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  • Writer's pictureGerard Kavanagh

Financial Privacy

In a recent  excellent, far-ranging interview with MoneyWeeks Merryn Somerset Webb the Co-Founder of Hedge Fund boutique Calderwood Capital, Dylan Grice made some very interesting comments with regard to the cryptoverse but in particular to BTC.

Here is the out-take of interest:

"We also own bitcoin, we also own coins and our view, my view, is that actually there are, I think, a couple of things. All this digital to gold hype, it’s kind of true. That’s what it is. It is digital gold. Now, if you don’t like gold, you’re not going to like bitcoin, and if you do like gold, you still might not like bitcoin for all sorts of reasons.

But it does have a couple of things which are potentially valuable that gold doesn’t have. For example, if you’ve got family at the other side of the world and want to send them some gold, it’s actually quite difficult, whereas sending them some bitcoin is very, very easy.

So, bitcoin is no respecter of distance and I think that that can be something that is potentially interesting. The other thing is that I think that bitcoin, and I think that this is something that people maybe don’t fully understand or haven’t given enough thought to

or just dismiss it as just being a little bit kooky, and that is the notion of financial privacy.

We’ve seen the weaponisation of money already, very obviously with the whole Ukrainian and Russian thing and many people listening might have absolutely agreed with what we did with the Russian reserves.

It’s not about whether or not you agree or disagree. I think, from my perspective at least, it’s really just an observation that money is now a part of the arsenal of the state and I think anyone who works in finance and has to continuously update their details to multiple counterparts who are being bullied by their KYC departments.

I think in our industry, certainly, you can feel in a very real sense this surveillance apparatus that you’re frankly a part of. I just did my money laundering test yesterday because I've got to do it every month and it says, basically, if there is anything slightly out of the ordinary, you have to report it as suspicious to your money laundering reporting officer or to a designated person and you’re not allowed to tell the client.

We’re setting up a kind of informer network. That’s what’s coming. Then, you say, well, we’ve got to stop money laundering, we’ve got to stop financial crime, we’ve got to stop terrorism and drug dealing. Okay, fine, that’s absolutely fine.

But look over in Hong Kong and you see the Press Freedom Association got its bank account frozen by HSBC because Beijing told them to, and you see Navalny’s bank accounts were shut by Putin. So, it’s actually kind of funny that Putin’s bank accounts then get shut by the West, but now we’re doing it.

Then, you see the Canadian truckers, Canadian truckers who were protesting. Whether you agree with them or whether you don’t agree with them doesn’t matter. Those guys got rounded up virtually and they got their bank accounts frozen.

I think this financial surveillance net is absolutely worldwide, is absolutely real. It’s not just something the Chinese and the Russians and those guys use. It’s something that we use ourselves now.

And my view is, on a ten-year view, do you think we’re going to be doing more or less of this? My guess is more. So, a long-winded answer to your question but I think financial privacy is something that you don’t really get with gold. It’s not that you get with anything other than cash and I have a suspicion that it’s not something which is widely valued.

And my fear is that we will start to see events unfold in the coming ten years that people will realise that actually it does have a huge value. So, I think that’s something you get with bitcoin that you don’t get with gold."

As Merryn Somerset Webb acknowledged during and after the interview, Dylan's point regarding financial privacy was not only new but insightful - lending a new angle to why crypto matters.

We would, because of course we would, point out that FIX00 NFTs are clear stores of value AND like Bitcoin offer portability and financial privacy.

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