Money as a System-of-Control

The topic of today’s talk is an interesting property
of money that I want to explore with you. I am calling this [talk],
“Inside Out: [Money as a System of Control].” Who here wants to tell me what the four
primary functions of money are? Anybody? [AUDIENCE] Value exchange?
[ANDREAS] Medium of exchange, that is one. [AUDIENCE] Fungibility?
[ANDREAS] Store of value, that is two. [AUDIENCE] Fungibility? [ANDREAS] No.
That is not a use case for money, but it is a property. Two more. Unit of account, very good.
What is the fourth? System-of-control (SoC). What? I don’t remember reading that.
[Laughter] System of control, as it turns out. We have had money for tens of thousands of years.
It is really hard to tell how far back money goes. But the money we have today is very different
from the money we have had in the past; something changed in the last 50 years that
has fundamentally altered the course of money, of currency, [which is a] system [for]
communicating value to other people. We have the three components: medium of exchange
(MoV), unit of account (UoA), and store of value (SoV). Those have been around for millenia.
And then something happened. In 1970, Richard Nixon signed the Bank Secrecy
Act and turned money into a system of control. A system of control that uses money as a political tool,
to control who is able to send or receive it… and who [you] are able to send money to. Ultimately, it aims [for] the complete surveillance
of all financial transactions worldwide. Complete, total, totalitarian financial surveillance. This change, 50 years ago, has gradually
percolated throughout every country in the world, every financial service in the world,
every bank in the world. In 1970, Richard Nixon deputised the financial services
field, to turn them into a branch of law enforcement. Law enforcement that is beyond borders,
beyond jurisdictions, beyond due-process, beyond political democratic control and recourse. A cop can confiscate your money. A judge
can sign a warrant to freeze your accounts. A bank can do both without authorisation from anyone
and there is nothing you can do about it. This applies world-wide. Money as a system of control
supercedes all other functions of money. When money is turned into an enforcement tool,
the other functions start eroding. It is no longer the best medium of exchange,
because its function as a medium of exchange… is subordinate to its function as a system
of law enforcement, a system of control. The system of control aspect corrupts everything. We are now 25 years into the internet revolution. Smartphones, cellphones, dumb phones… [tools for
accessing the internet] have propagated out to… more than 2.5 billion people who have
never had these technologies before. But where is finance?
Lagging fifteen to twenty years behind. [Financial services] have not yet reached
2.5 billion people who are completely unbanked; 4 billion people underbanked. Only about 1.5 billion people have the
full, privileged, elite form of banking… that we enjoy in most western liberal democracies. Even there, there are tiers of access and control.
How many people in this room are accredited investors? Mhm, what a lovely bunch. [Laughter] That puts you in the 1/10 of the 1/10
of the 1/10 percentile of the world. There are tiers within the financial system. Some people who have better access and recourse,
and some people who have complete immunity. Some people can commit crimes against millions:
robo foreclosures, Libor fraud, rigging the gold markets. And no one will ever go to jail. Why? Because when money becomes a system of control,
financial services companies become deputies… in this system of enforcement and control. As deputies, they get some perks.
One of the perks is: they never go to jail. Well, with a few exceptions; there are some
fundamental rules that always apply to our society. Bernie Madoff went to jail. He made the mistake of
stealing from rich people. Don’t do that! [Laughter] Foreclose [the homes of] 10 million poor people? Create
3.5 million fake accounts in Wells Fargo? No problem. Lose 143 million private records of
individuals [through a hack] at Equifax? Let’s see some bets.
How many executives [will] go to jail? None. A system of control corrupts the basis of money until
it can no longer function as a medium of exchange. It breeds economic exclusion. We are now 25 years into the era of the internet and
we are reaching fewer people with economic inclusion. We are actually backtracking historically. Increasingly, entire countries are being
cut off from the world financial system. You don’t act in the best interests of the United States? You lose your SWIFT code, you are no
longer part of the wire transfer network. You [will] submit to the universal jurisdiction
of American courts, like Switzerland had to do, or you lose access to international banking. You lose access to the reserve currency,
you lose access to the lifeblood [of trade]. This devil’s bargain has made financial services
unassailable from a point of competition. They are surrounded by a thicket of regulations;
these regulations are not about consumer protection, consumers are most certainly not protected. They are most certainly about
the system of control of money. They are about the policy enforcement, and sometimes
politics enforcement, that comes with money. Money does not flow freely. I have some bad news. Those gold bars surrounding and
protecting banks from competition are a gilded cage. A cage that keeps them inside a system of
