Magic Internet Beans

 “Let Them Eat Crypto – The Blockchain Scam That's Ruining the World” by Peter Howson, 2023

This is an astonishing book that relates the most fictitious capital in history – crypto digital 'coins' or tokens – to a wide range of cyber-libertarian economic, social and environmental damage. It is a fitting tribute to 'holistic' investigations that don't treat issues as isolated one-offs. Howson used to be a crypto / blockchain enthusiast on the non-profit 'charity' side of the bugger. He gradually realized how destructive it was. What did Howson discover besides the fact that crypto is not a currency and is not even a real speculative asset for most, just a Ponzi / pyramid scheme?

Howson's contention is that it is a through-going Libertarian con. It is aimed at eliminating bourgeois democratic-style government, financial regulation and taxes. On the other hand it fuels money-laundering and many frauds. Just a list of the enthusiasts tells you something – Bankman-Fried, Musk, Thiel, Altman, Zuckerberg, Brin, Andreessen, Dorsey and Winkelvoss; air-headed A-list celebrities – Matt Damon, Reese Witherspoon, Drake, Jeffrey Epstein, Snoop Dog, Floyd Mayweather, Jay-Z and Kim Kardashian; hard-right politicians like Rishi Sunak, Alex Jones, Andrew Tate, Steve Bannon and the rest. It became the confluence of Silicon Valley, hard-right conservatives, science fiction and Hollywood. That fiction part in important.

Yet the 'establishment' was also tolerant. International charities, Davos and units of the U.N. got on-board with crypto. The SEC advocates a 'lite-touch' towards it. Groups at Oxford University led by Peter Singer and at M.I.T. promoted it. Post-modern philosophies were developed around it called 'longtermism,' 'effective altruism' (EA) and Web3. They changed the meaning of words, substituting the internet for reality, philosophically substituting idealism for materialism. As Marxists, that is significant.

Howson names nearly every failed crypto exchange, shitcoin, blockchain surveillance tool, dark web node, internet game and crypto fraud. He misses the Centra-Tech one which claimed to invent an ATM dispensing real money from your crypto 'wallet.' This is key, as crypto can only buy things from other crypto holders, it cannot transition back into the real world as yet. There are profitable gains for some big capitalists, hard-right reactionaries and many criminals when the rubes and marks use real cash to gamble in crypto, but not for the rest of society. Howson points out that 'decentralization' is a farcical idea, as hidden capitalists or fraudsters are now the real 'centers.' And there is no recourse if you lose your money. Let's go through the points made by Howson.

Bankman-Fried.  Would You Trust Your Money to Him?

Unbanking

Unbanking is the claim by crypto bosses that they will replace real money with digital coins to help the underprivileged across the world – especially those not tied to a bank. It is similar to the exploitative 'microfinance' loans pushed by people like Hillary Clinton. Howson describes the 'pump and dump' scheme in crypto. Introduce a coin, wait for suckers to invest, then take the money at it's high-point 'value.' Even worse than a real bank. Or wait for 'critical mass' of investors to be reached, then 'pull the rug out' and run. 

Crypto has no regulation, so it is a playground for fraud, not 'peer to peer' trust. 'Market values' yo-yo all over the place, as happened in the crashes of 2017 and 2022, due to its not being tied to anything. A majority of coins and NFTs are scams or spam. Sometimes big coin owners 'wash trade' their own coins to pretend there is activity. Yet 'trading' includes a fee for the groundlings. Some people lost millions in crypto due to a keyboard accident or lost password. Christian missionaries pitched these “magic internet beans” to the poverty-stricken unbanked and immiserated, especially to African youth and students. There is no age limit for buying coins or tokens, but studies have shown a link to gambling addictions, depression and suicide. So buy up kids!

Colonialism

Crypto billionaires target 'under-served communities' and subprime poverty spots across the global South. They crusade for weak governments to adopt crypto, like El Salvador, even though local businesses, those without access to the internet and the vast majority of the Salvadorean population wanted no part of it. Isolated islands are favorite targets of 'govt. free' economic zones, like Vanuatu, Palau or Tigray, or if not that, imaginary places on the internet that the crypto bros can gambol in with pretend flags, buildings and laws. But these 'places' are not free of capitalists, tax avoiders, Russian hackers or drug money-launderers.

