The world of bitcoin and cryptocurrency has been rocked this week by an attack on crypto by the co-creator of the meme-based dogecoin—something he said he made as a “joke.”
In a series of tweets, Jackson Palmer, who developed the tongue-in-cheek dogecoin in 2013 only for it to grow to a value of $25 billion, branded the entire crypto market “an inherently right-wing, hyper-capitalistic technology built primarily to amplify the wealth of its proponents through a combination of tax avoidance, diminished regulatory oversight and artificially enforced scarcity.”
Now, the chief executive of bitcoin and crypto exchange Coinbase has hit back at Palmer, arguing “crypto is simply providing an alternative for people who want more freedom” and bitcoin has “made so many people wealthy.”
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“If you believe the government should be the solution to people’s problems, then the fiat system with its ‘controls’ has a lot to offer,” Armstrong, who has courted controversy with a “no politics at work” policy at Coinbase, said as part of a lengthy Twitter thread.
“Crypto is not going to solve wealth inequality—it’s not trying to create the same outcome for everyone,” Armstrong wrote. “But it does create wealth mobility and more equality of opportunity for everyone. It levels the playing field, at least to some degree.”
The bitcoin price has climbed from pennies at the beginning of the last decade to over $30,000 per bitcoin today, creating a $1 trillion cryptocurrency market and making many early adopters overnight billionaires. Bitcoin was created by the mysterious person or persons known only as Satoshi Nakamoto, whose true identity remains unknown, and who developed bitcoin as a response to the 2008 global financial crisis as a way to send value over the internet without reliance on banks or payments platforms such as PayPal.
While a number of attempts to create digital currencies had been tried before, bitcoin’s blockchain technology solved the so-called double spend problem with a distributed ledger maintained by miners in return for freshly-minted bitcoin tokens.
Armstrong’s comments were in response to Palmer’s claims the whole crypto industry is an exploitative scam that benefits the wealthy.
“The cryptocurrency industry leverages a network of shady business connections, bought influencers and pay-for-play media outlets to perpetuate a cult-like ‘get rich quick’ funnel designed to extract new money from the financially desperate and naive,” Palmer posted earlier this week in a thread that quickly went viral.
“Financial exploitation undoubtedly existed before cryptocurrency, but cryptocurrency is almost purpose-built to make the funnel of profiteering more efficient for those at the top and less safeguarded for the vulnerable.”
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Palmer, who created dogecoin along with fellow developer Billy Markus, said he has no plans to engage further with the bitcoin or cryptocurrency space.
The dogecoin price has surged by many thousands of percent since the beginning of 2021, with investors pouring cash into the memecoin in the aftermath of trading restrictions being placed on viral meme stock Gamestop in January.
Dogecoin tokens traded for mere fractions of a cent for years before surging to an all-time high of $0.73 in April on the back of an Elon Musk-fuelled pump. The dogecoin price has since crashed back to under 20 cents but remains in the crypto top ten by value.
Musk, the irreverent Tesla billionaire who’s apparently adopted dogecoin as a pet project after years of jokey support for the cryptocurrency, has recently suggested upgrades to help dogecoin “beat bitcoin hands down” and promised to put a “literal dogecoin on the literal moon” via his company SpaceX.