Bitcoin is a very interesting subject because for many years in Congress, I was a champion of legalizing competition in currencies.
We have a terrible monetary system today. We have a government that purposely counterfeits and debases the currencies and I believe that the alternative would be a competition. That means that anything that wants to substitute for the American dollar should be permitted. There should be no prohibitions; there should not be a monopoly and a cartel running our monetary system because it so often benefits the privileged few. We certainly saw this in the bailing out of the financial system where the wealthy bankers got bailed out it in this recent and severe recession. I am a strong believer in competition. Bitcoin is an introduction to that.
Though I don’t personally believe that Bitcoin is true money, it should be perfectly legal and there should be no restrictions on it, there should be no taxes on it. The people who operate Bitcoin would, of course, be prohibited from committing fraud but the people should be able to have competition whether it is a basket of commodities or crypto-currencies – it should be perfectly legal. For this to operate, we need to have freedom from government intervention when it comes to the Internet. I am concerned that the government ultimately wants to curtail the Internet and there have been attempts to do so.
The internet is the salvation for those of us who believe in liberty because it is an alternative way of getting around the system not only in the spreading of our ideas in this instance but in in terms of getting around the monetary system on the whole if they do permit crypto-currencies and other forms of transactions. So, this is something that we should all be concerned about whether we endorse it or not.
What we should all argue for is the use of freedom rather than having a monetary system with regulation domination that is run by a cartel and the special interests – that is the kind of system we have today. We want a system that truly challenges the government in their ability to take care of the very wealthy at the expense of the middle class and the poor.
This question originally appeared on Quora: Why does Ron Paul think Bitcoin does not fit the definition of money?