Unless Something Changes, Bitcoin Adoption In The West Will Be KYC’d
This is an opinion editorial by Robert Hall, a content creator and small business owner.
What is the most likely path to hyperbitcoinization? This is a question that has come up in my mind time and time again. Will it be a top-down implementation like we saw in El Salvador last year? Regarding world leaders, Nayib Bukele is the rare exception to the rule. Most world leaders think within a predefined box of fiat options.
Will adoption look more people-powered like in Nigeria, where Bitcoin was integral to funding the youth-led protest against the Special Anti-Robbery Squad (SARS) in October 2020, after protesters’ bank accounts were frozen?
Bitcoin adoption in Nigeria has continued to grow despite their central bank banning legacy financial institutions in Nigeria from interacting with Bitcoin at all. Bitcoin P2P trading in Nigeria is up 27 percent despite the ban.
Bitcoin adoption in Nigeria and El Salvador are two examples of opposite sides of the adoption spectrum. Both are working despite legal hurdles and educating more people about Bitcoin.
What will widespread adoption look like in developed countries such as the United States, Europe and developed countries? The dynamics in the West differ significantly from that of developing countries. Western countries have the rule of law, regulated markets, a population that has access to bank accounts and a currency that doesn’t debase as rapidly as other currencies.
Bitcoin adoption in the West is going to take a fundamentally different path than the path other parts of the world are going to take. This should be acknowledged and inform how Bitcoiners talk about adoption in the western world.
If you live in the West, you live in an economic and political panopticon. Your government knows who you are, where you live and how much money you earn. They also can gather your phone records, transaction history and online activity with impunity via third-party providers.
If you have money in a bank account, Western governments can call your bank, tell them you are a terrorist, and seize your bank account. Don’t think it can happen to you? It happened in Canada to regular everyday citizens protesting against government policies they disagreed with and were agitating for change. The Canadian truckers were not violent thugs with weapons; they used well-established protest tactics to have their voices heard.
Think this is an isolated incident? Authorities in the Netherlands opened fire on a farmer protesting against government plans that would have them cut nitrogen oxide and ammonia emissions by 70 percent in seven years. The state could give two sh*ts about your life if it gets in the way of their plan, plain and simple. You know it, and I know it. There is no need to sugarcoat anything here.
The idea that we are free is folly. Bitcoin is our best hope to change our current circumstances, but it starts with people purchasing and owning Bitcoin.
Where Do People In The West Buy Bitcoin?
For a large majority of people new to Bitcoin, their first interaction with bitcoin will be through exchanges such as Coinbase, Kraken, Binance and OkCoin. Not ideal, but these are the facts.
According to a recent article, 46.5 million Americans have never owned cryptocurrency and plan on buying it next year. 32 percent believe that cryptocurrency will replace fiat currency over time. Presumably, a large portion of these new buyers will be looking at buying bitcoin. They will be buying their bitcoin on exchanges.
These entities comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations set forth by their jurisdictions.
The people new to Bitcoin will have no problem handing over their personal information to these companies because they see it as normal and is something they have done their whole lives. This is a fact of life that isn’t going away anytime soon.
This is an unpopular opinion, but I will say it anyway. Mass adoption of Bitcoin in the Western world will be with KYC’d Bitcoin. I wish it weren’t the case, but I don’t see how it won’t be. There is even an implicit realization of this fact on Bitcoin Twitter.
The new people coming into Bitcoin won’t be your anarcho-capitalist types that want nothing to do with the state. The next wave of people coming into the space will be the mom-and-pop shop owners down the street, your truck driver, mailman or a teacher looking to save their hard-earned money in money that the government can’t debase.
Many people see the government and the laws and regulations they promulgate as a form of safety. They might see KYC as a good thing. Currently, KYC is a fact of life, and this creates honeypots of information for hackers to target. We’ve dealt with this problem in the fiat world; we’ll also have to deal with it on a bitcoin standard. I didn’t make rules; I’m just looking at the facts as they are now. That doesn’t mean any of this can’t change.
Still, I believe advising newcomers about different privacy methods is the way to go. There are many great articles here on how to make your Bitcoin more private.
In addition to teaching newcomers about privacy methods, we should all work on creating a bitcoin-powered parallel economy where we don’t need fiat offramps. This is the ultimate goal.
El Zonte in El Salvador and other communities have shown us how we can follow in their footsteps.
The future of bitcoin is bright if we can get enough people on the bitcoin lifeboat. We shouldn’t quarrel about what path they took to get there, but educate them on the most private ways to do so.
Stay focused on the mission. Educate others. Stack sats.
This is a guest post by Robert Hall. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.
Read More: Unless Something Changes, Bitcoin Adoption In The West Will Be KYC’d
Disclaimer:The information provided on this website does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the website’s content as such. NewsOfBitcoin.com does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.