sparkassen, in Germany), social currencies (the palm, the sampaio and so many others in Brazil), local public banks (Bank of North Dakota), in the United States), credit NGOs (Placements Éthiques in France), direct contact between producers and clients (family farming in Kenya) and even the most radical disintermediation with virtual currencies and commercial exchanges through blockchain technologies. „

In fact, blockchain and Bitcoin cannot solve all contemporary economic problems, especially political and social ones, but they can act in societies by applying one of their key principles: decentralization.

In front of the US Capitol scenes, a Brazilian user on Twitter remembered the blockchain technology to question Donald Trump’s blockchain in the main Western social networks: „If we had decentralized social networks with blockchain technology, none of this would be possible“.

In fact, if this were the case – still applying Bitcoin’s consensus mechanism – maybe neither Donald Trump nor Bolsonaro would be allowed to stimulate the crimes of his followers using social network platforms.