Put your money where your mouth is

What the financial blacklisting trend means for the crypto community

Crypto-Libertarians have long-predicted that Tech Giants and the Alt-Right would become odd bedfellows. And now they kinda have: both believe in their moral superiority to deem who is worthy of rights to economic ability.

This comes after many months of increased censorship of user profiles on social media giants like Facebook, Twitter, and YouTube — the latter of which is already known to demonetize offensive videos. The newer blacklisting actions of financial tech giants have gained heightened attention following Patreon’s decision to cut off YouTube star “Sargon of Akkad” when a conversation in which he used the N-word was unearthed.

image from cointube.net

Dave Rubin and Jordan Peterson are members of the Intellectual Dark Web — a group of Classical Liberal and Libertarian thought leaders garnishing an ever-growing fanbase among those frustrated with what they call the “regressive Left.” On January 1st, Dave Rubin and Jordan Peterson announced that Sargon of Akkad’s treatment was the final straw in their decision to leave Patreon in favor of their own payment platforms and cryptocurrencies. This decision follows in the wake of others who are also concerned about the increasing speech regulations that the funding platform has taken upon themselves.

But the Patreon “purge” runs deeper than that. Many on the Left have begun to admonish credit card companies for not adequately monitoring spending habits and refusing transactions associated with hate groups. And this admonishment has evidently led credit card companies to compel platforms like Patreon to report and shut down accounts they perceive to associate with hate speech, even off-platform.

“I just can’t believe that any sensible person would think that through and then want to live in a society where your spending habits are being monitored by the company that basically produces your money. I can’t think of anything more totalitarian than that.” -Jordan Peterson

Such financial blacklisting by the likes of PayPal and Patreon just might encourage more Libertarians and, unfortunately, popular Alt-Right figures to adopt digital currencies. Classical Liberals like Rubin and Peterson stated that cryptocurrencies are part of their plan to move away from Patreon, and Bitcoin addresses can already be found on both of their “Donate” pages. Their specific and controversial political preferences aside, their desires to avoid censorship are in keeping with the spirit of the original blockchain gang, which valued freedom and, at least to some degree, privacy.

But the Alt-Right is another matter altogether. Richard Spencer, a popular White supremacist, and the Guardian referred to Bitcoin as the currency of the Alt-Right nearly a year ago. More recently, even Cryptocurrency News ran the headline: “‘Alt-Right Twitter’ Gab Moves to Bitcoin Payments Due to Banking Blacklist.” Compared to the Intellectual Dark Web, the Alt-Right’s retreat to Bitcoin is not motivated out of upholding principles of human rights, but as a last ditch defensive strategy.

While the chasm couldn’t be bigger between the Alt-Right’s extreme discriminatory and supremacist ideology compared to the Intellectual Dark Web’s extreme freedom ideology, it looks like a mere nuance to many Conservatives and Liberals today. So there are at least two massively important considerations that need to be thought through. The first involves the social stigmatization that the retreat of the Alt-Right might bring to digital currencies. The second is how to defend against financial blacklisting among dApps.

The moral fashion police are coming.

While crypto-enthusiasts and developers are likely to understand that digital currencies hold promise for the every (wo)man, and that digital currencies are used by many exemplary people, those who are less familiar are more likely to associate cryptocurrencies with the morally reprehensible actions and views of the Alt-Right. The crypto community needs to prepare for the smear campaigns coming its way.

As a social psychologist, I suggest going on the offensive and getting some good publicity out there beforehand. People’s political preferences are rooted in deeply-held moral foundations — which is part of why they act with the force of full-blown convictions when it comes to their political opinions. Digital currencies were largely birthed from concerns about freedom and privacy, hence the “crypto-Libertarian” stereotype. The underlying moral foundation for libertarians is freedom.

The problem is, while we could busy ourselves by explaining that cryptocurrency is about freedom, it’s going to fall on deaf ears. Today’s Liberals just don’t value freedom the same ways the crypto community does. Instead, their moral love language is fairness and care. We need materials that explain how cryptocurrencies promote the equality of women, immigrants, and others, in global banking. We also need show the harm it protects people from — let’s write and publish the true stories of those who lost their life savings to irresponsible sub-prime loan-making practices when the bubble burst a decade ago — and how that wouldn’t be possible in a world operated on Bitcoin. How else do cryptocurrencies promote safety and fairness among the innocent and marginalized? Now go write that and publish it in Liberal outlets.

And as for conservatives — they dabble. Their political love language includes concern for fairness and care, but they also set their eyes on purity, loyalty, and tradition. So, let’s also tell them about how our current financial system has become contaminated by people peering into our intimate and private spending lives. Let’s talk about how cryptocurrencies take us back to the founding father’s original vision of economic lives unfettered from a seemingly tyrannical rule. Take these topics to the conservatives that will listen.

More freedom-concerned users are coming too.

Crypto enthusiasts need to consider how they might prevent financial blacklisting among dApps. Certainly transactional privacy would help, and this is something that Bitcoin and Ethereum are infamously bad at. While a user’s identity-address is technically anonymous, the flow of Bitcoin through a network is not. Researchers have shown that by relying on certain idioms of use, natural interactions with known identities allows one to backtrack and figure out the identities of about 15% of supposedly unknown others. But, I don’t really need to tell cryptos that metadata is powerful and can identify us. While Zcash can provide some technical answers, it doesn’t address the larger social and accessibility problems that undermine financial privacy.

Most cryptocurrency wallets are not exempt from the problem of financial blacklisting. Cloud wallets are required by law to keep track of their users’ real-world identities (see BitPay’s ToS), which should spark the same concern that companies and governments could refuse service on the basis of an individual’s political reputation. Multisig wallets in which the user privately holds the majority of keys should be encouraged among those who really want to use a wallet service (this should be the case anyway). Assuming you’re an approved user of a wallet service, this would at least undermine a company’s algorithmic blocking or seizing of funds — as BitPay notes is possible in their prepaid card’s ToS linked to above.

Better Solutions.

Internet Archive founder, Brewster Kale

Those suggestions are just temporary buffers to a larger techno-culture war. What is really needed is a deep decentralization of the web, one that, in Brewster Kale’s repeated words, will “lock the web open” for everyone to participate.

The missing link to this goal is a decentralized identity system. We need the ability for our identity and reputation to be trusted by those we actually know and interact with, not some impersonal Big Brother or some middleman money platform. I find it fascinating and exciting that Satoshi’s earliest collaborator, and staunch voluntarist, had the foresight years ago to build such a system.

In this world, there will be no money that credit card companies or Patreon or PayPal can block. Instead, there will only be direct commerce between people, peer-to-peer, without third-party oligarchs or even a blockchain to sit in the middle.

Fascist take away people’s ability to dissent by removing their economic power. Ironically, tech giants and payment processors are now trying to do exactly that to supposedly stop the Alt-Right. Let’s not let the Fascists, both those running towards crypto and those banning crypto, ruin the world for the rest of us.

I am building out the egalitarian infrastructure of the decentralized web with ERA. If you enjoyed this article, it would mean a lot if you gave it a clap, shared it, and connected with me on Twitter! You can also subscribe to my YouTube channel!