Bitcoin: Riding High, But in Crisis

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As I write this, the world’s most popular cryptocurrency sits at a near record price level — $2,800 US dollars buys one Bitcoin. While the price is volatile, it’s been on a fairly steady upward trend recently and its price graph for the last year looks like the proverbial “hockey stick” (last June it traded for around $600 per Bitcoin).

Mark Cuban — a billionaire investor who’s a billionaire investor precisely because he has a head for this kind of thing — thinks that Bitcoin is due for a fall. He tweets: “I just don’t know when or how much it corrects. When everyone is bragging about how easy they are making $=bubble.”

Personally, I’m not worried about a “bubble” per se (Cuban wouldn’t be the first guy to incorrectly assay Bitcoin’s future in terms of how high the price can go). Rather, it seems to me that Bitcoin remains in what has now stretched out into months of true existential crisis. It’s in danger not of “correcting,” but of dying.

The problem: Regular people can’t buy and sell regular things in the usual way with it at the moment.  The transaction fees are too high and the transaction times are too long.

For example, I just spent about $15 from my Bitcoin wallet. Paying the lowest “mining fee” required to make the network process the transaction ate up 48% of that $15 … and I have no idea how long it will take for the $7.80 of Bitcoin that was left to get to where I sent it (a recent transaction took about 30 hours).

Any currency, digital or otherwise, has to function well as a “medium of exchange” if people are going to use it. That is, they need to be able to actually buy and sell stuff with it. If they can’t, it’s also not going to be something they trust as a “store of value” to save for later buying and selling.

 

Bitcoin has come up against the problem of more transactions than the network can handle quickly. Transaction costs in the form of mining fees have gone through the roof, while transaction speed has slowed to a crawl. It’s a train wreck as a medium of exchange and if that’s not fixed it will soon cease to be a viable store of value.

Solutions such as “Bitcoin Unlimited” and “Segregated Witness” have been proposed, but every time an agreement among developers and miners on how to reduce costs and speed up transactions seems near, things fall apart.

A year from now, one of two situations will exist:

It will be possible to spend Bitcoin worth $1 US on a soda at your local convenience store using your phone, a debit-style card, or a “hardware wallet” at a transaction cost of 5 cents or less and in a minute or less.

Or, Bitcoin will be a fondly remembered fad that’s been replaced in actual commerce by something better.

Cryptocurrency is here to stay. Bitcoin’s miners and developers need to decide whether they want to be part of its future.

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

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Drug Overdose Deaths, 2016: Casualties of War

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Heroin being “cooked” prior to injection (Photo credit: Wikipedia)

Drug overdose is now the leading cause of death among Americans under 50, the New York Times‘s Josh Katz reports. In 2016, overdoses claimed somewhere between 59,000 and 65,000 lives.

That’s more American lives than were lost in the Vietnam war. It’s 20 times the casualty count of 9/11. It’s half again as many deaths as attributed to the “gun violence” we hear so much about in its peak year, 1994.

Katz pins the blame  for these deaths on use, abuse, and sometimes accidental overdose of heroin, fentanyl, and prescription opioid painkillers. He goes along with the current fad of calling the phenomenon an “opioid epidemic.” That’s soothingly simple.  The word “epidemic” implies an infectious agent to which we need attribute neither consciousness nor responsibility.

But those 60,000 or so dead Americans aren’t victims of a faceless “epidemic.” They’re casualties of a decades-long war waged on the American public by the federal and state governments. It’s called the war on drugs, and the Times  piece, curiously, doesn’t refer to it even in passing.

Here’s what life would look like in an America at peace: If you wanted an opium product for either medical or recreational purposes, you’d walk into your nearest pharmacy and buy it.

You’d get a product of known quality, quantity and purity. As long as you followed the instructions on the box correctly, your chance of overdosing would be infinitesimal.

You’d probably stop on your way home from work for your daily fix, perhaps with the milk you forgot to get while grocery shopping. It would be cheap enough that you could support your habit with a regular job like the millions of smokers, alcoholics and Starbucks customers who don’t have to burglarize homes and steal car stereos to support their habits.

Yes, that simple. Really. In fact, that’s exactly how it was before the war.

Here’s what America at war looks like:

Tens of thousands of deaths, hundreds of thousands of POWs in local, state and federal prisons, and tens of billions of your tax dollars to keep up the pace of killings and cagings, year after year, decade after decade.

Rule by people simultaneously more lethal to Americans than, and morally inferior to, Osama bin Laden (he never tried to tell us he was murdering us for our own good, did he?).

Oh, and the people who want the drugs are going to get them anyway.

Which America sounds better to you?

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

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CIA Torture Report: Where’s Our Next Heroic Whistleblower?

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Inmate being tortured by US interrogators at Abu Ghraib prison in Iraq (Photo credit: Wikipedia)

In December of 2014, The US Senate’s  Select Committee on Intelligence issued a report on the Central Intelligence Agency’s “inadequate and deeply flawed” interrogation techniques, concluding that those practices were “not effective” and that they were “far more brutal” than the public — or Congress — had been led to believe.

The document is commonly referred to as “the CIA torture report” for obvious reasons. Among other atrocities, it describes a detainee being chained naked to a concrete floor until he died of hypothermia, and other detainees being subject to “rectal feeding.”

Or, rather, it supposedly describes such things. The public has never seen the actual report, only summaries and excerpts.

In a rare act of legislative heroism, US Senator Dianne Feinstein (D-CA), whose record of being wrong on the issues comes close to perfection over her 25 years in the Senate, had the report distributed to various executive branch agencies so that it would eventually be revealed through the Freedom of Information Act.

But now the Trump administration is moving to prevent that. US Senator Richard Burr (R-NC), the Select Committee’s chair, has requested the return of all extant copies of the report to the Senate (which is exempt from FOIA) and the administration is complying with that request.

What do the CIA, the US Senate, and the White House have to hide? My guess is quite a bit.

Should they be allowed to hide those things from the taxpayers who pay the bills and whose lives are put at risk by the criminal acts of the US intelligence community? Absolutely not.

Will they get away with hiding it? Not forever. The days of governments being able to permanently bury secrets are over, thanks to heroes like Chelsea Manning, Edward Snowden, and the folks at WikiLeaks.

It’s a near certainty that several executive branch employees put copies of the report away for safe-keeping precisely to safeguard the public interest in a situation such as this.

In fact, we may now see the report sooner than we otherwise would have. A civil servant who was content to let the FOIA process run its course, if it was allowed to, may treat this development as a trigger event for showing us what our government is hiding from us.

Good. Trump, Burr and the CIA are cats covering up their output in the litter box.  Time for someone responsible to clean up — with, pun intended, a scoop.

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

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