The Local Bitcoin Solution
Localism is struggling more than ever
Although the internet era introduced incredible technological advancements, the sobering reality is it battered many small local businesses along the way. Despite well-intentioned ‘shop local’ efforts from community advocates, localism continues to face an uphill battle. Over the past 30 years, new business creation has declined by almost 50%. Even during the longest economic expansion on record, which began in 2009, entrepreneurship failed to reach its pre-recession level. The outlook further deteriorated with COVID when 65%+ of surveyed small businesses reported negative related impacts. The businesses that survived are now grappling with historic levels of price inflation, labor shortages, and fragile supply chains. Small business owners are scrambling by increasing prices at the highest rate since 1974 to try to offset rising inventory costs and in effort to attract and retain employees. They are also forecasting high levels of pessimism as they brace for expected worsening conditions over the next 6 months.
Why localism matters
Localism is the prioritization of local production, consumption, culture, and autonomy. It directly impacts quality of life as it actively supports a community’s ability to thrive. It is less ensnared by immovable national partisan politics and divisive banter on social media. It is focused on working together with neighbors to solve problems in a more impactful and scalable manner. Although staying connected has never been easier with the advent of social media, people are as lonely and isolated as ever. Localism draws people together in a powerful way. The reason paying cash to a local shop owner is far more fulfilling than swiping a credit card to pay a multinational company is because there is a much greater sense of connectedness. Most people understand how localism provides both tangible (economic) and intangible (social) benefits – however local communities are still struggling more than ever as we continue to drift towards a homogenized wasteland of sprawling parking lots, big box stores, and chain restaurants. It is no coincidence that the departure from localism and rise of globalism coincides with the first American generation to be worse off financially than the generation before them.
Understanding the decline of localism
The decline of localism is mostly due to a confluence of failings by central planners stacking the deck against small businesses. This includes short-sighted economic planning, rampant corporatocracy, burdensome ‘one-size-fits-all’ regulatory requirements, and destructive central banking policies that mainly benefits megalithic corporate interests.
Look no further than to the decline of community banking – a critical cornerstone to ensuring a local community’s vibrancy. Deposits are made within local institutions, which are subsequently lent to local businesses, by local bankers who possess meaningful relationships within the community in addition to having specialized knowledge about the area. In the last decade, only 44 new banks have been established compared with 2,000 new banks from 1990 to 2008. Low-interest rate monetary policy coupled with increasing regulatory requirements has destroyed the community bank as large national banks scoop up their remnants through acquisitions. Despite the 2008 financial crisis being mostly driven by national banks (community banks held just .003% of all credit derivatives from 2003-2010 and only 2% of residential mortgage defaults), the community banks were slapped with the same burdensome regulations which greatly increased compliance and overhead costs. Local community banks cannot overcome corrosive monetary policy, corporatocracy in the form of bailouts for larger financial institutions, and an imbalanced regulatory framework.
Put more simply – the money is broken. Throughout its 1,000-year history, government-issued currency has always failed. Although some fiat currencies last longer than others, inevitably the money supply expands to a point where it greatly exceeds the available goods and services, hyperinflation takes hold, and the currency’s value collapses. Although this scenario seemingly exists only with foreign currencies or in a distant dystopian future in America, the reality is that we are already experiencing the effects of unsound money in the present day. We are conditioned to accept the harsh reality that your annual wages must continually outpace inflation every year to prevent a decline in your quality of life. A condition that especially leaves behind low-income earners who lack the access and resources to acquire the inflated financial assets needed to participate in a debt-driven economy.
"One of the biggest taxes is one that is not even called a tax – inflation. When the government spends money that it creates, it is transferring part of the value of your money to themselves.” - Thomas Sowell
The solutions will not arise from national politics or well-intentioned corporate globalism. We need to shift our focus towards the communities we live in and enact change by reigniting localism.
And we’ll need better money to do it.
Why bitcoin is good for localism
Bitcoin enables a direct connection between customers and local businesses. It is unfettered from faceless intermediaries like major banks and credit card processors that charge the merchant processing fees and conducts wide-scale consumer surveillance.
As a digital global currency, bitcoin opens your community up to the world. With a click of a button, you can instantly send a payment to anyone on the planet. No banks, no money transfer companies, no costly foreign exchange or transfer fees, and no lengthy processing times. Bitcoin is as easy to send as an email.
The bitcoin network operates 24/7 with an uptime of 99.98%. It is the most secure and reliable monetary network in history. No costly system outages, card reader errors or stolen customer credit card information to worry about. Fast, instant, secure payments for you and your customers.
Bitcoin amplifies the local economic multiplier effect. As a digital peer-to-peer currency that doesn't require intermediaries for payments, more money is able to percolate through the local economy. Bitcoin communities are positioned for the future digital economy introducing new jobs and industries.
Bitcoin is censorship resistant and insulates a local bitcoin circular economy from authoritarians engaging in national political skirmishes. While the specter of financial censorship may seem unlikely in the United States, we have already witnessed in western countries like Canada that dissenting political opinions can result in citizens becoming exiled from the legacy financial system.
Bitcoin is the most portable money in history. Funds can be transmitted globally with a click of a button and secured on a device no bigger than a thumb drive. No time-wasting wire transfers and relying on financial institutions needed.