Anthony Pompliano sends his findings and thoughts about bitcoin to all his followers on a daily basis. Below a translation of his best piece of the past week.
This may be one of the most important things I’ve ever written about Bitcoin.
We are watching a currency attempt to attain global reserve status without ever engaging in a single conflict.https: //t.co/xPjmm2vn8D
– Pump ? (@APompliano) July 1, 2019
In the past: strongest army, strongest currency
The country with the strongest army historically ensures that their national monetary system became the worldwide standard. This started with the Silver Drachma of Athens from the 5th century BC. Then Rome did the same with their Golden Aureus (from the 1st century BC to the 4th century AD) to replace the currency in the year 312 AD for the silver Denarius coin.
When the Western Roman Empire fell and the Eastern Roman Empire (Byzantine Empire) blossomed, the silver Denarius was replaced by “Byzantine coins” or a “golden Solidus.” These were further developed variants of the coins of the Western Roman Empire . During the beginning of the 11th century, the gold Solidus gradually became less valuable and eventually emperor Alexios I Komnenos replaced the “hyperpyron” coin, a refined gold coin containing twenty percent less gold.
Towards the end of the 7th century we saw the rise of the Islamic Dinar. It was only in the 13th century that the Fiorino from Florence became dominant worldwide. This was already succeeded in the 15th century by the Ducato from Venice. In the 17th century our guilder took over as a world currency. Before the beginning of the 19th century, the British Pound Sterling took over the role of the world’s most important currency. And that would remain so until the Second World War.
After the Second World War, the US dollar took the position of global reserve currency, and the US has defended this status with all its heart since WWII. As mentioned earlier, the most powerful country determines which currency is the world’s reserve currency.
In the future: bitcoin as a world currency without military power
However, this trend is going to change.
Until now, the country determined the world currency with its superior military firepower and tactics. It mattered who prevailed on land, sea or sky. But where we are going in the future, the bombs, bullets, tanks, ships and fighter jets will no longer be as important as they once were. We are making the transition from physical warfare to cyber warfare.
We no longer have to send troops if we can attack the critical infrastructure of a country, such as the electricity grid, banking system and media publications. War becomes even less necessary if the US can arm the US dollar and cut entire countries off of the international financial system, such as Venezuela, Iran and North Korea.
However, there is one problem with this military, economic cyber strategy: what happens if a country cannot be attacked with military firepower, economic sanctions or cyber warfare?
This may sound like a ridiculous question at first, but it is not. Whether we like it or not, there is a group of people (the internet) who have created a new currency (bitcoin) that is slowly fighting to become the global reserve currency.
Instead of devising a plan to gain superiority by attacking other countries or currencies, bitcoin is designed so that it can survive any known attack. In the case of bitcoin, the best attack is a good defense.
These are the three main threats to the global reserve status of a currency:
- Military superiority – If you control the global reserve currency and your superpower status is withdrawn, you have historically lost the general reserve status. No matter how hard states try, there are no individuals, companies or physical locations to attack. No person or group controls bitcoin. If a country caught or killed an individual, nothing would change. If a nation state were to blow up all the miners in their country, nothing would change. In other words, the decentralized nature of bitcoin makes military superiority irrelevant.
- Economic sanctions – The US has done their utmost to defend global reserve status by arming the US dollar. Unfortunately for America and its bankers, there is no individual, company or country to deal with if they want to stop bitcoin. Nobody has control, so economic sanctions are irrelevant.
- Cyber warfare – Over the past ten years, Bitcoin has become the safest computer network in the world. There are hundreds of billions of dollars in incentives for someone to successfully attack the system, but no one has succeeded so far. In addition, the network becomes stronger every day (up to 10x in hash speed during the past 2.5 years), which extends the security. Due to the decentralized nature of Bitcoin, cyber attacks do not help you.
What does this mean exactly?
Bitcoin is the first world currency that (1) is not supported by a nation state and (2) has the ability to withstand any attack by any country in the world. The “defense first” approach to bitcoin design is likely to lead to a world where currency control is shifting from military / economic / cyber superiority to decentralized superiority.
The Ministry of Defense of Bitcoin has no bullets, no bombs, no ships, no fighter jets and no soldiers. It has thousands of volunteers and millions of computers all over the world working together to ensure that there is no single point of failure.
The world is changing fast and countries are already lagging behind. Bitcoin is the sleeping giant that is ready to become the first global reserve currency without ever having to be in conflict.
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