9 ms·

Say everyone in an unstable economy were paid in usd. If that country has foreign deficit, if that country has high government debt. What happens? How can the g

Say everyone in an unstable economy were paid in usd. If that country has foreign deficit, if that country has high government debt. What happens? How can the government keep paying its own employees? How does it pay retiree checks? How does it subsidize farming when needed? As long as a country cannot print usd itself, this is a fast shortcut to unemployment, hunger, etc... Strong currencies are not the solution to poor governance. Good governance and democracy makes a country and its currency strong. Not vice versa.

l_pan_ 6y ago
Well said. I believe this is why the US and many others abandoned the gold standard.
ardy42 6y ago
> Strong currencies are not the solution to poor governance. Good governance and democracy makes a country and its currency strong. Not vice versa. That's a good point. Too many people propose individualist solutions to social problems, and all their "solution" would do is make the social problem worse. I think that stems often stems from an overzealous faith in free markets, which leads to a distorted idea that individual self interest factored over all of society always results in social benefits, so you only need to consider things from the perspective of an individual (which is also far more familiar to most people). Sometimes individual self interest does lead to social benefits, but often it doesn't.
- imtringued 6y ago
  Markets only exist within the context of a political system. They are just a tool to reach a certain policy outcome. The idea of using the free market to replace poor governance is laughable. It's the opposite. You have to set the right policies and incentives and only then will the free market show its true beauty. Markets fail or succeed because of improper or proper governance. It's like a genetic/ML algorithm that is optimizing for a cost function. If your cost function is awful your algorithm will be awful but that's not an argument in favor of getting rid of cost functions entirely.
  - Spivak 6y ago
    Thank you! Sure fine at some base level there is still technically market in a purely anarcho-capitalist system but that doesn't suddenly imply that the markets we have aren't essentially a pseudo-central planning systems that actually work. A market is useless if it doesn't actually allocate goods and labor efficiently and in the way people want.
  - reedjosh 6y ago
    > Markets fail or succeed because of improper or proper governance. I have yet to see proper governance last long enough to be of any note and worse governance tends to quickly flip to favor the powerful.
    - ajmurmann 6y ago
      Hong Kong and Singapore might be great examples
      - reedjosh 6y ago
        TBH, I'm ignorant of these countries' regulatory systems. You may be right. What makes them good examples?
        ardy42 6y ago
        The latter is famously authoritarian capitalist, and the former just gutted its civil liberties? Also, IIRC, they both benefited from being trade gateways into the PRC economy, especially when it was more closed than it is now.
        ajmurmann 6y ago
        This podcast will do a much better job at explaining how solid economic policy lead success in Hong Kong: http://www.econtalk.org/neil-monnery-on-hong-kong-and-the-architect-of-prosperity/ http://www.econtalk.org/neil-monnery-on-hong-kong-and-the-ar... Of course Hong Kong is now different, but that's not because the government changed its policies, but there is a different government in power. Singapore had the benefit of a trade port, but it kept importance as such and expanded into becoming a important financial center as well as punching well over its weight in terms of innovation. They have invested in education and provide a stable environment for business.
- deleted 6y ago
  [deleted]
- MrMan 6y ago
  This is why I called Bitcoin “naive and antisocial”. I perceive a long-standing willingness on the part of crypto proponents to willfully ignore why monetary policy exists and how it is tied to society’s needs. Self-governance cannot be cast aside in favor of a currency managed by a network of miners remote from the Economic output, debt and other expressions of local social economy. I called it evil and I wasn’t being hyperbolic.
  - dorgo 6y ago
    (self-)governance is big topic in crypto. I predict that crypto will reinvent all the societal structures and processes to form a digital market+government+jurisdiction because a currency alone can't address all the problems you mentioned.
  - nathias 6y ago
    Of course monetary policy is good for the guys implementing it, crypto is here for the rest of us. Making monetary policy tied to a currency and immutable is one of the great benefits of crypto, akin to having monetary policies be part of constitution.
    - MrMan 6y ago
      You can’t opt out of society without consequences
      - cmoscoso 6y ago
        Do you mean society or big government?
    - eek04_ 6y ago
