!(https://hackernoon.com/hn-images/1*90Q7Hy0h0mhP7a6eLdcTQg.png)\n\nWho decides how much you should pay for food, for gas, or for your medicine? In the current world there are various factors that add up to the price of the product: tariffs, inflation rates, interest rates, and more. The government basically decides how much your car will cost by taking [VAT](https://en.wikipedia.org/wiki/Value-added_tax) from each vendor and manufacturer along the supply chain, from 1 to 27 percent, depending on [country](https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates). They also impose tariffs if this car was imported from another country. Currently, the USA imposes low [tariffs](https://money.cnn.com/2018/05/24/news/car-auto-tariffs-us-germany-japan-toyota-volkswagen/index.html) on EU cars, only 2.5%, but may increase it soon to 25%. Russia will [soon](https://www.wardsauto.com/industry/russia-raising-tariffs-vehicle-imports-us) increase tariffs on American cars up to 40% to motivate its local consumers to buy local vehicles.\n\nIs this bad for you?\n\n* The more barriers that are built, the more [closed](http://thehill.com/opinion/international/384579-tariffs-are-bad-policy) off the country becomes.\n* Every tariff and tax increases price inequality.\n* At the same time, globalization makes these barriers obsolete, because imposing higher tariffs means that your country will receive less imports than before. We can see it happening with [trade wars](https://www.bbc.com/news/world-43512098), started by Donald Trump, who is [sure](https://mobile.twitter.com/realDonaldTrump/status/969525362580484098) that “trade wars are good and easy to win.”\n* The goal of these wars is to support local manufacturers, but the final consumer will have less choice or will have to pay more as the foreign products will become more expensive.\n\nWhen asked if consumers face the consequences of the trade war, Matt Gold, a former deputy assistant U.S. Trade Representative [replied](https://www.cnbc.com/2018/07/27/how-trumps-tariffs-are-set-to-drive-food-and-drink-prices-higher.html): “Absolutely, you’re going to see higher prices passed on to consumers…almost immediately.” He continued, “So everything from the person who walks into Walmart is going to pay higher prices as well as the manufacturer buying material imports for their manufacturing processes.”\n\n!(https://hackernoon.com/hn-images/0*F-VQKq5Elg187RW1)\n\nIf you want to buy foreign products, you pay more (10–25% more) depending on [tariffs](http://time.com/money/5316029/trump-tariffs-prodcut-prices/). That’s how [protectionism](https://en.wikipedia.org/wiki/Protectionism) works. If you want to buy a [CBD product](https://hightimes.com/health/cannabidiol-cbd/) and you live in USA, you’ll have to pay the [price](https://www.leafly.com/news/industry/leafly-investigation-cbd-prices-confusing) of between 5 and 60 cents per milligram. Why is that? Because the USA has restrictions on this market which spurs inequality and creates chaos. However, we are moving slowly towards the free global market, and blockchain technology can help us reach this goal.\n\n### Market with no limits\n\nSince the beginning, blockchain and crypto markets were the perfect example of open free markets. A free market’s main feature is freedom from any manipulation or intervention by a government, prices on [free markets](https://en.wikipedia.org/wiki/Free_market) are regulated only by supply and demand.\n\nDavid Cameron, Britain’s ex-Prime Minister, once [said](https://www.telegraph.co.uk/news/politics/david-cameron/9024978/David-Cameron-Open-markets-promote-morality.html): “I believe that open markets and free enterprise are the best imaginable force for improving human wealth and happiness. They are the engine of progress, generating the enterprise and innovation that lifts people out of poverty and gives people opportunity. And I would go further: where they work properly, open markets and free enterprise can actually promote morality.”\n\nBy incentivizing free trade, competition is created. Everyone is treated equally, and only high-quality products can win here. That’s why many countries close their borders with high tariffs — they simply can’t compete with better economies who do it better or cheaper. But blockchain and cryptocurrencies help avoid these restrictions.\n\nBitcoin was the first asset that was freely traded without any boundaries since its release in (https://en.bitcoin.it/wiki/Bitcoin_Firsts). The first 5,000 BTC were sold for $5.\n\nSince then its price has climbed, because as we already know, when there are no restrictions the price of an asset on an open market tends to change until it reaches the equilibrium of supply and demand. The same story goes for various altcoins and tokens of blockchain projects that appeared after BTC. The crypto market capitalization grows with adoption, the more people know about, the more they want to buy it. Some may call it “[fear of missing out](https://en.oxforddictionaries.com/definition/fomo)”, but we’d rather say it’s the current demand.