Posted 1 year ago | by Ben Armstrong
Nassim Taleb: Bitcoin is “Winning”
Noted economist Nassim Taleb recently commented on Bitcoin, and why he thinks it is a good alternative asset to fiat currency.
The world's financial system looks strained, and in Lebanon, people are struggling to get access to their bank deposits. Taleb was born in Lebanon, and knows the problems that the established financial system is facing on a first-hand basis.
“I am realizing Lebanon is in a situation where there is an implied currency control but the government cannot control bitcoin which is a good thing because people have no trust and the ability of the central bank which really causes the ponzi style collapse and the bitcoin does not have that,” at the India Economic Conclave earlier this week.
It is interesting to see someone who is widely recognized as an authority in economics saying that Bitcoin is the opposite of a ponzi scheme, which is a complex fraud to steal money. In the case of fiat currency, the fraud is even more complex, and involves the governments in most nations.
Working for Nothing
The banking system is set up to make the masses think that money is scarce, but that simply isn't true. In Lebanon people are trying to get access to currency (physical cash), but there simply isn't enough to cover the amount of bank deposits that exist in the nation.
Taleb addressed this directly:
“I am very glad that we have cryptocurrencies...Of course, you are going to have frauds and ponzi schemes and all that with bitcoin and cryptos but when you see governments like in Lebanon, doing the ponzis you tell yourself what is better.”
When there is a fraud in the crypto market, the major tokens are used within a secondary fraud scheme. Basically, a bad actor uses the interest that people have in tokens to defraud them. In the case of fiat currencies, the system itself is a fraud that is designed to make people believe they have something of value, when in fact, they have a promise from a central bank that means nothing.
What is Money Again?
Fiat currency, what we use today as money, is nothing more than a complex accounting scheme that is designed to represent the debt of the nation that issues it. Money is debt, that has to be paid back with more debt.
If this sounds like a black hole to you, it gets even more interesting.
As the policy reaction by central banks to the crisis of 2008 demonstrated, the system is set up to take care of the richest people on the planet, while destroying the poorest by cutting off credit and liquidity to any part of the economy that can be financialized (follow this link for more info).
A system, any system, works because people choose to use it on a societal scale. The fiat currency system is no different, and now we have alternatives like Bitcoin and Ethereum. If you don't have any wealth in the currency financial system, you have nothing to lose by switching to cryptos...