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Why Your Alt-Coin Is No Good Here

Published on February 14th, 2014 by bcohen

By Brian Cohen

Stanley Kubrick is known for being a filmmaker and not a cryptographer.  However, Kubrick’s films have hidden “fractal” narratives with coded messages that Rob Ager has been deciphering through his amazing film analysis on his website Collative Learning and on Youtube.  In "Mazes, Mirrors, Deception and Denial: Chapter 15: This is our Gold Ballroom" Mr. Ager puts forth his theory that there is a sub-plot in The Shining that revolves around the gold standard.  The Shining was released in 1980, not long after the  U.S. dollar's fixed value against gold under the Bretton Woods system ended.  More specifically, President Nixon announced on August 15, 1971 the end of the gold standard.

Kubrick’s films, which can be interpreted on different levels, use dialogue that can have more than one meaning:

“Your money’s no good here.” said the bartender Lloyd to Jack Torrance (Jack Nicholson) in the Overlook Hotel’s “Gold Room.”...“Orders from the house.”

(Note: Haven’t seen The Shining yet?  It’s not on Netflix Streaming but you can add it to your DVD Queue or review plot summaries over at IMDB.)

There is a subtext going on here and the Gold Room bartender is conveying three messages simultaneously:

1) The drink is free

2) We don’t accept your kind around here (i.e people who pass bad money---see #3 below)

3) The money you propose to pay for your drink is not a valid form of payment and is a false substitute for the real thing.

“Your money’s no good here.” can have very different meanings depending on how and when it is used.  In the case of Jack and the Bartender’s conversation it absorbs all meanings just as the Overlook Hotel absorbs Jack into its nexus.

Message Board user Astorian over on The Straight Dope forums hit the nail on the head when he explained how the meaning of this phrase has morphed over time:

“I always figured this was a case of an older NEGATIVE catchphrase being turned on its head, and used in a positive way….That is, in the Old West, if a scruffy, undesirable-looking person walked into a saloon, he might have been told sternly, "Your money's no good here," as in "We don't intend to serve you, so get lost.”

“In the Old South, a black man seeking to eat at a restaurant or shop at a whites-only store might have been told the same thing. In that situation, "Your money's no good here "meant, "I don't care if you have money to spend, YOU are not welcome here."

“Over time, those practices have largely vanished, but people remembered the old phrase, and started using it in a different way. If, for example, a bunch of guys are taking a buddy out to a restaurant or bar for his birthday, they may tell him, ‘Your money's no good here’, meaning ‘Tonight, you don't pay for anything, it's all on us.’”

The first known usage of this phrase to play on its dual meanings was in “The Finding of Zach” (circa 1900) by Paul Laurence Dunbar:

[Location: At a Bar]

“Your money’s no good up here.”

"Wh-why-why, I thought dis money passed any whah in de Nutied States!" exclaimed the bewildered old man."

"That's all right, but you can't spend it until we run out. [of drinks]"

"Oh! Why bless yo' soul, suh, you skeered me.  You sho' is clevah."

This “old man” tried to spend a National Bank Note which were issued between 1863 and 1938. The design of these standardized notes were the same “regardless of place of issue, differing only in the name, location, and charter number of the bank.”  So naturally he was confused about his money being no good.  He was probably old enough to remember when U.S. currency wasn’t standardized.  Private banks issued their own currency and convertibility of notes between different regions (i.e. the old man was an out of towner) was an endeavor. This period from 1837 to 1862 was known as the “free banking era.”   Episode 421 of Planet Money, “The Birth Of The Dollar Bill” discussed how cumbersome it was to accept and spend money in this environment.  There were as many as 8,000 different notes, banks had lifespan averages of just five years and frequently collapsed.  Merchants had to rely on a Bank Note Reporter to pass judgement on banknotes in circulation.  The further away the note holder was from the issuing bank the more likely a merchant would reject the payment.  Notes from financially unsound and bankrupt banks were called wildcat notes, shinplaster, shingles, stump tails, and red dogs. This was the money that “was no good up here.”

On The House

Returning to The Shining, Rob Ager explains how

“...Jack [is] an incarnation of President Woodrow Wilson and his relationship to America’s monetary system. In particular “Orders from the house” could be a reference to Colonel Mandell House, the personal advisor who guided Wilson in surrendering the US government’s right to issue currency to the private bankers. Another possibility is that “Orders from the house” could be referring to the European-based House of Rothschild, a banking dynasty which had dominated and controlled the majority of Europe’s central banks for hundred’s of years and which was also rumoured to be the behind-the-scenes controlling force of the Federal Reserve System…”

Just as the Overlook hotel changed Jack Torrence (he went insane), the meaning of money has changed over time.  Money had intrinsic value backed by gold and silver, but we are now left with a doppelganger.

Legal Tender … For Debt

There is no federal law which requires businesses to accept cash as a form of payment.  The U.S. Treasury explains how “private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise.”  The Federal Reserve also notes the same on its website.  However, I found this interesting piece from the Wall Street Journal that explains how a restaurant would have to accept Federal Reserve Notes (i.e. cash) as a form of payment under law:

“... in a restaurant, you usually pay after you’ve eaten the food...A restaurant that allows someone to incur a debt (eat their food) and pay later becomes a creditor and would be required to accept legal tender to satisfy that debt..”