      I don't believe it will be a benefit. Current monetary policy is to keep inflation positive and low, while addressing economic shocks that make money velocity low by increasing the supply. A low positive inflation effectively makes all prices that are denominated in a fixed amount of the currency slowly lower. This helps the economy - ie, people and companies acting in the economy - deal with changes more easily, since their contracted prices are going down. It also avoids the problem with deflation: Keeping money to spend in the future makes more sense to an individual, thus money velocity goes down, thus less things happen (and all actors earn less.) That's also why increasing the money supply for crises is good: It allows the same activity to go on, even if each unit of currency moves less. People can get paid the same even if everybody save up money. If there's a fixed amount of currency, they can't, since the currency that would be used to pay them is now bound up in their savings.
vishnugupta 6y ago
> As long as a country cannot print usd itself, this is a fast shortcut to unemployment, hunger, etc... We don’t even need to make up hypothetical examples. We have a live one in Greece. The Greek citizens went through this exact ordeal for the exact reason you stated. They couldn’t print EUR and the ECB wouldn’t extent monetary support to Greek government.
- LudwigNagasena 6y ago
  The Greek citizens went through this because the Greek government has been lying for many years in its financial reports.
  - deeeeplearning 6y ago
    Lol found the German
    - Mtinie 6y ago
      Is the assertion wrong? Cursory, recent research and my own recollection matches with the comment you were responding to. https://www.ft.com/content/33b0a48c-ff7e-11de-8f53-00144feabdc0 https://www.ft.com/content/33b0a48c-ff7e-11de-8f53-00144feab...
      - deeeeplearning 6y ago
        I think the real reason is that Greece was more or less forced by the EU to accept austerity and a bad loan it can't possibly repay. The leadup to this was irrelevant.
  - m00dy 6y ago
    I agree.
  - dmpk2k 6y ago
    Both can be true (and are).
- 6y ago
reedjosh 6y ago
> Say everyone in an unstable economy were paid in usd. Then that country would be paying the unseen tax of inflation as the US banking system prints more and more USD. Said country would basically be a US colony.
- variaga 6y ago
  TIL Zimbabwe, Ecuador, El Salvador, Palau, East Timor and the British Virgin Islands are all "basically US colonies". What about countries that don't use the dollar as currency directly, but keep a fixed exchange rate to the dollar - they would be paying the unseen tax of inflation too, right? With a fixed exchange rate if the dollar value falls, so will the value of their currency. So that would mean Hong Kong, Cuba, Jordan and the Netherlands are all "basically US colonies" too. (China may be kind of surprised about that first one.) Does this work for other currencies, or just $USD? Are Martinique, Andorra, Montenegro and Kosovo "basically EU colonies"? - they all use the Euro as currency, but are not part of either the EU or the EEA. We don't actually have to hypothesize about what would happen if an unstable economy switched everything over to dollars (or Euros), either directly or by exchange rate peg, because it has already happened, many times. https://www.worlddata.info/currencies/usd-us-dollar.php https://www.worlddata.info/currencies/usd-us-dollar.php
  - reedjosh 6y ago
    Your argument from incredulity doesn't make what I say less true. Maybe my language was a bit strong, but there's no denying if somebody can freely make more of something you value, then they're gaining from your use of said valuable.
  - IG_Semmelweiss 6y ago
    Montenegro and Ecuador are effective colonies in their most developed areas. Most of the valuable property in major metros is owned directly by US-based or EU-based emigrees , who paid top dollar for property that has a ROC duration in excess of 20 years. Most of the metro areas on these countries are rapidly turning hollow projects which cheap rents or undeveloped land. It is quickly becoming like paris. Flat rental 2000 EUR. Buy price: 2M EUR. When someone that is not a local is taking all your valuable land... Thats the textbook definition of colony
jariel 6y ago
"Strong currencies are not the solution to poor governance." Yes they are. It's really upside down that you'd point out that 'governments can just print money to pay people!' as somehow being an advantage of good governance. Well, partly, but it depends on a high degree of integrity, if absent, will entail total dissolution. In absence of a government with integrity, then a 'strong currency' such as one that the government has no control over, say a Caribbean Island that uses USD for example, is preferable to anything else. "Good governance and democracy makes a country and its currency strong. Not vice versa. " First - democracy has nothing to do with it. Second - 'good governance' is the opposite of printing money to pay bills. In an unstable economy, USDs or Euros are preferable to worthless paper or Bitcons.
Wowfunhappy 6y ago
Yeah, it’s not great, but I don’t think using Bitcoin solves any of those problems...
totalZero 6y ago
