Bisq Philosophy of Bisq, 6 Jan 2018

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From YouTube: Worse than Useless: Financial Surveillance

Description

In this Bitocin talk, Andreas makes a connection between medical pseudoscience and modern financial totalitarian surveillance, as practiced by banks and state intelligence agencies. He explores the hidden externalities and moral hazards inherent in KYC/AML policies, disconnecting whole countries and even continents from the world economy. Why is it common sense that money laundering is the fundamental business of fully-licensed, regulated banks? Who runs the real "dark net"? He urges that before people try to fix things they should first be sure they're not making it worse.

NOTE: At 15:58, I quote Martin Luther King Jr. The full quote is: "Peace is not merely the absence of some negative force — war, tension, confusion, but it is the presence of some positive force —justice, goodwill, the power of the kingdom of God." Context: https://kinginstitute.stanford.edu/king-papers/documents/when-peace-becomes-obnoxious-sermon-delivered-18-march-1956-dexter-avenue

This talk is featured in The Internet of Money volume 3, which can be purchased in multiple languages in paperback, ebook, or audiobook: https://aantonop.io/tiomv3ebooks/

Chapters
0:00 First, do no harm
1:09 Bloodletting
3:21 Why is it important to remember this concept of do no harm?
3:56 Who has access to money and who doesn't
6:32 Money laundering
9:28 Totalitarian financial surveillance
15:12 Peace through justice
16:59 What's the biggest problem with bitcoin?
18:44 Bank secrecy

This talk took place at the Riga Art Space for the Baltic Honeybadger conference on November 25th 2017 in Riga, Latvia: https://antonopoulos.com/event/baltic-honeybadger-2017/

RELATED:
Money as a System-of-Control - https://youtu.be/FyK4P7ZdOK8
The Stories We Tell About Money - https://youtu.be/ONvg9SbauMg
Bitcoin: Privacy, Identity, Surveillance and Money - https://youtu.be/Vcvl5piGlYg
ADISummit: Self-Sovereign Identity Panel - https://youtu.be/DZbyiJqKT8c
My response to Jamie Dimon - https://youtu.be/1dEcdGc0tIo
Aadhaar and blockchain identities - https://youtu.be/GylSvJf53zI
How is fungibility tied to privacy? - https://youtu.be/VuI-8EwqIS8
Fungibility, privacy, anonymity - https://youtu.be/y3s8c7YDtXU
Why KYC is dangerous - Microviolations of Privacy as Payment - https://youtu.be/rwF7nMWUjBs
Could governments take over exchanges? - https://youtu.be/9PrJQeKl9w4

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Music: "Unbounded" by Orfan (https://www.facebook.com/Orfan/)
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#Bitcoin #BitcoinEducation #Cryptocurrency

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"First, do no harm." who said that?.

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Hippocrates? actually,, he didn't.

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the hippocratic oath, one of the mainstays of medicine, starts with "first,. Do no harm.".

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It expresses the principle of minimization, the principle of utility.

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This utilitarian philosophy says that, before you, try to fix things,, make sure you're not making them worse.

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Ironically,, the father of medicine, didn't say: this.

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It wasn't part of the hippocratic oath or part of hippocrates'. Writing.-.

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It was added after the introduction of modern science into medicine, the mid 19th century.

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"First do no harm.".

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Because some things are not just useless, they're, worse than useless.

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They actually do harm.. That is title of my talk. Today: "worse than useless.".

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Hippocrates was actually a big proponent of blood-letting.

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Blood-Letting was a practice that started in the ancient mediterranean region.

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It involved balancing the humours in the body, by bleeding people out slowly.

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The idea was that the various fluids in the body need to be balanced, like a hydrodynamic system.

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Before modern science started thinking of our body as more of a machine made of clockwork,.

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Which is the 19th and 20th century visualisation,? The ancients saw it as a matter of essences, of humours.

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Earth, fire, water, air.

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Part of the idea of blood-letting was,. If these things are out of balance (I.e., you are sick),.

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You need to release some blood to bring things into balance.

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This practice continued all the way into the 19th century.

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One of the most famous victims of blood-letting was a founding father of the united states:.

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George washington.

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Late in his life, george washington woke up one day with a sore throat.

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He was a big fan of blood-letting as a medical practice, and invited his doctors / butchers to do a blood-letting.

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Over the next four days,, they bled about seven pints of blood out of him.

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The historical record is this: "despite, the treatment, he passed away four days, later." [laughter].

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Some of us might say, "because of the treatment,. He died four days, later.".

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It is an irony.. This practice continued for 2,500 years.

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But why is it important to remember this concept of "do no harm"?.