\n\nWhen we say “no boundaries”, it means exactly that. If you want to buy Bitcoin in Italy, then sell a part of it for another altcoin to someone in China, and send a part of it as a gift to a friend in North Korea as well, you can do it. No one can restrict you on a free market. People in China and North Korea will have problems with accessing their Bitcoins, due to governmental regulations, but their money will be there on the blockchain. That’s why it’s so great.\n\nVitalik Buterin [explained](https://medium.com/conversations-with-tyler/vitalik-buterin-tyler-cowen-cryptocurrency-blockchain-tech-3a2b20c12c97) this concept: “All of the actors are anonymous, and what that means in practice is that you cannot drag people’s utility down below zero. If I have 70 ether, and I put that 70 ether into a mechanism, the worst thing you can do to me is you can take away that 70 ether.\n\nYou cannot throw me in jail. You cannot socially ostracize me so I can’t earn any money again because I can always just switch identities.”\n\n!(https://hackernoon.com/hn-images/0*rs3YCTPDMOgUe7A7)\n\nDoes it mean that there won’t be any regulations? Absolutely not! Governments around the world try to come up with ideas on how to deal with it. Some of them just banned all crowdfunding projects and crypto trading, like [China](https://www.forbes.com/sites/kenrapoza/2017/09/28/china-ico-ban-bitcoin-crypto-currency-market-cap-returns/#2753c0c56c21) in September 2017, and the crypto market subsequently lost 50% of its capitalization then. Some try to pass laws regulating it, like the [USA](https://medium.com/polyswarm/how-the-sec-is-impacting-crypto-regulation-an-overview-a68962f5c642) and [Russia](https://cointelegraph.com/news/russia-crypto-miners-and-holders-will-be-regulated-under-existing-laws).\n\nCan laws regulate free markets and crypto markets? Wendy McElroy, a famous anarchist, [wrote](https://news.bitcoin.com/wendy-mcelroy-the-free-market-can-provide-law/) in her article: “Law should not be the entering edge of a situation because it is an organizing principle; this presumes there is something to organize, and it should follow ongoing arrangements. But, then, every once in awhile, a paradigm explodes and disrupts, well, the paradigm. Cryptocurrency exploded. Law has been scrambling to catch up ever since. And law should catch up.”\n\nAlso, when writing on the topic of law-making, she said: “Human society is accustomed to politicians and other thugs who make the discussion of rules devolve into making beneficiaries of some at the expense of others.”\n\nYes, that’s it. The government decides who benefits on the market by making its laws. In ideal conditions it should be decided by free markets, essentially through supply and demand. Instead we see bailouts, like in 2008 with [banks](https://en.m.wikipedia.org/wiki/Emergency_Economic_Stabilization_Act_of_2008), when $700 billion was spent to support them, or in 1979 with [Chrysler](https://www.investopedia.com/articles/economics/chrysler-bailout.asp), when it was given $1.5 billion to save the company. The list goes [on and on](https://projects.propublica.org/bailout/list).\n\n### Opinions, opinions\n\nMany anarchists and libertarians believe in Bitcoin. Let’s see what they think.\n\nRon Paul is a long-time free market supporter and he thinks that Bitcoin may dethrone the dollar some day. That’s what he said about the American economy in (https://schiffgold.com/interviews/ron-paul-what-america-has-today-is-not-free-market-capitalism-video/): “If you say free markets and capitalism together, we don’t have that. We have interventionism. We have a planned economy. We have a welfare state. We have inflationism. We have central economic planning by a central bank. We have a belief in deficit financing. It is so far removed from free-market capitalism that it’s foolish for people to label it free market…”\n\nAnd here’s his [statement](https://money.cnn.com/2013/12/04/technology/bitcoin-libertarian/index.html) about Bitcoin: “There will be alternatives to the dollar, and this might be one of them. If people start using bitcoins en masse, it’ll go down in history as the destroyer of the dollar.”\n\n!(https://hackernoon.com/hn-images/0*kjGdz04Vul4haV4c)\n\nKonrad Graf is an economist who writes on free markets and monetary policy. In his essay “On the Origins of Bitcoin: Stages of Monetary Evolution” he [wrote](https://nakamotoinstitute.org/static/docs/origins-of-bitcoin.pdf): “Bitcoin was offered up as an invention/discovery of a new way to do something very old — transfer the control of purchasing power from one party to another. This method was offered for free to the entire human population. \\[Each\\] person remains entirely free to either ignore it or use it in some way, and only to the exact extent of each person’s willing participation.”