ROSC 8: The Exchange

TheExchangeI don’t use phones very often; most days I talk on the phone no more than once or twice, and often not at all. Phone calls interrupt me, and interruptions waste a lot of my time… I have to figure out where I was before the call, reassemble the pieces, and get going again. In the construction business, we used to call that demobilization and mobilization, and it led to serious losses.

And so, back in the 1990s, I trained all my friends and business associates to email me, not to call me. Emails don’t interrupt you… unless you’re silly enough to add a ring tone. Michele at Jay’s Bar, however, has the number of my business phone; he’s used it occasionally to confirm reservations. And he surprised me last week with a phone call. It started like this:


“Hi, this is Michele, from Jay’s Bar.”

He sounded like something was on his mind.

“Hi Michele, what can do for you?”

He hesitated and then answered with his voice lowered, as if he didn’t want someone to hear him. “I didn’t know if I should call you or not, but the girl from your meetings is here, and she’s sitting in the back of the bar, crying.”

I almost asked Michele if he was sure it was the same girl, but I knew better. He didn’t make that kind of mistake. Still, I didn’t know what was best to do. And so I decided to do something rather than nothing.

“If you would, please, Michele, ask her to come to the phone.”

“Wait,” he said. “Another of your group is here… a young guy. He’s going to her.”

That had to be Johnny.

“A polish kid?” I asked.

“Yeah. Could be.”

“What are they doing?”

“Well, he’s sitting next to her… putting his arm around her… and she’s crying on his shoulder.”

“Okay, then we should stay out of their way. Thanks very much for calling, Michele.”

“You bet.”

I found out at our next meet-up that Esther’s mother, Dora, had been diagnosed with inoperable cancer. It’ll be a few months and no more. Given her unusual circumstances and her relatively young age, that had to be a major blow to Esther. And I was very pleased with Johnny; he stepped up and handled it the way a man’s supposed to. God bless him.

But no one uttered a word of this at the next meeting. Esther told me only afterward, as we headed back to the train station.

The meeting did, however, center on the people at the sanitarium. The kids in my little group – and I think all of them are young enough to be my children – have taken up the sanitarium as a cause. (Don’t tell me free people aren’t charitable enough.) They had a long list of business ideas for them.

The first idea that caught my attention was running a Bitcoin exchange, and it caught my attention because it was extremely dangerous. Granted, this was a very clever way to do it, but that’s the kind of thing that the Feds are searching for these days – they want to shut down every avenue of cryptocurrency transfer to national currencies… or at least the ones they don’t control.

They’re arresting people wildly to scare everyone else off. It’s terroristic, to be frank, but Fed agents believe their rules are from God. What’s worse, these guys are worshiped in an unending series of TV shows and movies, and they get promotions for punishing the crime-of-the-month.

The idea was to set up a decentralized and modular cryptocurrency exchange system. At its core would be the Ripple system and a bidding structure like Google ads. A user would ask to exchange their cryptocurrency, and chains of others – none of whom may know each other – would bid on fulfilling parts of the order.

One might change Litecoin to Monero, another change that into dollars on a prepaid Visa card, and then another take the currency off the card and deliver it in person or by messenger. And so on, limited only by the imaginations of the players. Ethereum contracts would handle the escrow and payouts, and an independent blockchain would verify all the details as the orders progressed. They planned on using Open Bazaar’s old reputation system as well. There would be no center, only a protocol.

As I say, it was an intriguing idea, but I told them, urgently, that this could not be done in the United States and perhaps almost nowhere else as well.

“They will throw millions of dollars at hunting you down, if you do this,” I told them.

I almost started recounting the story of what the feds did to Ross Ulbricht. But the whole purpose of that disgrace was to instill fear, and I wasn’t going to help them in their filthy mission.

“Yes,” I insisted, “what those people are doing is barbaric, but barbarians have done a hell of a lot of damage in the world. I don’t want you guys to be next in line.”

“Then how could it be done?” Mike, one of the newer kids, asked.

“Mike, this is a job for old men… for very old men and women.”

They all looked at me with blank faces.

“This is the kind of thing you do when you’re 85 or 90 years old and you don’t give a damn if they come after you. What’s the worst they can do against someone that old? Send them to prison for life?”

They got the point.

“But if someone wanted to dance with martyrdom, they’d have to do it somewhere beyond the easy grasp of the US government. And I’m not sure where that would be these days. Laos or Cambodia maybe, or possibly Brazil. But the real way to do it would be Satoshi’s way: Write it, drop it into the world, and vanish.”

Then I steered the conversation to other subjects. I’ll give you more details next time.


Paul Rosenberg