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What is anarcho-capitalism?

What is anarcho-capitalism?

Through blockchain’s ability to create a decentralized record of data and transactions, it has the potential to change society for the better. More transparency, more trust and less reliance on centralized services can lead to more freedom, fairness and equality for tomorrow’s society.

Increasing decentralization using blockchain-based applications opens the door for alternative political philosophies, such as anarcho-capitalism, to potentially function in the real world. In this article, you will learn about anarcho-capitalism and how blockchain can potentially create a thriving anarcho-capitalist society.

What is anarcho-capitalism?

Anarchocapitalism is a political philosophy and political-economic theory that advocates the voluntary exchange of goods and services in a society that is largely regulated by the market rather than the government. It is a fringe political philosophy that promotes the elimination of centralized government in favor of individual ownership, private ownership, and free markets. 

Anarcho-capitalism has its roots in classical liberalism, individualist anarchism (that is, anarchism that prioritizes individual freedom over the free association of individuals), and the 19th-century Austrian school of economics, whose 20th-century proponents included the influential libertarian economist von Wiegh. has it. Mises and F. E. Hayek. Anarcho-capitalism challenges other forms of anarchism by supporting private property and private institutions with significant economic power.

Anarcho-capitalists believe that in the absence of law, society tends to self-regulate through the discipline of the free market. They also believe that instead of paying for courts and law enforcement agencies centrally through taxes, private companies—elected by the consumer—can fill these roles by competing in the free market. Anarcho-capitalists envision a society in which the voluntary trade of private goods and services minimizes conflict while maximizing personal freedom and well-being.

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The term anarcho-capitalism was coined by Murray Rothbard, one of the prominent figures of the American libertarian movement, historian and economist from the 1950s until his death in 1995, who integrated the concepts of the Austrian school of economics, classical liberalism and American anarchism. Rothbard envisioned a “contractual society” in which all goods and services, including those that commonly exist, are produced and exchanged. Transfer to the government is done through voluntary agreements (contracts) between individuals. Such contracts are limited only by a legal act previously approved and agreed upon by the parties. For Rothbard, ordinary state powers are unjustified because their exercise unnecessarily restricts individual freedom, reduces individual well-being, and creates or exacerbates a host of economic and social problems.

Murray believed that “capitalism is the most complete expression of anarchism, and anarchism is the most complete expression of capitalism.” Not only are they compatible, but you really can’t have one without the other. True anarchism will be capitalism and true capitalism will be anarchism.

Can blockchain create an anarcho-capitalist society?

Anarcho-capitalism is a political philosophy, and like many other political philosophies, it has its challenges. Creating a functioning anarcho-capitalist society will require more than a handful of idealists who believe that this anarchist school of thought can create a utopian society.

For anarcho-capitalism to work in the real world, trust is needed. This trust can be provided – to a certain extent – ​​by blockchain-based decentralized services, which can replace many of today’s centrally managed public services.

First of all, all contractual agreements can be digitized and turned into smart contracts. This will reduce friction between different parties in both commercial and civil contexts as smart contracts will be immutable and self-executing.

Digital identities can be created and stored on a blockchain that includes all relevant personal information, so that there is no reliance on centralized bureaucratic document issuing services.

Financial services, such as loans and insurance, can be done using decentralized blockchain-based banking applications, while cryptocurrencies can be used for day-to-day financial transactions.

Additionally, property and asset ownership, as well as ownership transfers, can be recorded in a publicly visible ledger. This ensures that no one can be unfairly deprived of them.

Additionally, a true sharing economy could be created in a decentralized manner where popular peer-to-peer services, such as ride-sharing and home-sharing, can be implemented without a centralized third party cut out of financial transactions. . This in turn makes the economy more efficient and creates more wealth for citizens.

As the examples above show, blockchain has the potential to bring the dream of anarcho-capitalism one step closer to reality for proponents of this political philosophy. Through the decentralization that blockchain technology can bring, there is less and less need for central government public services.

In support of their views, anarcho-capitalists have cited examples of societies closely related to their theory. American economists David Friedman and Bruce Benson, for example, have argued that the Commonwealth period of Icelandic history, which lasted from 930 to 1262 AD, saw social and economic progress despite the lack of a bureaucracy, an executive apparatus, or any criminal system. It was significant. Icelandic society was led by chieftains, or guar, but the presidency was considered private property that could be bought and sold, and membership in a chiefdom was entirely voluntary. Similarly, Rothbard cited early Celtic Ireland as another example of a society exhibiting several features of anarcho-capitalism. 

Ancient Ireland was organized around the so-called Tuatha or political units (small kingdoms or clans) of people voluntarily united for beneficial purposes. According to Rothbard, each Tuatha elected a king whose duties were limited to “negotiating war or peace as a representative of the assemblies.”

Anarcho-capitalism has been challenged by social anarchists because it enables some individuals to use market forces to gain economic and political power. In this context, the American linguist, philosopher and social anarchist Noam Chomsky stated that anarcho-capitalism “leads to forms of tyranny and oppression that have few parallels in human history” and added that “the idea of ​​’free contract’ between the powerful and the hungry subject He is a sick joke.” Friedman, for his part, noted that the Commonwealth of Iceland was able to prevent the wealthy from physically abusing the poor by requiring perpetrators of violence to pay financial restitution to their victims. Another objection has been raised by some libertarians who claim that excessive reliance on market forces can create differences in standards and the application of law and justice. In response to this criticism, Friedman argued that the government is assumed to be controlled by a majority with similar legal ideals. Therefore, in his view, more diverse legal standards and procedures would be more appropriate.

The relationship between Bitcoin and anarcho-capitalism 

Bitcoin is an attractive monetary instrument that many believe will help fight against the central banking system, corrupt economic planning, and help prevent a small group of people from controlling the world’s money supply. Bitcoin is often associated with anarcho-capitalism, free markets, and sometimes the Austrian school of economics. 

final word 

However, the probability of an existing sovereign state changing to an anarcho-capitalist model – despite technically being a possibility thanks to blockchain – is close to zero. Anarcho-capitalism—like most radical political ideas—has a long list of detractors, and in the end, those in power won’t abandon it in favor of an untested political theory that demystifies them and empowers the people

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