By Robert Wenzel
I have written some positive things about the blockchain technology and its potential as a recorder of property ownership, including real estate and stock shares, and its capability for other recording activities.
I have had enough dealings with the evil crony-controlled bastards at the DTCC to know that security transfer operations needs to be taken out of their hands. However, it is important to understand that the blockchain is a technological tool that, like most other tools, can be used for either good or evil.
A gun, a technological tool, in the hands of an individual who uses it for self-defense is a great thing. A gun in the hands of a totalitarian government agent is not so good.
Libertarians need to keep in mind that while technologies can be used to advance liberty, that is not always the case, and not everything that a blockchain could provide is necessarily a positive.
For example, the idea that a blockchain could record marriage "licenses" sounds like a horrific idea to me. It's fine if two people want to record the permanency of their decision to form a life-long commitment and record it via a blockchain, just as it would be fine for them to carve news of their commitment in a cliff set aside for such, but I can also think of many reasons why someone might not want to do this. In other words, recording a marriage on a blockchain. should not be confused as somehow a libertarian method of recording marriages. I'm perfectly fine with two people telling blockchain recording advocates and the rest of the world, "None of you damn business what we have decided to do in our personal lives."
Likewise, that fishing licenses or cosmetology licences could be recorded on a blockchain does not justify the idea of fishing licenses or cosmetology licences in the first place. If in a libertarian society all property is privately owned, including waterways, then the idea of fishing licenses pretty much vanishes. Just becasue licenses can be recorded on a blockchain does not make them good or necessary.
It is good that thinking about blockchains is going on in libertarian circles, but new technologies, which may have some positive applications from a libertarian perspective, are not necessarily always liberty advancing. It is extremely dangerous to think that everything that could come out of a blockchain is a positive.
On another point, although the blockchain is now closely tied in with Bitcoin, it is not difficult to understand how a blockchain could develop outside the realm of Bitcoin or other electronic currencies.
The argument that recording of transactions could not be done for free without Bitcoin mining operations, and therefore Bitcoin is required for the development of a blockchain, does not hold from an economics perspective. Who says recording needs to be done for free? If there is a demand for blockchain recording, why wouldn't someone want to pay for such a service? Isn't that how the free market works?
Robert Wenzel is Editor & Publisher at EconomicPolicyJournal.com and at Target Liberty. He is also author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics
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