Highlighting The Need for Conceal
Economic policies kicked off from the pandemic have been introducing volatility, uncertainty, and new challenges that have demonstrated why Bitcoin was originally created and even further why privacy currencies like Conceal are critical. Taking a look back at the banking crisis in 2008, a huge string of bank failures hinged on bad mortgage investments, is the most recent piece of evidence displaying the weaknesses of centralized banking. From a cultural perspective, centralized banking has been around for centuries and used by generations of people as a means to manage capital for individuals and businesses. Central banks are built and supported by the monetary policies dictated by a federal government, which supplies assurances to the banks and the customers of banks. The success of the banking system is built on a couple of conditions, those being:
- Limiting options on how individuals/business control their own capital
- Encapsulating a system, where choices seem available but ultimately roll back up to the same guarantees and promises
- Dictating terms of how people can do business with their own money
These terms of success for centralized banking establish a monopoly over the ability for people to manage their money, and how they do business and invade their privacy.
Set the Scene: 2023
As if the 2008 Global Financial Crisis hasn’t taught us anything, the world finds itself perilously in an even worst spot, a similar banking crisis to 2008 and worse yet, ramping inflation on the de facto global currency, US Dollar. The same terms of success still exist for banks, but since 2008 Bitcoin and other cryptocurrencies have been developed and evolved to enable self-sovereignty back to the individual. As market caps and usage around the world for Bitcoin and other cryptocurrencies have grown immensely over the past decade, challenges to the status quo from central banks have been noted and cryptocurrencies are now under siege. In the United States, projects and companies are being de-banked based on unspoken rules and guidelines from the Federal Reserve and Government. CBDCs (Central Bank Digital Currencies) are being explored across multiple nations which will give the federal governments a stronger clutch on invading privacy. Regulators are leading by ‘regulation through enforcement’ policies due to the lack of regulation set within the United States. Currently, the financial health of almost everyone across the world is filled with uncertainty, doubt, and questions about how things will play out.
Privacy and Purpose
At Conceal, the community is always passionate about the four pillars that serve as the foundation of the project. Indirectly, the global happenings with this current banking crisis and runaway inflation due to monetary policies help to reinforce the pillars. Those in crypto already understand the importance and need for self-custody, as the old saying goes:
Not your keys, not your crypto!
In banking terms, the saying is just ‘Not your money’ as a bank can default and the depositors in the bank will be left with nothing. Self-sovereignty can be achieved through self-custody and empowers the individual to spend, transact, and do whatever they want in a permissionless fashion. There is no need to trust a 3rd party to manage assets and choose how, when, and with whom you can interact with. Coupled with the concept of decentralization via a distributed network, censorship resistance can be baked into the protocol/network so that it truly is robust to disabling centralized failures.
The Conceal Network does not intend to be a bank in the conventional sense, but rather a gateway to aid in private, self-sovereignty. This point is vital as the limitations and points of weakness with centralized banking shouldn’t be replaced with a different type of ‘banking system’ but rather a new paradigm that gives control back to the individual. Conceal, like many cryptocurrency or blockchain projects, is aimed and designed to allow a user to control their own funds via their wallet and to transact freely. The privacy-by-design nature of Conceal further allows individuals to not have to worry about leaking information about themselves. Transactional cryptographic techniques combined with blockchain-based technology couple to create that new paradigm.
Puppet Master and Puppet
Through a naeive, or uninformed lens, the banking system might seem like a very helpful way in modern times to aid individuals with managing their money and investments. The problem is that as you peel back the layers and understand the real rules by which banks play and by which we as individuals play, one can see the glaring gap that always favors the house (or the bank). Systems that are in place like fractional reserves allow a bank to manage more liabilities than assets and really are a main driver of why ‘Runs on banks’ are a thing. This is the main point of failure why the three recent banks collapsed, clients feared that the bank’s collapse was imminent and then pulled out their funds. Since the banks run on the fractional reserve system, the assets of the others were loaned out in yield-bearing loans and not liquid for the bank to make customers whole, leading to the banks defaulting. Understanding that no one individual is allowed the ability to operate in a similar fashion shows how the game is about a different set of rules for banks and the common person.
In addition to different sets of rules, banks can make unilateral decisions on how people spend their money, either by halting transactions they deem questionable and/or by not letting an individual withdraw funds. Both of these claims that a bank has are valid under the current rules and why a totally new paradigm in how individuals manage and transaction stores of value. It might sound esoteric put in these terms, but when you don’t control your own funds you lose rights on how they should be managed. On top of the loss of control, if you don’t do it privately, then you forfeit personal information to someone who can data mine it out.
Don’t be the puppet on the strings, cut the strings that bind.
If there are additional ways we could help support the cause, and/or you want to help support us in this fight, reach out to the team in our Discord or across social media!