regulation, prevents competition from the outside, but also prevents them from acting on innovative
[ideas] in free markets, expanding their businesses, unless they subordinate it
to a system of control. The store-of-value [use case] no longer works;
you cannot store value in a currency… that can be confiscated at a whim,
frozen by any banker, at any point in time. That is not a stable store of value. You cannot use it as your currency reserve to buy oil,
or as your foreign exchange reserve in your country. If you cross the superpowers, they will cut off
your access and you will not be able to [buy] oil. You cannot use money as a medium of exchange
if you cannot exchange it freely with whoever you want. Gradually, the corruption spreads and spreads. Now, something new arrives on the horizon:
a system of money that [operates] on a network. It is first and foremost a medium of exchange, a store
of value, and one day (potentially) a unit of account. But it will never become a system of control;
it refuses to become a system of control. In fact, its design principles are about neutrality,
openness, borderless access, censorship resistance. The banks can’t play in that space. They are stuck
inside their gilded cage, playing cop for superpowers… and [only] offering [financial] services to
a tiny fraction of the human population. They are sacrificing 4 billion people on the
altar of poverty in order to create a nice, fake, bourgeois sense of security among
the middle class — by selling them lies. FDIC: ‘Don’t worry, your money is insured.’ Right? How many people here have FDIC or equivalent
insurance on their bank accounts? How many Greeks do you think had
insurance on their bank accounts? All of them. What happened to that?
[Their savings went] poof! in one afternoon. Vanished, with a 20% haircut. Whose insurance? Does it insure you or does it
insure the banks? What does it insure against? Small failure, not big failures.
Big failures are uninsureable. How many of you have money in banks?
None of you have money in banks. [Laughter] I mean, please. Many of you are lawyers, right?
You understand bailment. It is not your money. You have an “account,” which is a legal construct
that they give you in exchange for giving them… your money as an unsecured loan, so that
they can finance credit to their customers. Legally, you don’t own any of
the money that is in your account! You have a legal construct that possibly, maybe
entitles you to withdraw at the pace they [set], unless you cross the wrong person, go to the wrong
protest, associate with the wrong organisation, or vote for the wrong party. Sure, maybe that is not happening in Canada. But out of a hundred and ninety-four countries, this
model of turning money into a system of control… has taken off like wildfire,
because it is every dictator’s wet dream. It ensures that political dissent can be
snuffed at the bank, very effectively. It is one of the most effective
systems of control that exist. Now it has to face competition from a system
that will not do that, cannot be made to do that, will not yield or be co-opted. What is the response? “Bitcoin is a joke.”
“Cryptocurrencies are outside the system.” “Nobody wants to be outside the system.”
Guess what? There are 6 billion people out there. [Most of them] don’t want to be outside the
system; they would much rather be inside. But they haven’t been invited
and they probably won’t be. Many of them can’t do the things that are
necessary to be invited into the system. Guess what? There is an entire generation that
has discovered the two [vital] forms of power: the first form is voice,
the second form is exit. You either speak up with your voice, and
express your political will to force change. When that doesn’t work, you [opt for] the
second [vital[ power that all humans have: exit. Borders have been erected for millenia
to prevent exit, to slow down exit. You can’t easily emigrate, opt out, depart, exit. What happens when exit is not
a physical act, but a virtual act? What happens when people decide to exit
from the financial system in a virtual way? VR-exit? Bit-exit? [Laughter] You can keep the inside of the gilded cage. It is demographically stagnated, over-leveraged,
swimming in debt, and out of control. It serves a tiny sliver of the population. You can keep it. An entire generation of Millennials no longer
believe in that fiction of bank security, of deferred earnings, of interest rates and mortgages. They will exit; they are exiting in droves. Not just here, but even more so in the countries
where the existing system of insider finance… and the system of control are
used despotically, oppressively. China is exiting in droves and it has barely started. Bitcoin has been around for nine years.
What does the insider group do? What do the regulators do in response
to a system that cannot be regulated? They regulate the bits they can: the exchanges,
bank accounts, and national currency side of things. They shut down the on-ramps and off-ramps.
They say, “We will not let you take your money with you.” What do Millennials say to that?
“Dude… I don’t have any fucking money!” [Laughter] “All I have is my creative
potential, my spirit, my productivity.” “I can sell that directly for bitcoin without
an exchange, an on-ramp or an off-ramp.” “When I need to buy something,
I will use my digital currency directly… without re-entering your system
– to which I was never invited.” “Shut down the on-ramps, shut down the off-ramps.
I will stay on board. I will stay digital.” I won’t touch your gilded cage anymore,
because I don’t need you. I exit.” Thank you.

