The financial crisis still haunting Greece


Join thousands of others who receive this daily analysis of crypto markets & news in their inbox every morning - subscribe now.


People don’t forget when banks and governments mismanage their money.

I’m in Greece for a few days and have been blown away by how many people are still talking about the Greek financial crisis. As a reminder, Greece suffered the longest recession of any modern capitalistic society starting in 2009. The crisis was started by the Great Recession and exposed structural weaknesses in the Greek economy. To add fuel to the fire, it became publicly known that Greece’s government had previously underreported their sovereign debt and deficit levels.

As the economy spiraled out of control, the government initiated 12 rounds of tax increases and spending cuts. None of this policy prevented the country from having to receive three separate bail out loans from 2010 to 2015, along with a 50% reduction in debt that was owed to private banks. The entire situation could be summed up with a single sentence — Greece was in trouble for a long time and the citizens of the country suffered as a result.

Each person I’ve talked with during this trip has found a way to bring up the financial ineptitude at some point. They blame the crisis for their inability to find high-paying jobs, for their family members moving abroad, for the inflow of immigrants, or for the “bad economy.” It almost doesn’t matter if these people are right or not. This is how they genuinely feel.

These conversations remind me of something Jim Grant said about central banks: “They are the arsonist, but they get to pretend they are the firemen.” In other words, it is likely that the Greek government’s actions, both before and after the Great Recession, actually intensified the financial crisis, rather than improved it. While this is not a new concept, it feels like people around the world are waking up to this prospect.

I wish I could tell you that the same people complaining about the impact of the financial crisis were boasting about the benefits of Bitcoin — they weren’t though. Each person I’ve talked with confirmed that they have heard of Bitcoin but were relatively unaware of (1) what it is and/or (2) what the benefits are. The fact that no one was educated and enthusiastic is actually a bullish sign to me.

As more people get educated, more people will be drawn to Bitcoin. They will ultimately choose to trust software and math over humans. This is not a matter of “if,” but rather “when.” For those of us that are interested in accelerating the adoption of Bitcoin, the task is simple: Do what you can to educate the people around you.

Knowledge is power and people are tired of watching banks and governments mismanage their wealth.

-Pomp


The “Off The Chain” podcast has been downloaded 180,000+ times in 120 countries. You can listen to the latest episode with Marco Santori, President & Chief Legal Officer of Blockchain now: Click here for Off The Chain podcast


THE RUNDOWN:

Canadians to use blockchain for digital IDs: Estonia has long had digital identity cards, Indians use iris scans to authenticate money transfers, and soon Canadians will be able to verify personal information for everything from driver’s licenses to banking using mobile phones and blockchain. Consumers will be able to sign up for new digital-identity system developed by SecureKey Technologies Inc. and underpinned by IBM Corp.’s blockchain technology in the first half of 2018. Read more.

Ethereum’s Joe Lubin: Blockchain will help to create more wealth: Ethereum co-founder and ConsenSys CEO Joe Lubin has said that with blockchain, society will move “from a scarcity to an abundance mindset,” told The New York Times. Lubin spoke about how the advancements heralded by blockchain tech could potentially give control back to society, allowing for more individual “agency.” Read more.

Singapore regulator would consider trialing certain ICOs: Singapore’s financial regulator would consider trialling some initial coin offerings in a regulatory sandbox, if such fundraising efforts are by companies focused on new technology that will improve the efficiency of capital markets. The type of digital-token sale that the Monetary Authority of Singapore would consider is one underpinned by technology that improves capital markets, for example smart contracts or something that can build a “smarter” initial public offering. Read more.

CFTC fines Bitcoin trader $1.1 million for crypto fraud: The U.S. Commodity Futures Trading Commission has jailed a bitcoin trader and fined him over $1 million for running a fraudulent bitcoin and litecoin scheme. The trader admitted to defrauding investors of hundreds of thousands of dollars after misappropriating more than $600,000 of his previous employer's funds. Read more.

IBM says blockchain can power 'open scientific research' in new patent filing: A patent application claims the process of conducting scientific research can benefit from the blockchain. Led by a team at IBM's Watson Research Center, the patent application presents a vision for dynamic collaboration – one where researchers can track their work across institutional borders. It's another non-financial application of the distributed-ledger technology, which IBM has championed in recent months. Read more.


If you enjoy reading “Off The Chain,” click here to tweet to tell others about it.

Nothing in this email is intended to serve as financial advice. Do your own research.

Subscribe now