Recently, one bitcoin was worth almost one crore Nepali Rupees. Despite this, neither civil society nor the tech community has taken steps to engage in a discussion regarding the potential regressive effects on the country's tech future if the bitcoin ban persists.
The prohibition of cryptocurrencies like bitcoin undermines individuals' financial autonomy and restricts their access to diverse investment opportunities, hindering their participation in a decentralized and equitable digital economy. Such measures contradict the principles that fueled the 2006 uprising, which advocated for broader societal empowerment and economic inclusivity. The communist regime's denouncement of bitcoin and other cryptocurrencies as scams, despite their widespread global acceptance, starkly contrasts with communism's minimal presence around the world. Cryptocurrencies like bitcoin embody the promise collectively made by all political parties to the people: access to investment opportunities within reach of economically marginalized sections of society. While it is crucial to understand the government's stance on the crypto ban, the lack of progress towards regulatory efforts has fostered a feeling of hopelessness within both the tech community and among the younger generation.
Recently, bitcoin has surged past the price of 90 Lakh Nepali Rupees. The lowest closing price for bitcoin (BTC) in recent times was 20 Lakhs Nepali Rupees on November 21, 2022. If a Nepali individual had invested 20 Lakhs NRs at that time, they would have easily amassed 70 Lakhs NRs by now. Some may argue that bitcoin is too costly and beyond the reach of the average Nepali citizen. However, one of bitcoin's appealing features is its divisibility. While the purchase of one whole bitcoin may appear excessively expensive, it can be divided into smaller units known as satoshis.
This highly people-centric innovation of bitcoin renders it accessible to a broader spectrum of individuals, as they can invest in or transact with fractions of a bitcoin, rather than necessitating the purchase of a whole coin. For instance, even amidst soaring bitcoin prices, individuals can still engage with bitcoin by acquiring smaller fractions, such as 0.001 BTC. This divisibility democratizes access to bitcoin, allowing individuals with varying financial means to partake in the digital currency ecosystem. More importantly, the accessibility offered by Bitcoin echoes the ideals championed during the 2006 uprising, which remain unfulfilled to this day. In contrast to Bitcoin, which can be easily divided and traded in smaller fractions, land represents a tangible asset with fixed boundaries, making it less adaptable and accessible to marginalized sections of society.
In the past century, communist regimes globally made lofty assurances that ultimately proved to be empty promises, resulting in widespread disillusionment and economic turmoil. Take, for instance, the Soviet Union, where the Communist Party ascended to power following the Russian Revolution in 1917. Initially, the party pledged to construct a classless society where the workers would own the means of production, guaranteeing fair distribution of wealth and resources. This vision, unfortunately, swiftly dissolved into a harsh reality of repression, economic mismanagement, and extensive hardship for the people.
Under the Soviet system, the state exercised complete control over every facet of the economy, including production quotas and distribution channels. Although this centralized approach appeared to promise efficiency and equity in theory, in reality, it resulted in persistent shortages of essential goods and services. For instance, despite its significant production of oil and natural gas, the Soviet Union grappled with providing sufficient heating to its citizens during severe winters. This shortage necessitated lengthy queues for basic necessities such as food and clothing, prompting individuals to resort to the black market to satisfy their needs. Coupled with this, prices surged, pushing everyday essentials beyond the reach of the average person.
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Another blunder committed by the Soviet regime was the suppression of innovation and entrepreneurship, which hindered economic growth and technological advancement. The absence of incentives for individual initiative resulted in the exodus of many talented individuals or their silence due to fear of retaliation. This suppression of creativity and ingenuity ultimately played a pivotal role in the Soviet Union's failure to compete with Western economies on the global stage. Similarly, the communist regime in Nepal appears to be mirroring history by committing analogous errors in banning cryptocurrencies and social media platforms like TikTok.
Prior to the communist takeover, Russia, with an illustrious heritage, stood as a formidable power, rivaling Europe in military prowess and influence. With its vast territory, strategic positioning, and formidable armies, the mighty nation served as a beacon of power in Eastern Europe, showcasing resilience and ambition on the global stage. Under the reign of Empress Catherine the Great and her successors, the Russian Empire expanded its dominion to the borders of Europe, emerging as one of the largest and most influential empires in the world. However, the once-potent Russian Empire met its demise as communism, with its promise of equality, justice, and a utopian society where resources and opportunities were equally distributed, ultimately failed to fulfill these pledges. Several factors contributed to the delivery shortfall.
Firstly, communism disregards human nature and the inherent drive for individual achievement and innovation. By advocating for the abolition of private property and the centralization of economic power, communism stifled individual initiative and entrepreneurship. In practice, this lack of incentive for people to work hard and innovate resulted in stagnant economies and widespread inefficiency.