I don't think the answer to this question plays out the way you want it to... 1. Countries that have natural resources can raise capital when they need to, either by selling/taxing rights to those resources or by selling nationalized resources. Ecuador for example uses the dollar and also produces about a half of a million barrels of oil per day. 2. For many developing countries, the whole point of using the dollar is that it precludes monetary over-engineering or corrupt practices that give rise to inflation. This makes the economy safer for the have-nots, who have fixed local-denominated savings and/or earn a fixed local-denominated wage. 3. Simply using the dollar makes it easier to facilitate trade, tourism, and remittances. Panama does a lot of shipping and transit. Ecuador is a tourist destination. Remittances are the major source of foreign income to El Salvador. Those countries that accept dollars and also maintain a dollar-pegged local currency are able to conduct monetary policy while also establishing a measure of confidence in the stability of their currency.
- IG_Semmelweiss 6y ago
  I think this is only half the story. What you are missing in your detail is that ecuador actually got itself into a very serious currency bind precovid, and it seems to be staying that way. So this would validate parent comment and actually negate your assertion that parent was incorrect. That being said, this is half the story. And its the other part that matters. This is the first time ecuador gets in trouble post USD adoption. Where it goes from here will directly prove or disprove the very thesis, that parent comment assumed was a foregone conclusion. Thus , your refutation may be correct after all, except for what i believe are different reasons.
  - totalZero 6y ago
    > ecuador actually got itself into a very serious currency bind precovid, and it seems to be staying that way. Ecuador had protests over removal of fuel subsidies to satisfy IMF debt conditions in Oct 2019. Hard to see how that's a "currency bind" in any sense. > This is the first time ecuador gets in trouble post USD adoption. Uh...what? You're just making stuff up. Ecuador defaulted on two bond issues in 2008. Ecuador had to borrow billions from China in 2015 when petroleum prices collapsed. This affected the country for two or three years. Public sector workers had to wait months for their salaries at times. In an alternate reality where Ecuador uses its own currency, the government would have printed its way through that problem and the resulting devaluation would have hurt everyone with savings or wages.
wonderwonder 6y ago
This is an accurate statement when approached from a top down nation / state level. Approached from the level of an average person living in countries with highly volatile currencies, they just want a currency that is not reliably going to be less than it was the day before. It allows those people the opportunity to detach from the issue of "poor governance" over which they have no control and gives them some independence from it. This is especially true for refugees. They run the very real risk of being killed for any money they are carrying but if one has one's keys memorized then no one knows you have funds and you are somewhat safer. Over 1/3 of the world's population lives in countries with declining or unstable democracies, crypto currencies provide a small cushion from that in some situations.
- simiones 6y ago
  If the economy is not working, people won't get the value they are used to. This can essentially be handled in 2 ways: 1. Inflation, which means that everyone is getting the money they are owed, but can't do as much with them 2. Defaults/bankruptcy/breach of contract - people and businesses just run out of money and stop paying their debts If your country can print money, you will be in situation 1. If your country can't print money (e.g. because it is using BTC or USD or Euros or whatever currency they can't control), then you'll be in situation 2. I for one prefer situation 1, because there is a chance of recovery from there, and normal life can go on somewhat naturally.
  - wonderwonder 6y ago
    This is a fair point. I have never seen btc taking the place of a nations money. Rather I see it as an alternative means of storing value that can also be used as a means of exchange independent of the monetary supply. BTC will always be measured in dollars/euros/etc.
conanbatt 6y ago
The gov can still pay its employees with its own currency. There are plenty of bimonetary economies.
vivekd 6y ago
>Good governance and democracy makes a country and its currency strong. Not vice versa. The issue with this argument is that good government is a very hard problem that in many cases has no clear immediate solutions. While things like crypto many not be a solution they are a vood stopgap solution for the problems created by bad governments - at least until we can get thw good governance problem solved
CryptoPunk 6y ago
>>What happens? How can the government keep paying its own employees? How does it pay retiree checks? How does it subsidize farming when needed? As long as a country cannot print usd itself, this is a fast shortcut to unemployment, hunger, etc... In these countries, those in power rob the public blind. They steal the country's wealth and do anything they can to hold on to and expand their power. Giving the state more power just means giving the elite more power to rob. The point is that when a state is inept and driving the country into bankruptcy, the grey/black market can be a lifeline keeping people alive. You don't want to chain the population to the efficacy of state, by closing off avenues to non-state payment-systems and currencies. The internet, and the currencies built on it, can provide alternate, superior governance systems for financial and economic collaboration that can operate in parallel with state-administered ones.

