The central theses
- A key economic advisor to the Dutch government has published an article calling for a ban on Bitcoin mining, trading and holding.
- The article claims that Bitcoin does not have the key characteristics of traditional currencies such as dollars or euros.
- The arguments presented show a misunderstanding of the most important Bitcoin concepts.
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Pieter Hasekamp, a key economic advisor to the Dutch Ministry of Economic Affairs, has called for a total ban on the mining, trading and ownership of Bitcoin.
Economic advisor forces Bitcoin shutdown
Days after El Salvador passed law to make Bitcoin legal tender, a key official in the Netherlands proposed a total ban on the asset. Pieter Hasekamp, the director of the Netherlands Bureau of Economic Analysis, believes that mining, trading and even holding Bitcoin should be banned immediately.
In an article on the Central Planning Bureau’s website entitled “The Netherlands Must Ban Bitcoin,” Hasekamp argues that Bitcoin does not meet the three key criteria of money. The asset is an unstable unit of account, impractical for payments, and easy to forge or steal compared to traditional currencies, Hasekamp said. He added that bitcoin is preferred by criminals because of its “anonymity”.
The arguments put forward by Hasekamp have been used frequently by Bitcoin’s loudest critics over the years, though crypto-believers argue that such points are misguided. While Bitcoin is unstable, proponents argue that cryptocurrencies are an emerging asset class and therefore have not yet found their true value. In addition, the overall development of Bitcoin was positive.
Additionally, Bitcoin payments have gotten easier in recent years thanks to the development of the Lightning Network. As Layer 2 on Bitcoin, the Lightning Network processes transactions at a higher speed and lower costs than the basic chain. When El Salvador begins rolling out the asset, the plan is for its citizens to use Strike, which runs on the Lightning Network.
Hasekamp’s argument that Bitcoin is easy to counterfeit and steal is also questionable. Bitcoin is extremely secure as it is decentralized while transactions are very easy to track. In the recent Colonial Pipeline ransomware case, the FBI was able to reclaim part of the ransom money paid in BTC by simply following the transactions in the distributed ledger.
While Hasekamp’s sharp comments show a lack of understanding of the modern value proposition of blockchain technology, his views do not reflect the official position of the Dutch government. In other words, cryptocurrency holders are still doing well to hold and trade their digital assets.
Disclaimer: The author was holding ETH and several other cryptocurrencies at the time of writing.
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