More From Blockchain’s Cold War
Why Decentralized Finance is Just Communist Thuggery
(And why you can’t bribe capitalist assholes like me.)
This week, Uniswap, an exchange proxy for Ethereum, issued a bunch of tokens it repurchased for around $400 in value per individual it distributed the tokens to. CoinDesk, a cheerleader for anyone who pays for the news it prints owned by the Digital Currency Group, broke the news with typical PR aplomb:
“I think that Uniswap is one of the premier DeFi [decentralized finance] protocols, and its token is as well,” Sam Bankman-Fried, CEO at Alameda Research, told CoinDesk via email. “It has been the largest decentralized trading venue for a long time.”
The praise is noteworthy as Bankman-Fried is credited with saving SushiSwap, Uniswap’s chief competitor.
Last night, the top automated decentralized exchange, Uniswap, dropped a share of its new governance token to everyone that had ever used it, even those whose transactions had failed.
“In a time when people are being greedy and malicious, they did something generous and benevolent, and the fact that it was unexpected was really special,” Meltem Demirors, strategy officer at CoinShares, told CoinDesk via text message.
Three years ago I created a blockchain project in which a proposed decentralized hedge fund would receive funds from digital currency investors, harnessing the power of crowdfunding, and would seek to make outsize investment returns by leveraging new economic functions. Specifically, part of the cash invested would be streamlined into an automated market-making technology, and the other part would be open to the project leaders to play around with. To get the project going, I identified a couple of pretty sound partners in venture capital and blockchain and issued a token on Waves DEX. I distributed most of this token for free to anyone asking for it initially, and then established a trading market for it that was robust enough to take the token’s market capitalization to around $60 million or so.
What happened next you can find online in a series of he said, she said type of US legal transcripts, culminating in me (correctly, as it turned out) calling out the British government for overreach of its power into the US civil court system. Here is the e-mail I sent to the UK government at the time, which sums up the basic tone of this post too:
from:Daniel Mark Harrison <firstname.lastname@example.org>
date:Jan 18, 2019, 10:22 PM
subject:Re: Request for clarification
Attached is the filing in the US courts I submitted today..
I am just so sick and tired of this, Sean. you guys wrecked a multi-million dollar business. My patience has run dry. All I did was try to buy the damn company — that is it. It did not warrant the nefarious media meddling you lot have all engaged in.
It’s out of my hands now. I am getting fully-equipped with some serious lawyers, legal PR force and we are going to get to the bottom of this.
Someone is going to pay for the damage done — simple as that. I am not saying it is you necessarily, but someone is paying one way or the other. This is not bloody Russia, it’s the UK! Government agencies and legal thugs don’t go blanketing media and bumping off innocent people because they don’t like them or have some theory they are guilty of something.
This post is not about that scenario. Sufficient material has been written about it already for there to be justified yet another account of the details of the case (here, here, here, here and here). No, this post is about something far more serious than some silly civil lawsuit in Florida — it is about the installation of communism in the virtual world.
At the time of the events described above, I made the allegation very publicly that Blockchain was some sort of recreation of communism in virtual form. I made this allegation on the basis of a number of observations. Its largest proponents were mostly anonymous, like is the case with the bulk of communist implementations (surreptitious is the more conventional term here); its economics are structured in pyramid fashion, top-down, mafiosa in the way they are enforced (as is the case with the management of most blockchain investment communities today) and it lacks any sense of real innovation in such a way that is so apparently and overtly communist as to be painful.
In the interim three years, in spite of the money, and not in the cause of it, I developed the automated side of the market making system that the decentralized hedge fund would run on. It’s a pretty good software, and if used right, would have some interesting run-on effects. Despite not being a political advocate of decentralization, I did this in all honesty because I said I would do it, and for no other reason whatsoever.
See, being from a first world capitalist society, I believe when you say you will do something, you have an obligation, most of all to yourself, to fulfil that or explain why you can’t do it with a level scientific justification that makes the explanation reasonable. There is no other reasonable option you have at your disposal. Clearly, I was brought up to think this way because this is how people from first world capitalist societies think. In the republican 80s, people believed in hard work, painful sacrifice and keeping your word.
Unsurprisingly, just as I had expected would be the case, the bulk of this innovation that I worked on was stolen by a bunch of pseudo-socialist thugs at Chinese and likely Soviet-funded venture capital funds (you can find out here about how). The end result is the creation of what you will read about in the news as decentralized finance, or DeFi for short.