l_pan_ 6y ago

Well said. I believe this is why the US and many others abandoned the gold standard.

ardy42 6y ago

> Strong currencies are not the solution to poor governance. Good governance and democracy makes a country and its currency strong. Not vice versa. That's a good point. Too many people propose individualist solutions to social problems, and all their "solution" would do is make the social problem worse. I think that stems often stems from an overzealous faith in free markets, which leads to a distorted idea that individual self interest factored over all of society always results in social benefits, so you only need to consider things from the perspective of an individual (which is also far more familiar to most people). Sometimes individual self interest does lead to social benefits, but often it doesn't.

imtringued 6y ago
Markets only exist within the context of a political system. They are just a tool to reach a certain policy outcome. The idea of using the free market to replace poor governance is laughable. It's the opposite. You have to set the right policies and incentives and only then will the free market show its true beauty. Markets fail or succeed because of improper or proper governance. It's like a genetic/ML algorithm that is optimizing for a cost function. If your cost function is awful your algorithm will be awful but that's not an argument in favor of getting rid of cost functions entirely.
- Spivak 6y ago
  Thank you! Sure fine at some base level there is still technically market in a purely anarcho-capitalist system but that doesn't suddenly imply that the markets we have aren't essentially a pseudo-central planning systems that actually work. A market is useless if it doesn't actually allocate goods and labor efficiently and in the way people want.
- reedjosh 6y ago
  > Markets fail or succeed because of improper or proper governance. I have yet to see proper governance last long enough to be of any note and worse governance tends to quickly flip to favor the powerful.
  - ajmurmann 6y ago
    Hong Kong and Singapore might be great examples
    - reedjosh 6y ago
      TBH, I'm ignorant of these countries' regulatory systems. You may be right. What makes them good examples?
      - ardy42 6y ago
        The latter is famously authoritarian capitalist, and the former just gutted its civil liberties? Also, IIRC, they both benefited from being trade gateways into the PRC economy, especially when it was more closed than it is now.
      - ajmurmann 6y ago
        This podcast will do a much better job at explaining how solid economic policy lead success in Hong Kong: http://www.econtalk.org/neil-monnery-on-hong-kong-and-the-architect-of-prosperity/ http://www.econtalk.org/neil-monnery-on-hong-kong-and-the-ar... Of course Hong Kong is now different, but that's not because the government changed its policies, but there is a different government in power. Singapore had the benefit of a trade port, but it kept importance as such and expanded into becoming a important financial center as well as punching well over its weight in terms of innovation. They have invested in education and provide a stable environment for business.
deleted 6y ago
[deleted]
MrMan 6y ago
This is why I called Bitcoin “naive and antisocial”. I perceive a long-standing willingness on the part of crypto proponents to willfully ignore why monetary policy exists and how it is tied to society’s needs. Self-governance cannot be cast aside in favor of a currency managed by a network of miners remote from the Economic output, debt and other expressions of local social economy. I called it evil and I wasn’t being hyperbolic.
- dorgo 6y ago
  (self-)governance is big topic in crypto. I predict that crypto will reinvent all the societal structures and processes to form a digital market+government+jurisdiction because a currency alone can't address all the problems you mentioned.
- nathias 6y ago
  Of course monetary policy is good for the guys implementing it, crypto is here for the rest of us. Making monetary policy tied to a currency and immutable is one of the great benefits of crypto, akin to having monetary policies be part of constitution.
  - MrMan 6y ago
    You can’t opt out of society without consequences
    - cmoscoso 6y ago
      Do you mean society or big government?
  - eek04_ 6y ago
    I don't believe it will be a benefit. Current monetary policy is to keep inflation positive and low, while addressing economic shocks that make money velocity low by increasing the supply. A low positive inflation effectively makes all prices that are denominated in a fixed amount of the currency slowly lower. This helps the economy - ie, people and companies acting in the economy - deal with changes more easily, since their contracted prices are going down. It also avoids the problem with deflation: Keeping money to spend in the future makes more sense to an individual, thus money velocity goes down, thus less things happen (and all actors earn less.) That's also why increasing the money supply for crises is good: It allows the same activity to go on, even if each unit of currency moves less. People can get paid the same even if everybody save up money. If there's a fixed amount of currency, they can't, since the currency that would be used to pay them is now bound up in their savings.

vishnugupta 6y ago

> As long as a country cannot print usd itself, this is a fast shortcut to unemployment, hunger, etc... We don’t even need to make up hypothetical examples. We have a live one in Greece. The Greek citizens went through this exact ordeal for the exact reason you stated. They couldn’t print EUR and the ECB wouldn’t extent monetary support to Greek government.