Secondly, communist regimes often gave rise to authoritarian governments that systematically suppressed basic human rights and freedoms. The concentration of power in the hands of a ruling elite invariably led to widespread oppression, censorship, and the stifling of dissenting voices. Instead of fostering a society of equals, communism frequently fostered a hierarchical structure where party elites enjoyed privileges while the masses endured hardship. As many young people leave Nepal due to limited opportunities, the task of organizing peaceful protests within the country has become increasingly difficult due to heavy police repression. This situation is exacerbated by the fact that political leaders continue to enjoy luxurious lifestyles.
Nepal has witnessed remarkable communist leaders such as Mandan Bhandari, Man Mohan Adhikari, and Pushpa Lal Shrestha. Even among the leaders alive today, many have valiantly fought for democracy in the country. However, their endeavors faced challenges as they adopted foreign communist ideology. Communism, with its European origins and ideological foundations, often clashes with the cultural and historical context of a Hindu country like Nepal.
Furthermore, the republican setup, devoid of monarchy and religion, has failed to fulfill its grand promises because it lacks the traditional institutions and cultural frameworks that historically provided stability and coherence to the society, leaving a void that cannot be effectively filled by the new system.
Furthermore, the principles of communism often clash with the deeply ingrained cultural values and traditions of Hindu societies. Hindu ideals prioritize not only individual rights and duties but also the sanctity of family, community, and religious beliefs. Nepal's historical trajectory, shaped by its unique political and economic dynamics, adds complexity to the feasibility of implementing communist ideals in the country. Somehow, the communists overlooked the fact that the people of Gorkha faced a formidable challenge in uniting a country under one flag. It wasn't merely a matter of rhetoric; it was a complex undertaking executed with military precision. The unification process proceeded meticulously, with careful consideration of the religious and ethnic dimensions of the annexed regions, ensuring that the existing religio-ethnic harmony within these areas remained undisturbed.
The rich Hindu and Buddhist philosophies, emphasizing dharma (duty), karma (action), and moksha (liberation), underscores the importance of individual responsibility and spiritual growth.
These concepts do not align with the tenets of communism, which prioritize uniformity and centralized control over history, religion, and spiritual fulfillment. While communism may have gained popularity in the European context of the 18th century, it ultimately failed, highlighting its unsuitability for diverse and culturally rich religious nations like Nepal.
The discussion surrounding the legal status of bitcoin in Nepal reflects a broader global dialogue on cryptocurrency regulation. With the value of one bitcoin nearing one crore Nepalese Rupees, the debate over whether to ban or legalize bitcoin remains relatively muted within the country. Such discussions are important because bitcoin embodies the collective promise made by all political parties to provide opportunities for economically marginalized sections of society. The lack of regulatory measures for cryptocurrencies is a cause for concern. This dichotomy underscores a significant tension between decentralized cryptocurrencies and the centralized nature of communism. In any case, the government of Nepal cannot afford to isolate itself; instead, it should align with the global trajectory. The recent developments surrounding Bitcoin offer valuable lessons for Nepal to consider as it navigates its stance on cryptocurrency regulation.
With Wall Street now immersing itself in bitcoin, investors are witnessing the firsthand impact of its selling mechanism. Larry Fink, CEO of BlackRock, the world's largest asset manager, initially showed hesitation toward bitcoin but has since emerged as one of its most influential proponents. This year, BlackRock caused ripples in the financial realm by submitting an application to introduce an exchange-traded fund focused on bitcoin. Since their debut in early January, Bitcoin exchange-traded funds (ETFs) from BlackRock, Fidelity Investments, and other reputable firms have swiftly accumulated over $16 billion in assets. Combined with the significant Grayscale Bitcoin Trust, which recently transitioned into an ETF, these funds now boast assets exceeding $40 billion in Bitcoin. The question on everyone's mind: how can Nepal seize upon this trend?
Nepal, blessed with abundant hydropower potential, stands at a unique juncture to empower each municipality and village to establish their own micro hydro projects for bitcoin mining. This approach holds the promise of catalyzing economic growth and development at the grassroots level, nurturing entrepreneurship and innovation, and creating job opportunities and wealth within communities. Concurrently, it paves the way for advancing environmental sustainability and bolstering energy security. Furthermore, by drawing in bitcoin miners from across the globe, Nepal has the potential to establish itself as a pioneering hub for blockchain technology and cryptocurrency innovation, enticing top talent and significant investment.This strategic move could catalyze the creation of smart villages, where each municipality serves as a thriving center for bitcoin mining, fostering technological advancement and economic prosperity at the local level. Bhutan's bitcoin mining initiatives might offer valuable insights for Nepal.
The Kingdom of Bhutan has ventured into the development of bitcoin mining facilities due to the deep interest of its monarch, King Jigme Khesar Namgyel Wangchuck, in the cryptocurrency. He sees bitcoin mining as a potential solution to avert economic crisis in the remote, bio-diverse mountain nation, particularly as the country suffered from declining tourism during the COVID-19 pandemic.
However, currently, these forward-thinking aspirations in Nepal remain nothing more than wishful thinking.
(The author believes in regulating bitcoin because it can help address various concerns, including financial stability, consumer protection, and the prevention of illicit activities)