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Unless you follow the scientific method,, many of the common practices that we apply, today...

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Are based not on science, but on superstition, anecdote, wishful thinking, and righteous morality.

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One of those [practices] is financial surveillance...

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The system of "know, your customer" (kyc) and anti-money laundering (aml) rules.

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The modern system of banking, brought into being by the bank secrecy act of 1970,.

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Is a creation that bears no scrutiny from science.

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It is based on the righteous moral thinking that "bad people" should not have access to money,.

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And as long as we trust those in authority to tell us who the "bad people" are...

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(And assume they themselves are not the bad people),. Then everything will work. Out.

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If you criticise this idea,, you are not presented with facts, data, or science.

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You are accused of not being morally righteous enough to understand that we must "protect the children.".

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"Won't somebody please think of the children?".

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Because there are criminals out there., there are "bad people," and if bad people can use money,, they might use it to do bad. Things.

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It is very difficult to prosecute the bad things,, but it is a lot easier to prosecute the money.

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And so we do it.. Does it work? no.

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But if this practice was useless,, that would be good., but it is not useless,. It is worse than useless.

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In fact, it does enormous harm.

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Billions of people around the world have no participation in the world economy and are financially excluded.

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It is directly related to this closed financial system,, where authority is given to few to decide...

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Who is "good" and who is "evil,"? Who should have access to money and who should not.

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It starts with the [assumption that]. Identity is a requirement for every endpoint of transactions.

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It is a system that will always exclude billions.

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In the age of the internet,, we have gone no further in terms of financial inclusion.

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In fact, we are now backtracking.

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entire countries,. Entire continents are disconnected from the world economy to satisfy the moralistic,.

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Bourgeoisie idea that we are safer if we allow bureaucrats to decide who has access to money.

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Money laundering happens every day,, but there are some who can money launder without consequences.

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In our modern world,, there is such a thing as a license to launder money:. It is called a banking license.

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As long as you have one of these magic licenses,, you can launder money all day, long.

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Who is money? Laundering? of course,, conventional wisdom and common sense will tell you: it is the banks.

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They have the money,, they launder. obviously.

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If you look at the statistics and the data,, this fact is shown again and again. banks launder money.

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That is their main activity!. They launder money for governments, intelligence agencies, funding, terrorism;.

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They launder money for narco-traffickers.

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One of the hilarious examples was a certain big bank that modified their teller windows...

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Mexico, precisely so they could fit a samsonite case.

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(The favourite case of drug money launderers),, so they could conveniently stuff cash through.

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They wouldn't have to even unpack it.

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In those days,, the big drug cartels were making so much money (and. They still are) that they don't count. Money.

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You weigh it,, because that is faster. who has time to count a truck full of money?.

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You can just calculate the net weight.

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Money laundering is something that banks do on a routine basis.

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Every time they're caught, they pay a fine,, no one goes to jail, and banking continues.

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Which [signals] that this a fundamental part of [their] business;? It is rewarded with a series of incentives...

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To ensure that by playing these fake regulations,, they can force the competition out of the game.

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No one [could] compete with traditional banking using technology, because the regulations ensure...

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You must ask for permission first.. The answer is always "no,". Unless you can afford a banking license,.

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The license to money, launder and the fines that come with it as part of doing business.

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Banks can afford it,, because there is one thing: banks do well and that is make a lot of money.

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Worse than useless.

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The very basis of modern finance is an idea that should be so abhorrent to free people...

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The topic of every conversation.

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We discuss the revelations from snowden about broad -based surveillance of our societies on the internet.

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Yet the elephant in the room,, the thing we don't discuss, is the most pervasive and intrusive form of surveillance:.

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The international network of totalitarian financial surveillance.

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Every time you use a debit card,, a credit card,, a bank account,, the transaction is...

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Funneled to every intelligence service of governments which [can surveil, these network].

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When people criticise bitcoin,, they say it will "enable the dark net.". What is the dark, net?.

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Presumably the "dark net" is invisible to most of us, operates on top of / in parallel with the internet,.

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And massive amounts of illegal activity, happen.

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If that is the case,, the dark net's name is echelon, prism, x-keyscore.

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Those are the names of the [real] "dark net.".

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The "dark net" is operated by intelligence agencies because they are, on a daily basis,.

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Committing massive crimes against human rights.

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They orchestrate a totalitarian financial surveillance network that monitors...

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Everybody's transactions, location, purchasing preferences, political preferences,.

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All of that is tied to your financial life,. Everything is tied to your financial life.

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This system of totalitarian financial surveillance is the [real] "dark net.".

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They don't fear the dark net, they just don't want us to have one too. [laughter].