LudwigNagasena 6y ago
The Greek citizens went through this because the Greek government has been lying for many years in its financial reports.
- deeeeplearning 6y ago
  Lol found the German
  - Mtinie 6y ago
    Is the assertion wrong? Cursory, recent research and my own recollection matches with the comment you were responding to. https://www.ft.com/content/33b0a48c-ff7e-11de-8f53-00144feabdc0 https://www.ft.com/content/33b0a48c-ff7e-11de-8f53-00144feab...
    - deeeeplearning 6y ago
      I think the real reason is that Greece was more or less forced by the EU to accept austerity and a bad loan it can't possibly repay. The leadup to this was irrelevant.
- m00dy 6y ago
  I agree.
- dmpk2k 6y ago
  Both can be true (and are).
6y ago

reedjosh 6y ago

> Say everyone in an unstable economy were paid in usd. Then that country would be paying the unseen tax of inflation as the US banking system prints more and more USD. Said country would basically be a US colony.

variaga 6y ago
TIL Zimbabwe, Ecuador, El Salvador, Palau, East Timor and the British Virgin Islands are all "basically US colonies". What about countries that don't use the dollar as currency directly, but keep a fixed exchange rate to the dollar - they would be paying the unseen tax of inflation too, right? With a fixed exchange rate if the dollar value falls, so will the value of their currency. So that would mean Hong Kong, Cuba, Jordan and the Netherlands are all "basically US colonies" too. (China may be kind of surprised about that first one.) Does this work for other currencies, or just $USD? Are Martinique, Andorra, Montenegro and Kosovo "basically EU colonies"? - they all use the Euro as currency, but are not part of either the EU or the EEA. We don't actually have to hypothesize about what would happen if an unstable economy switched everything over to dollars (or Euros), either directly or by exchange rate peg, because it has already happened, many times. https://www.worlddata.info/currencies/usd-us-dollar.php https://www.worlddata.info/currencies/usd-us-dollar.php
- reedjosh 6y ago
  Your argument from incredulity doesn't make what I say less true. Maybe my language was a bit strong, but there's no denying if somebody can freely make more of something you value, then they're gaining from your use of said valuable.
- IG_Semmelweiss 6y ago
  Montenegro and Ecuador are effective colonies in their most developed areas. Most of the valuable property in major metros is owned directly by US-based or EU-based emigrees , who paid top dollar for property that has a ROC duration in excess of 20 years. Most of the metro areas on these countries are rapidly turning hollow projects which cheap rents or undeveloped land. It is quickly becoming like paris. Flat rental 2000 EUR. Buy price: 2M EUR. When someone that is not a local is taking all your valuable land... Thats the textbook definition of colony

jariel 6y ago

"Strong currencies are not the solution to poor governance." Yes they are. It's really upside down that you'd point out that 'governments can just print money to pay people!' as somehow being an advantage of good governance. Well, partly, but it depends on a high degree of integrity, if absent, will entail total dissolution. In absence of a government with integrity, then a 'strong currency' such as one that the government has no control over, say a Caribbean Island that uses USD for example, is preferable to anything else. "Good governance and democracy makes a country and its currency strong. Not vice versa. " First - democracy has nothing to do with it. Second - 'good governance' is the opposite of printing money to pay bills. In an unstable economy, USDs or Euros are preferable to worthless paper or Bitcons.