100 thoughts on “Money as a System-of-Control

  1. The bank cancelled my accounts today…. I saw this video months ago…. and it hit me again today at how true this is.

  2. If I was a girl he would have panties getting tossed at him.
    I like that dude…..but not that way….

    "Not that there's anything wrong with that." (Seinfeld)

  3. Ethereum is trying to turn crypto into a system of control. Essentially Buterin has 100% centralized control over it, and he has already leveraged that with DAO.
    It saddens me that Ethereum has value and people are investing in it 🙁

  4. once they regulate the internet connectivity… the ledger will need to find a different way to propogate… that's the only problem I see currently.

  5. Money has been a system of control not since 1970, but for millennia. It's force is exerted via its monopoly over a geographic region, Usury and taxes on it.

  6. The revolutionary spirit just continues to grow and grow. You are touching some deep, unconscious nerves and waking them. Very powerful.

  7. in december 2017 this vidjayo has 3k likes and 23 dislikes = ratio of 130.4 smart people for each idiot. good work team! and thanks AAntonop- very thankful to have your insights and explanations to refer others to.

  8. Please write a book about this topic & what you were talking about in your video: "Worse than Useless: Financial Surveillance"

  9. I'm surprised that cryptocurrencies haven't been met with more/quicker government resistance. Good. The more time they waste by holding meetings and writing reports, the more time cryptocurrencies will have to gain acceptance among more mainstream people than merely libertarians and ancaps.

  10. Is there a place to order thumbs-up buttons somewhere online, let's say in packs of 100? I want to throw a bunch of those on this video and YouTube only gives me one …

  11. 5:40 Bernie Madoff made he mistake of stealing from rich people. But foreclosing on 10 million poor people? No problem

  12. Such a great video.
    The 4 main banks here in Australia are freezing peoples bank accounts if they do business with a crypto exchange, they are trying to make it virtually impossible to take your money away from them and invest it in the crypto currencies. Governments taxing all your crypto. They are fighting hard to still be in control here in Australia.

  13. If you liked this video by Andreas, please review mine: On the Geopolitical Ramifications of Bitcoin: The Revolution Will Not Be Centralized.

  14. THE 16 MIN MARK IS THE BEST THING ANDREAS HAS EVER SAID …. THIS IS WHAT I SAID WHEN I FOUND BITCOIN I SWEAR TO GOD. It was literally one of the first times I felt a new type of freedom. I finally understood. Thank you Andreas

  15. Bitcoin enables a system of control as much as any other representation of something that does not exist. Unless the mechanism of capital accumulation is prohibited by equal distribution, massive inequality will never be effectively challenged in the political realm. So, what we use to represent capital will continue to serve a mask for the system of control it represents. .

  16. Six billion people are not going to trade their hard earned money for extreme buyingselling fees, low security, high learning curve, constant hacks, no FDIC security, massive price fluctuation, govt persecution, govt imprisonment, torture from criminals for your keys.

  17. He panders to little people, but his argument is mainly focused on how the System of Control affects countries and not individuals.

  18. Absolutely beautiful. I have made many mistakes and do have some regrets, I’ll make sure that my grandchildren understand these truths.

    Until Andreas I was ignorant about money. He has become our morning-star.

  19. Bitcoin isn't so different. I tried to get into it early and discovered I couldn't get any mining software to work. And when I asked for help the answer was always "pay us a tax and we'll help you." how is that a revolt against old money?

    Apartments can't be rented in America with Bitcoin. Not yet, not in most places. Until basic requirements for life are available with Bitcoin, then money remains king. And why would a landlord offer Bitcoin payments when they know they can't use Bitcoin to buy a car or their own house and so on.

    Bitcoin can buy toys and drugs and developer labor and that's about it so far. It seems to be up against a "great filter".

  20. Creators of independent money were murdered immediately (Kennedy, Kadhafi ). If these guys are alive it is another deception.

  21. When a nation is going down hill, they literally will make it impossible to get capital/money out of the country…. but bitcoin just leaps over their tyranny like the joke that it is.

    Crypto currency empowers the people where as this fiat money with fractional reserve system only empowers those who want to enslave.

    It’s so exciting to be alive, to see the downfall of these sleazy banks, so awesome!

  22. What can banks do to keep people from getting on board with Bitcoin? Could they force Phone companies to install software that would not allow you for access Bitcoin ? Or could they somehow limit your access to the Internet?

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