Green Washing

Crypto is used to greenwash fund carbon credits, offsets and carbon capture – failed strategies to stop global warming. Bitcoin 'mining' involves thousands of dedicated ASIC computer boxes dedicated to discovering the password puzzle that is each hours-long Bitcoin transaction, sucking energy across the world. This process is called Proof of Work. They pick vulnerable places to plant these facilities like the Navajo Nation or Pine Ridge, Transnistria or Abkhazia. In the U.S. they reopen closed nuclear, oil, tire or coal plants or siphon-off megawatts from the Texas grid at a far smaller price than regular consumers pay. Yet they pretend they are saving the world from global climate change. Crypto alone uses as much energy as all world-wide data centers. The CO2 from just the Bitcoin ASIC decryption boxes amounts to that of Greece at 72 million tons per year, while the ewaste per year is another 37K tons. Ethereum crypto does not use the same 'proof' but Bitcoin cannot and will not change their method.

Bad Charity

Crypto promises NGO's and big name charities that donations will be tax free and secret. NFT's, a digital image, or at least a link to one that might disappear one day, are also for sale as fundraisers. According to Howson, instead of solving real problems, crypto-types invent a problem or fake solution, then congratulate themselves over it. Like giving too many mosquito nets for malaria prevention, even though the nets are not used and instead sold to fishermen. Venture capitalism for charity, DAOs, allow givers to get voting rights but no ultimate control over their funds. Crypto also funded various right-wing causes like the Freedom Convoy in Canada that protested mask requirements, both Ukrainian and Russian war efforts and a host of other efforts.

Machismo

Howson explores the ties between the manosphere, misogyny, pick-up artists, polyamory, right-wing politics and crypto. Most crypto investors are white guys from 20-40 in the U.S. And, oh yes, a Dogecoin was a favorite of Elon Musk's until it plummeted in value. Sound familiar? Now we have a department in Trump's government named that while the crypto industry was a heavy backer of Trump, giving more than many other businesses. Vegans, 'soy boys,' no-coiners and low testosterone men were seen as the enemy by the carnivore bros. Women hold on 13% of crypto, which is why there are efforts to 'pink-wash' them. Pornhub decided to be paid in crypto, without any control over the violent or humiliating porn shown, but hey, it's a free market!

The Betaverse

The metaverse is already dead and VR headsets are not the new normal. AI has taken its place with Facebook and the rest of the financial class. Howson details the various versions, including a headset that you could program to kill yourself. Living a fake 'life' online seems not to be the draw they thought it was - even with gamers. And yes, crypto allowed you to buy an avatar's digital hat and shoes! There's also a tie to biometrics, where facial images, blood and other data are stored in blockchains to identify subjects.

Unlike leftists like Loretta Napoleoni or Richard Wolff, Howson opposes using blockchain as some kind of 'socialist' automation of record-keeping. He also thinks it does not liberate poor people or oppressed minorities, as pushed by some black capitalists. He debates various anarcho-communists and left libertarians like Julian Assange on crypto, which kept Wikileaks running for a time. He sees crypto as a last, false resort for the disinherited trying to buy into consumer society. Even in Cuba and Venezuela it has made desperate inroads due to official financial sanctions of those countries. A Spanish Catalan experiment in it as a 'return to the commons' and 'degrowth' ended in speculation and fraud. In a way, it is an 'opium' for most people and a rapacious profit-source for others.

At any rate, Howson has no specific solution except to suggest that all the lies and scams promulgated by the techies are typical of capitalism. So it is up to us to figure out a cure.

Prior blogspot reviews on this subject, use blog search box, upper left, to investigate our 19 year archive, using these terms: “crypto,” “blockchain,” “technology,” “libertarian,” “Techno-Capitalism,” “New Dark Age,” “Scorched Earth,” “Would Trotsky Wear a Bluetooth?” “Fully Automated Luxury Communism” (Bastani); “Cypher-Punks” (Assange); “Kill All Normies,” “Bit Tyrants,” “Inconspicuous Consumption,” “Ponzi Factor,” “Off-Shore,” “Crack-up Capitalism.”

MAnd I bought this modern book at May Day Books!

Red Frog / January 14, 2025