Wowfunhappy 6y ago

Yeah, it’s not great, but I don’t think using Bitcoin solves any of those problems...

totalZero 6y ago

I don't think the answer to this question plays out the way you want it to... 1. Countries that have natural resources can raise capital when they need to, either by selling/taxing rights to those resources or by selling nationalized resources. Ecuador for example uses the dollar and also produces about a half of a million barrels of oil per day. 2. For many developing countries, the whole point of using the dollar is that it precludes monetary over-engineering or corrupt practices that give rise to inflation. This makes the economy safer for the have-nots, who have fixed local-denominated savings and/or earn a fixed local-denominated wage. 3. Simply using the dollar makes it easier to facilitate trade, tourism, and remittances. Panama does a lot of shipping and transit. Ecuador is a tourist destination. Remittances are the major source of foreign income to El Salvador. Those countries that accept dollars and also maintain a dollar-pegged local currency are able to conduct monetary policy while also establishing a measure of confidence in the stability of their currency.

IG_Semmelweiss 6y ago
I think this is only half the story. What you are missing in your detail is that ecuador actually got itself into a very serious currency bind precovid, and it seems to be staying that way. So this would validate parent comment and actually negate your assertion that parent was incorrect. That being said, this is half the story. And its the other part that matters. This is the first time ecuador gets in trouble post USD adoption. Where it goes from here will directly prove or disprove the very thesis, that parent comment assumed was a foregone conclusion. Thus , your refutation may be correct after all, except for what i believe are different reasons.
- totalZero 6y ago
  > ecuador actually got itself into a very serious currency bind precovid, and it seems to be staying that way. Ecuador had protests over removal of fuel subsidies to satisfy IMF debt conditions in Oct 2019. Hard to see how that's a "currency bind" in any sense. > This is the first time ecuador gets in trouble post USD adoption. Uh...what? You're just making stuff up. Ecuador defaulted on two bond issues in 2008. Ecuador had to borrow billions from China in 2015 when petroleum prices collapsed. This affected the country for two or three years. Public sector workers had to wait months for their salaries at times. In an alternate reality where Ecuador uses its own currency, the government would have printed its way through that problem and the resulting devaluation would have hurt everyone with savings or wages.

wonderwonder 6y ago

This is an accurate statement when approached from a top down nation / state level. Approached from the level of an average person living in countries with highly volatile currencies, they just want a currency that is not reliably going to be less than it was the day before. It allows those people the opportunity to detach from the issue of "poor governance" over which they have no control and gives them some independence from it. This is especially true for refugees. They run the very real risk of being killed for any money they are carrying but if one has one's keys memorized then no one knows you have funds and you are somewhat safer. Over 1/3 of the world's population lives in countries with declining or unstable democracies, crypto currencies provide a small cushion from that in some situations.

simiones 6y ago
If the economy is not working, people won't get the value they are used to. This can essentially be handled in 2 ways: 1. Inflation, which means that everyone is getting the money they are owed, but can't do as much with them 2. Defaults/bankruptcy/breach of contract - people and businesses just run out of money and stop paying their debts If your country can print money, you will be in situation 1. If your country can't print money (e.g. because it is using BTC or USD or Euros or whatever currency they can't control), then you'll be in situation 2. I for one prefer situation 1, because there is a chance of recovery from there, and normal life can go on somewhat naturally.
- wonderwonder 6y ago
  This is a fair point. I have never seen btc taking the place of a nations money. Rather I see it as an alternative means of storing value that can also be used as a means of exchange independent of the monetary supply. BTC will always be measured in dollars/euros/etc.

conanbatt 6y ago

The gov can still pay its employees with its own currency. There are plenty of bimonetary economies.

vivekd 6y ago

>Good governance and democracy makes a country and its currency strong. Not vice versa. The issue with this argument is that good government is a very hard problem that in many cases has no clear immediate solutions. While things like crypto many not be a solution they are a vood stopgap solution for the problems created by bad governments - at least until we can get thw good governance problem solved

CryptoPunk 6y ago

>>What happens? How can the government keep paying its own employees? How does it pay retiree checks? How does it subsidize farming when needed? As long as a country cannot print usd itself, this is a fast shortcut to unemployment, hunger, etc... In these countries, those in power rob the public blind. They steal the country's wealth and do anything they can to hold on to and expand their power. Giving the state more power just means giving the elite more power to rob. The point is that when a state is inept and driving the country into bankruptcy, the grey/black market can be a lifeline keeping people alive. You don't want to chain the population to the efficacy of state, by closing off avenues to non-state payment-systems and currencies. The internet, and the currencies built on it, can provide alternate, superior governance systems for financial and economic collaboration that can operate in parallel with state-administered ones.