Since the start, I have maintained that in essence, decentralization as it is practiced today is nothing short of Cold War-style neo-communist fascism. The characteristics are identical, after all. In place of a belief in the human spirit, it seeks to automate everything so that tasks become ‘trustless’. Naturally, it is only in a tyrannical state that one would ever require such trustless solutions, so decentralization is almost entirely irrelevant for first world societies as it is applied nowadays, but no mind that. The ringleaders with the money wanted to enforce it so that they could prevent ordinary people becoming rich, because that is the only way they understand wealth creation — as one individual stealing from another.
At the heart of this Blockchain melee are two organizations — these are the Ethereum Foundation and Binance. One of them is a Swiss tax-free foundation with untransparent processes and a Russian figurehead, and another is a Malta-based (tax-free again) offshore exchange predominantly working out of the Communist People’s Republic of China. Anyone who reading that thinks these are even remotely capitalist-style organizations in all honesty needs their head checking.
The way that these institutions have sought to co-opt finance, a liberating innovation that has brought many millions of dollars into the world in new opportunities and income, and to subvert it into the twisted mafia-style realpolitik that is virtual communism, is as clear as day.
Most DeFI projects on the blockchain for a start are run by teams of anonymous individuals. This should always be a red flag, but no matter for the communist leaders of blockchain innovation. Second, they have stupid names, many of which are associated with food. This is a classic communist thug technique: communism, by its true nature, seeks to appeal to the lowest common denominator of society. It appeals to the mindless, needy man, and seeks to subjugate the strong-willed. Third, it changes its own rules as it goes along. CoinMarketCap.com, now owned by Binance, traditionally requires two trading pairs of a digital asset on major exchanges in order to feature anything. Recently, however, it has lowered those standards to include the trading pairs of those digital assets with only one listing in place. Once again, this is another feature of communist totalitarianism — corruption. Finally, and most evidentially, most of these projects being listed now under the DeFi banner are nothing other than outright frauds. In fact, judging by first-day trading volumes (many of which are in the millions) they are nothing more than conduits for money laundering.
In communist societies, money laundering is commonplace, since money is scarce. To the casual informed observer, it is very obvious why money would be scarce in a communist tyranny — because no one is making it, since the leaders continually subjugate and subvert excellence. This decreases net wealth per capita tremendously.
Back to Uniswap, however. Uniswap is a decentralized exchange that functions as a proxy for the Ethereum Foundation’s own higher-ups to rip-off its own community of users.
This week Uniswap issued a new asset which in essence, gave all its users around $1000 of instant income. To say this is classic communism is an understatement. Communist societies are founded on the very principle of scamming their own people, subverting excellence, and then bribing them with free gifts. That is textbook Marxism, in fact. Another reason for the hand-out was to to subvert those pesky regulations that exchanges normally have to comply with. Even CoinDesk couldn’t ignore this fact, either:
The innovation in its distribution is in the fact that it went to real users rather than only to speculators, according to William Mougayar, a leading token investor.
“This makes it very difficult for regulators to touch them (as Uniswap was very sensitive about that),” he told CoinDesk in an email. “So now we have gradual and proven decentralization first, followed by a sudden token, which is a perfect playbook that legitimizes the token model, while it maneuvers around potential SEC scrutiny.”
As it happens, I have been aware of Uniswap for some time. As such, I too have a number of blockchain wallets in which this hand-out is sitting.
This is a protest post. If you think I am about to take a bribe from a bunch of anonymous people who enforce intellectual property theft, who stand for values which are those that I have sworn against my entire life and swear harder against now, all in the same of materialistic subjugation to an intellectually inferior leadership, then you don’t know me. I am going to leave this hand-out in the wallets they are sitting in now for the simple reason that I won’t accept stolen funds, established on a foundation of criminal values just because you offer it to me.
I am not one of those minds so easily afflicted by mindless greed as this developer, who told by an investor to “be greedy in private … [because] in public you must look like a saint” concurs that such a strategy is a “good idea.”
I am not a saint, just a human being. As a human being, I will be continue to be a human being that is in the way of this recent global movement towards totalitarian policy. I will continue to call out corrupt practice where I see it in black and white, for this is not confined purely to Blockchain, either. In fact, in keeping with the beginning of this post, its greater effects have been felt no more acutely than in the policy adopted by the UK’s conservative government with respect to measures taken to stem the seemingly completely invisible Coronavirus. (If this is what saints look like, I can’t think how the devil himself looks.) Of course, you can tell none of these people have read a word of history, can’t you? If they had, they would know by now that their fate in trying to affect global political minds is a lost one.
That is because among us capitalists, there are always those assholes like myself for no amount of money in the world will budge an inch.