Bitcoin surges to $10,000 amid debate over cashless society

Bitcoin: From $460 to $10,000 as Cash Retreats

On April 26, 2016, one bitcoin was priced at $460. Sixteen months later, on August 17, 2017, it hit $4,330, with a historical high of $4,480. Shortly after, it crossed the $5,000 barrier and surpassed $10,000. The thesis accompanying these figures is not new, nor does it remain so: physical money is disappearing, and with it, the last loophole through which an ordinary citizen can operate outside the system. In 2016, during the The Transformation of Finance panel at the World Economic Forum in Davos, the question was raised whether physical money would vanish within ten years. Minute 30:14. The original clip challenges viewers to guess who raises their hand.

The End of Cash and Total Control of Money

The scenario being drawn is far from abstract. If cash is withdrawn and only closed-source, centralized electronic money remains, the trail of every transaction stays in a record not controlled by the payer. This is the exact opposite of what Bitcoin proposes, and aligns with the aspiration of any apparatus wanting to know where every euro is: total traceability, blocking with a click, and the ability to empty an account without touching a banknote.

There is a nuance often forgotten in the official narrative. The architects of that system do not renounce their own exceptions. Offshore accounts will continue to exist for those with the position to pay for them, in some country offering the gap. The asymmetry is the crux of the matter: control for the majority, flexibility for the elite.

As a precedent for what may come when alternative routes are closed, the Greek episode reported by Zero Hedge circulates: the confiscation of the largest gold hoard smuggled into the country. The lesson extracted is simple. Before banning money, forms of storing it are banned.

Why Do Japan and Germany Recognize Bitcoin as Payment?

Because several regulators have decided to treat it as a legal means of payment rather than pursue it. Japan approved regulations recognizing it as a valid form of payment, and Germany also acknowledges it, contrasting with the image of a clandestine asset pursued equally by all governments.

The argument that one needs to be a specialist to use it does not hold either. The same person handling a banknote does not know what the monetary multiplier is, and whoever browses the web does not know what DNS or TCP/IP is. No one needs to understand the protocol to use the service. In March 2016, the first purchase on Steam paid with bitcoin was completed.

Can Bitcoin Be Blocked by Shutting Down the Internet?

The short answer is that the cure would cost more than the disease. A country without internet is unviable, and its economy would suffer much more trying to stop the network than it would gain. Moreover, the architecture itself is designed to survive such attacks: self-discovery protocols for nodes exist that, once locating one, receive the list of others, and so on.

And there are shelters older than the cryptocurrency itself. Usenet remains a distributed system from which it is almost impossible to delete anything, and an updated list of nodes could be published there every hour. The comparison with eMule is pertinent: fifteen years running uninterrupted despite the entire legal apparatus against it. The Chinese case closes the circle, because even with the world's most aggressive firewall, active nodes still exist.

The Underground Economy Does Not Disappear: It Survives in Another Currency

Sweden and Denmark have been reducing cash usage for years, and activity outside the official circuit has not vanished. It has simply moved: euros, dollars among Asian merchants, and even Polish zloty. As long as the monopoly is not one hundred percent, people find substitutes.

Others go back further in time. After the war, tangible goods had value, and from this comes a strategy that remains current: accumulating non-perishable items. Shoes, whiskey, tools, decommissioned vehicles. Barter always remains. Money is a medium of exchange, not a good in itself; if that function is removed, it is bypassed and the issue resolved.

From $460 to the $10,000 Barrier

Price evolution is the other thread of this discussion. $460 on April 26, 2016. $904 on December 23 of that year. $1,025 on January 2, 2017. $1,231 on March 1. $1,421 on May 1. $4,330 on August 17, with a historical high of $4,480 and the $5,000 barrier broken shortly after.

Those predicting the fall were left behind. When it traded at $1,100, some announced it would drop to $300, and the plunge from $19,000 to $10,000 served to repeat the same diagnosis two years late. Then it returned to $12,000. One participant summarized the criticism thus: massive money inflows and smells like manipulation.

Those who did enter summarize it more prosaically: money multiplied by ten in less than four years. Those who stayed out will keep waiting for the crash that justifies not having entered.

Underlying it all is the question no one has answered: if cash truly goes dark, what will be used to pay when the system says no?