Notably, there have been a series of recent analyses and policies from central banks and governments which have started to surround efforts to suppress bitcoin, starting with the European Central Bank’s (ECB) report ‘The Distributional Consequences of Bitcoin’ (2018). This paper, criticised for ‘favouring a return to increasing wealth inequality while leaving poorer segments of society largely untouched’ and ‘reaffirming the existing status of bitcoin as portended to favour the early adopters’, has since been rebutted by many experts including Dr Murray A Rudd, Allen Farrington, Freddie New and Dennis Porter, who list the ECB’s failings in such research, including the omission of calling out bitcoin’s store of value parallel to gold, and ignoring its deep use in regions with authoritarian regimes, and for cheap, secure international transfers.
The experts’ response called out these themed policies, and labelled them what amounted to Chokepoint 2.0: a coordinated effort by centralised financial entities to choke decentralised assets such as bitcoin. Commentators such as Farrington and Porter say that, by contrast, bitcoin users are offered an open, non-discriminatory and inclusive platform under which paying for things, savings, trade and investment are achieved in a non-coercive and legally binding way without central interference (as opposed to CBDCs, which the ECB has proposed as one of the alternatives to bitcoin). The dispute also concerns the need to preserve the decentralised nature of bitcoin against CBDCs, which can be centralised and potentially surveillant.
Furthermore, these responses also took aim at the ECB’s claim that bitcoin is not a productive asset by pointing to its contribution to the development of blockchain technology, cryptographic security and energy efficiency as examples. The pushback collectively argues that the ECB and similar organisations are misrepresenting bitcoin’s value and potential in developing countries as a catalyst for financial inclusion and technological innovation – in circumstances where the conventional banking system has failed. This is yet another indication of the fierce debate over bitcoin’s role in the global financial system, highlighting the tension between centralisation versus decentralisation.
Source: Forbes