Your Bitcoin is No Good Here

Bitcoin is an opt-in digital currency.  There is no central authority and it is not legal tender in any national boundary.   Canada is the most recent nation state to re-iterate this informally through the media and perhaps more formally through Policy Horizons (a federal public service): “...governments will never confer the status of legal tender on private currency..." While not “illegal tender,” no person or entity or government is forced to accept it.  While this may seem obvious, when a not for profit is involved this declaration might seem a little more fuzzy.  There is an extra layer of complexity and perhaps even an ethical dilemma when a charity refuses a donation.  Some have even questioned the legality of a charity refusing a donation.

A recent Freedom of Information request in the United Kingdom discussed the Institute of Fundraising’s Guidance on Acceptance and Refusal of Donations and explained that:

“...the law requires charity trustees to consider the charity's best interests, taking an overall view.  The law allows practical and ethical factors to be taken into account as long as these are likely to affect the specific interests of the charity.  Decisions to refuse donations should be recorded as this will demonstrate that the charity has identified and properly considered the risks and is transparent about the decision-making process.  This is important for being able to show that the charity trustees have acted responsibly...”

There have been many campaigns over the past several months petitioning different organizations including both for profit and not for profits to accept Bitcoin. Most recently there has been a campaign for Amazon to accept Bitcoin which gained momentum after CEO of Overstock Patrick Byrne stated that Amazon would be compelled to accept the cryptocurrency.  However, no campaigns have been more contentious than that of Wikimedia, the parent organization of Wikipedia.

Bitcoin Forum “Hero Member” gmaxwell, a “partner” with the outgoing Wikimedia chairman for the last decade and who has a long personal involvement in Wikimedia… had this to say about a Wikimedia bitcoin drive:

“...Soliciting funds on behalf of Wikimedia from random forum members in order to hold a fundraising "ransom" is not likely to help convince senior wikimedia executive staff (Or some of its well known and outspoken community members) who steadfastly believe Bitcoin is inherently a scam and Bitcoin users are a mixture of rubes and scammers.”

“...And, as an aside, as a matter of current policy— Wikimedia doesn't generally take funds with strings attached, and has never— to the best of my knowledge— accepted donations which required promoting the donor on the site's pages (beyond the pages that list donors, of course), even ones much larger than the Bitcoin community is likely to offer. Wikimedia also does not generally accept gifts in kind. I can only imagine that a promotion-encumbered "donation" offer would only improve the credibility of people arguing that Bitcoin is a pump-and-dump scam…”

There is some irony that an organization that is so steadfast against censorship would be opposed to accepting bitcoin donations.  As the Wall Street Journal recently published in “Wikipedia Co-Founder Refuses to Comply With China’s Censorship,” “Wikipedia Co-Founder Jimmy Wales said he would rather have no Wikipedia in China than comply with any [emphasis LTB] form of censorship.”  However, Jon Matonis, now Executive Director of the Bitcoin Foundation wrote in “Wikipedia Accepts 'Enemies Of The Internet' Currencies” and “WikiLeaks Bypasses Financial Blockade With Bitcoin” for Forbes” that:

“Bitcoin is immune to the political pressures faced by PayPal, VISA, and Mastercard during the infamous Wikileaks payment blockade. Given that Wikipedia ‘blacked out’ on January 18, 2012 in ardent opposition to SOPA and PIPA, bitcoin would also appear to be amazingly aligned with objectives for a free and open Internet….It should be offensive to most free-minded people that you are not the final arbiter of how and where you spend your money. Bitcoin restores the balance.”

Wikipedia’s position on Bitcoin has not changed (other than a dedicated shortened URL to the topic):

“The Wikimedia Foundation, as a donor-driven organization, has a fiduciary duty to be responsible and prudent with its money. This has been interpreted to mean that we do not accept "artificial" currencies - that is, those not backed by the full faith and credit of an issuing government. We do, however, strive to provide as many methods of donating as possible and continue to monitor Bitcoin with interest and may revisit this position should circumstances change.”


Your Altcoin is No Good Here

Bitcoin, the world’s first supranational currency, created unifying experience among its users around the globe.  However, in a bit of irony, Bitcoin’s success has spun off a number of altcoins that created a fragmented landscape.  The Thanksgiving 2013 runup of Litecoin prices and the introduction of the Discordian cryptocurrency Dogecoin are the driving force behind the recent altcoin gold rush.

Andy Greenberg of Forbes spoke with ZeroCoin developer Matthew Green in “Bitcoin Anonymity Upgrade Zerocoin To Become An Independent Cryptocurrency:”

“...Green says he was inspired by the rise in value of the new cryptocurrency Dogecoin–a mostly-frivolous creation based on the “Doge” dog-picture meme… ‘If people will put money into Dogecoin, they’ll put it into anything,’ says Green.”

There has been a confluence of events that will continue to increase the number of altcoins available.  While Bitcoiners continue to petition legacy institutions to accept Bitcoin as a form of payment, there isn’t a shortage of institutions that that are willing to accept Bitcoin.  Money is only as good in so far as you are able to spend it. Litecoin recently received a push with GoCoin, “GoCoin First to Enable Merchants to Accept Litecoin on the International Alt-Currency Payment Platform.”  Whether or not we will see transaction enablers and “payment platforms” in other altcoins will reveal if altcoins are shinplaster or a paradigm shift.  After all, Bitcoin is just an “altcoin” to anyone who hasn’t used it yet…

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