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Worse than useless., this system ensures that 2.5 billion people live with absolutely no access to financial services;.

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4 billion people, if you count their families, [and those with] minimal access to the most basic services.

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If you [base it on] the type of power banking, a western person has,, then 6 billion people...

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Have much more limited access to that.

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This is what [bitcoin] is about,. The other 6 billion.

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Why does bitcoin matter?.

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Bitcoin enables us to build a system where we can flip the balance between secrecy and privacy.

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What is secrecy?, what is privacy?

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privacy is what I have, not because someone gives it to me,, not because it was granted as a privilege,.

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But because [I claim it] as my human right.

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I have had it from birth,, I will have it forever.

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Secrecy is the ability of a government, supposed to be subservient to its voters...

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And operating by the consent of the governed, to instead bypass democratic control and accountability.

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Black projects, to fund terrorism and drug lords.

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Who funds isis? our tax money? Does.? That is the uncomfortable truth.

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Not with bitcoin, but with dollars and rubles and yuan.

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Money laundering is a government- sponsored activity supported by banks.

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Terrorism, financing is a government activity supported by the banks.

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Yet they have the audacity to claim that people shouldn't be free to transact, participate in a global economy,.

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Or exercise their birthright of privacy,, because the world will descend into chaos,, mayhem, and anarchy.

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What happens when people can transact anonymously?.

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Nothing happens. for thousands of years, people were transacting, anonymously.

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The greatest, most established,, private and peer-to-peer network of payments is called cash.

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We've had it for thousands of years. suddenly, in the '70s, we decided. This was dangerous.

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We moved to a world of totalitarian financial surveillance.. That is what it is.

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It [tries to be] all-encompassing,, all-powerful, and secret.. That is what the word 'totalitarian' means.. It is fascist.

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Somehow, we have been persuaded that "for, the sake of the children," [all of our transactions must be visible],.

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But every one of their transactions is private.

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I say that is the wrong way. Around;. I say we [need] to flip that equation and flip it fast.

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The reason the world is in chaos is partly because of that [system]. you want to breed terrorism?.

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Cut people off from the economy, trap them in poverty, and remove justice.. What [eventually] happens is war.

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Martin luther king jr. said, "peace is not the absence of war,. It is the presence of justice.".

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Justice starts with the assertion of human rights.

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Bitcoin is not just about playing with money, getting rich,.

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Creating an ico or the next upper class to lord over everybody, else.

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At least,, that is not what I'm interested in.. I am interested in creating peace through justice.

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Justice starts with [enabling] every human being on this planet to transact freely, with privacy.

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Anyone, anywhere, anytime. uncensorable,, unstoppable, anonymous.

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You think the fight over [bitcoin's] block size was bad?.

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You think a few people [fighting with] trolls and sockpuppets in social media,.

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Throwing money around to influence opinion on both sides was bad?.

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There are people who are working on the next [upgrades for] bitcoin,, including zero-knowledge range proofs,,.

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Confidential transactions,, coinjoins, and onion routed payment channels, which are completely unstoppable.

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People ask me,: "what, do you think is the biggest problem with bitcoin?? Is it scaling?? Is it fraud?".

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"Is it centralisation of mining?" no,. It is that we don't have enough anonymity.. We don't have enough privacy.

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We better fix that before this gets too popular.

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Adoption of a platform [or application] with insufficient privacy is extremely dangerous.

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If you're the only one doing anonymous transactions,, you are not anonymous., we need ubiquity of privacy.

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This should not be an option. I [enable] in my samourai wallet that says 'use tor.'.

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It should be default on every wallet,, every time.. There should be no transaction that isn't confidential.

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Here is the interesting thing:. If you ask the banks whether they want anonymous, transactions,.

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They absolutely do!.

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Built with anonymity, using zero-knowlege proofs,.

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Range proofs,, mixers, and confidential transactions.

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They are trying to build confidential and anonymous systems for settlement. why?.

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Because they can't trust the motherfucker sitting across the table from them, who runs the competitive bank.

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If they know what happens on the network,, they will front-run every transaction,.

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They will pump-and-dump every [traded] asset.

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why?, because that is [already] what they do. Every single day.

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Of course,, since they can't trust each other,, they understand the need for privacy.

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They will build their private blockchains,, their clearing and settlement networks.

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They will make absolutely sure that they have confidentiality, privacy, anonymity, deniability.

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They will make sure [to] have all of those things,.

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They will achieve their secrecy..

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The question now is,. Will we achieve our privacy?? Will we assert our human right of privacy?.

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Will we use this technology not to enslave the world through a totalitarian financial system,.

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But to free the world?.

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Will we do something that, first and foremost,? Will "do no harm"? thank you. [applause].