The most common question I hear people ask when they first learn of the meteoric growth of the cryptocurrency market is…
Won’t the government shut it down?
After decades of the government growing into almost every area of our lives and virtually taking over banking, air travel, road travel, sex lives, marriage, food and farming, and even lemonade stands… it’s a valid question!
The answer is no, the government won’t shut down cryptocurrencies—for 4 reasons:
#1 – They technically can’t—There is no central point of attack or control
A government is a centralized organization. The big innovation with blockchain technology—the innovation behind cryptocurrencies—is that it is decentralized and distributed.
The government’s ability to control people and things depends on its ability to access the people and things in a location.
The problem with shutting down Bitcoin is it isn’t in a location. There’s no office to raid, no doors to kick down, no computer to blow up, or any point of attack.
It is running on a new invention called a “distributed ledger” kept on a resilient network made up of thousands of computers all around the world. Any, or many, of those computers could be taken offline and the distributed system still runs.
It’s a new innovation… a virtually “unhackable” computer program that can’t be shut down.
Hackers, both in and out of government, have been trying to hack it since it started in 2009. They have failed.
Other ancillary, related components, such as exchange businesses, have failed and/or been compromised… but not Bitcoin itself.
#2 – The big players have already joined the game
IBM, Goldman Sachs, Deloitte, JP Morgan, Bank of America, Microsoft and many national governments are already investing in blockchain technology.
The smartest big money understands that stopping cryptocurrency is just as feasible as making everyone turn in their cars and go back to using a horse and buggy.
“If you can’t beat ’em, join ’em.” They’ve joined, and every week news breaks about another major corporation, group, or government joining in. Can you blame them? When big innovation happens, big players either adapt or die. This growing list of big organizations joining in is made of up those that understand what’s at stake and want to survive.
#3 – There is massive value in cryptocurrencies
This technology is already out in the open. Mostly in “open source” code, meaning anyone can view it. Thousands of computer programmers and software developers have looked at it, and its openness is part of its innovation.
Cryptocurrency, as the name suggests, is secured by cryptography. That’s basically a cutting edge form of computer security. All Bitcoin transactions are on public record that anyone can view.
But even though that record is public, the Bitcoin funds cannot be easily stopped, stolen, rerouted, frozen, or otherwise messed with.
These new technologies hold the power to disrupt an almost endless list of industries:
- Social Networks
- And many, many more…
And by disrupt, I mean that blockchain technology will offer competing solutions that will be faster, more reliable, and more secure than prevailing solutions. Oh, and they’ll do it for free, or nearly free.
For example, instead of a bank wire taking 1-2 days and costing $25… sending money with Bitcoin costs less than $2 and clears in under 30 minutes.
And you can open a “bank account” (it’s called a wallet in the crypto world) for free in seconds without being treated as a terrorist suspect who is guilty until proven innocent.
That’s what Bitcoin has already done to compete with a wire.
There are over 800 other cryptocurrencies designed to offer alternative solutions to many status quo products and services.
Innovation does 2 things:
- It makes something cheaper
- It makes something possible that was not possible before
Both are a source of wealth creation, and it’s already happening.
#4 – Outlawing something just sends it to other countries
Sometimes we forget that laws don’t get rid of things, they just shift where they go.
If the U.S. government outlawed cryptocurrencies, some of the biggest corporations would be forced to shift their blockchain projects to other countries, such as Russia, China, or Japan, that have been more officially welcoming of the technology. And the massive wealth creation would follow.
The choice to try to outlaw cryptocurrencies would be a choice to send all the wealth creation to other countries.
The Bottom Line
This new technology is technically unstoppable. Some of the biggest corporations are already heavily invested in it. Individuals are making fortunes left and right.
Stated differently, the blockchain technology itself is more powerful than all the worlds’ governments combined. Prepare to see a larger shift than the Industrial Revolution. It’s already happening, and “the toothpaste won’t go back in the tube.”