What the use of Bitcoin instead of fiat money would do in the countries with the Welfare State was prophesied in the 90’s in the sovereign individual

Twenty-five years ago, at the end of the 90s, people began to talk about sovereign individual. An individual who no longer belongs to any nation-state, but is globalist and moves like a fish in water in a fully integrated economy.

The greatest exponent of this movement was the book by James Dale Davidson, published in 1997. In this book he prophesies a series of things that fell apart quickly, due to the attacks of September 11, 2001. There it was seen that the nation-states still imported and soon, in the 2007 crisis it was also seen that globalization had its problems too.

The sovereign individual

Yet the ideas of the sovereign individual were innovative and interesting. A man who depended on his own decisions, who was not a simple pawn in a structure, a man who could work anywhere in the world, who felt part of something global and who did not have to rely on a paternalistic state.

This sovereign individual would move with individual responsibility, in a world where information and education are fundamental. And where the collapse of nation-states leaves people orphans but from which a new eliteThese individuals who accept the new situation.

Bitcoin as a resurgence of the sovereign invidudo

The various crises that we have experienced since the 1990s have made it clear that this transition towards the sovereign individual is not so easy. States are still powerful and there is no more to see the border closures due to the covid-19 crisis last year. Where it seemed that freedom of movement and globalism were imposed, it was seen that in reality there are coercive forces that can prevent it if required.

But a new paradigm has also emerged, Bitcoin and cryptocurrencies, which can do resurface the movement of the sovereign individual in a very important way. If these currencies were imposed on fiat money, the nation-states would definitively collapse and give way to the invidivual sovereign.

Taxes as the basis of the nation-state

Tax collection is necessary for states to function. You can only be coercive by ultimately having police and army. And Bitcoin and other cryptocurrencies can impede this collection role of the State and therefore, its ability to have power.

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In a state where people use cryptocurrencies the state has no possible way to collect income or value added taxes. The only collection capacity of the State would be on property (housing, practically, since the ownership of the shares of the companies could well go to tax havens).

In such a situation, states would collapse. They would not have the capacity to provide necessary services. The individuals would be sovereign of themselves, they would not have a State to which they could take refuge in the face of problems. Sovereignty has this double aspect.

Is it good to be a sovereign individual?

Among the maximalists of Bitcoin and his position completely against the interference of the State in our lives and those who despise individual freedom there are middle terms that, in my opinion, are much healthier.

I like individual freedom, without a doubt. But also that there are certain guarantees on the part of a State. That we live in a safe country, with hardly any crime, is a consequence of the state’s ability to collect taxes.

If you have a securities account abroad (Giro, Trade Republic and co), you have to report the investments to the State: we will tell you how to do it

That we have unemployment insurance, pensions, infrastructure, Health coverage against unexpected problems regardless of our economic position is, of course, good news for society. And a world without a State, in which each one has to individually seek their security (physical, economic and health, to give three examples) is certainly a much worse world than the current one.

For me the sovereign individual is a mistake. As it would be a world where fiat money would disappear permanently in pursuit of a society based on Bitcoin and derivatives. The prosperity of humanity has been associated with the ability of states to manage taxes and a bureaucracy capable of meddling, in a very partial way, in people’s lives. Removing this system should only be done if there is a much better proposition and I am afraid that is not the case.


Source: El Blog Salmón by www.elblogsalmon.com.

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