\n\nJeffrey Tucker, an editorial director of the American Institute for Economic Research, also supports Bitcoin. He wrote in his [article](https://bitcoinmagazine.com/articles/op-ed-there-future-banking-cryptocurrency-dominated-world/): “There are dramatic challenges to the status quo that are being offered up by the advent of cryptocurrency. The new world will be financially sound, stable, radically disintermediated, decentralized and democratized because anyone, of any financial means and access to financial institutions, can participate within it.”\n\nOf course, there’s a lot of people who don’t support Bitcoin and the opportunities that it provides. Some even call it “the most spectacular private Ponzi scheme in history,” said [Gary North](https://www.lewrockwell.com/2013/11/gary-north/is-bitcoin-a-ponzi-scheme/). But the free market exists as long as there are some willing participants, and with the [daily trading volume](https://coinmarketcap.com/currencies/volume/24-hour/) worth $14 billion the blockchain industry clearly doesn’t see any shortage of new incomers and new ideas.\n\n### Going deeper\n\nLet’s see how implementing blockchain could help us establish a fairer price for products in the real world. In the beginning of this article we talked about CBD. This market is like the [Wild West](https://www.marijuanabreak.com/the-cbd-market-snapshot-growth-analysis-size) due to a lack of suppliers and high customer demand.\n\nYou can already find blockchain solutions that promote the free market approach to CBD. Like [CBDoken](https://cbdoken.com/) — it lets the market decide how much it wants to pay for CBD products by introducing Ethereum-based tokens-vouchers. Each voucher is backed by a product that is stored in the company’s warehouses. How does it help in setting the market price? All tokens are being sold at a price 80% lower than average. All tokens can be redeemed for actual products. Buyer can buy cheaper CBD, and retailers and resellers can buy it to sell somewhere else with profit. Cutting the middleman allows purchasers to save on costs tremendously — to the point that the manufacturer still makes profit, after making a discount of 350%, because it skips a large part of a distribution chain and goes directly to the customer. CBD is a fast-growing industry, by all means, and CBDoken has the chance to disrupt it by having a unique distribution model. That’s how free markets work — you have something to offer, you have a better proposition, you win. Millions of people will be able to buy it directly. If you have to choose between paying $20 and $100 for the same product of the same quality, what would you choose?\n\n!(https://hackernoon.com/hn-images/0*w9wIjSh0FUOxEyBx)\n\nWe can imagine an apartment or a car tokenized in the same way and then sold in the free market. [NEM](https://nem.io/), a well-known blockchain project that aims to tokenize real-world assets is disrupting markets all over. Ethereum, aside from CBDoken, also hosts some projects that offer tokens backed by real assets, like [Digix Gold](https://coinsutra.com/digixdao-digixgold-dgd-dgx/), its token is equal to 1 gram of real gold. And let’s not forget about stablecoins. [Tether](https://tether.to/), a project that issues dollar-backed USDT tokens, and its competitor [TrueUSD](https://www.trusttoken.com/trueusd/), which has $256 trillion of audited funds, or [DAI](https://makerdao.com/), a decentralized collateral-backed stable cryptocurrency also pegged to the dollar. Those are the perfect examples of a free market. You can use any of them, they are the same, it’s the question of trust: some of them may have it from you, some of them don’t. That’s how it should work. You choose what is better. \nA while ago, [Uber](https://www.uber.com/) came to the market of ride-sharing, pushing out traditional taxi drivers. There was a decade of struggle, old business models unable to compete tried to suppress Uber with governmental help. But all in vain. That’s the free market.\n\n### Conclusion\n\nThe main question was, is the free market becoming a reality with the development of blockchain or is it just a libertarian fairytale, very pleasant but not applicable in real life? As we see, governments try to protect themselves and to control everything as much as possible. They want to keep the current status quo and leave things as they are in their current state. But the blockchain technologies, cryptocurrencies, and new economic models disrupt the existing systems by being more effective than the old ones. It may be useless to wait for changes to occur from the side of governments, but we can expect changes coming from the other side, the decentralized side. Every system tries to balance itself, and in such an open global world it’s impossible to resist the changes. Eventually, we will see it happen.\n\n#### About the author:\n\n[Kirill Shilov](http://twitter.com/kirills4ilov) — Founder of Geekforge.io and Howtotoken.com. Interviewing the top 10,000 worldwide experts who reveal the biggest issues on the way to technological singularity. Join my **#10kqachallenge:** [GeekForge Formula](https://formula.geekforge.io/).