(If you want to skip my intro, just scroll down to sections: Monero is for Porn, Monero is for Pot and Monero is for Guns)
Monero is the Esperanto word for money, and I’ve reached the conclusion that money is precisely what Monero is. In previous articles, I’ve referred to money as being either sound or unsound, but I now believe that was the wrong approach. ‘Sound or unsound’ isn’t the question. The question is – “is it or is it not money?” Right now, there is nothing else on earth I am aware of that is also money[1], with the exception of precious metals (though they have very different medium of exchange profiles, and thus, usefulness). Of course this may change over time, and new forms of money may present themselves (for instance, with zk-starks), but for now, this is it.
Current fiat currency systems, which our world uses now, are not money. True money doesn’t allow a group to create money at whim, and direct it to whom they like. This violates the store of value rule. Fiat currency systems are in reality, just tokens – created and distributed by a select group who decide the rules for use.
Bitcoin and other alt-coins are not money. Because of the way they have been designed, privacy is at best optional (though often non-existent), and consequently, identifiable histories can be linked to transactions[2]. This is problematic for a number of reasons, but simply put, privacy is a technical requirement for fungibility, and fungibility is a binary and necessary trait for something to be money. And so, Bitcoin and other altcoins are not money… tokens, yes – and designed to be a better store of value than Fiat, but still not money.
Using something as money that truly is money has the potential to solve a lot of the problems of today’s world. It can do this by providing an alternative to our current broken monetary system which is currently riddled with such absurdities as engineered inflation, massive wealth inequality and endlessly funded institutionalized violence. This is why I, and so many others are excited by Monero’s potential as the only cryptocurrency that is money. But history has shown repeatedly the best product doesn’t always win. Marketing plays a huge part, and there are other coins (from Bitcoin to Bcash to Dash) which have far more significant marketing programs (whether centralized or decentralized).
But marketing is only ultimately effective if it gets people to buy and use the product being marketed. This tells us that the real driver for competitive success is adoption and use.And here’s where I see a real opportunity for Monero – because Monero, as a private and fungible money, has use cases with which no other altcoin or fiat note can compete. It is adoption and usethat will ultimately determine whether Monero will be successful, and in that vein, I offer three real, legitimate use cases which I believe can facilitate its adoption and use as something more than a speculation or investment vehicle.
Hey, I’d love it if the average-joe understood all the societal and macroeconomic implications of using cryptocurrencies in general and Monero in particular. But I’ll happily settle for than same average-joe simply usingMonero, and let time and experience further educate him on the bigger issues. In fact, this approach might just be what tips the scales - transforming Monero’s potential into kinetic reality. And if that man on the street doesn’t want to defend Monero by citing his porn, pot, or firearms habits – well then, he can just tell his friends he doesn’t like being spied on.
Monero is for Porn ( #pornero!)
From a porn user’s perspective, this is a no-brainer. Anyone who subscribes to a porn-site today and pays for it with anything other than a truly private payment method means their whole porn-history can be tracked and linked to their real-life persona (sorry Verge, but just because Pornhub has for some reason picked you, doesn’t mean you’re any good). For a lot of people, this is not an acceptable prospect, and so they either don’t subscribe at all, or try not to think about what would happen if the porn or credit-card companies sell this info (to private industry or government) or are hacked (remember the Ashley Madison leak?). But using Monero to pay for porn would break that link, and (assuming a user connects through a trusted VPN), provide the privacy which the vast majority of porn users want.
From a porn company’s perspective, offering Monero as a trusted payment method would be hugely profitable. Right now, only about 4% of porn-viewers actually ‘convert’ to paid users. In other words, 96 out of 100 porn-viewers never pay. But if a truly private way to subscribe were available (i.e., Monero) then each *1* of these 96 people who took advantage of this option and became a paid subscriber would translate into a profit[3]boost of 25%! In other words, if you run a porn-business… what are you waiting for? Set it up for Monero payment and boost your profits – don’t let Mariah Carey have all the fun.) The same really holds true for all sex-industry businesses, but I’ll leave that for you to ponder those implications.
From a Monero adoption perspective, this would be enormous as well. Best estimates are that 77% of Americans view porn once a month, or 77% x 325 million = 250 million users[4]. If only 1 out of 100 of these viewers became subscribers with Monero, then that would be an increase of the Monero user base[5]of 2.5 million people! If they on average spent $15 a month for subscription, then that would generate annual required Monero purchases of 2.5M x $15 x 12 months = $450 million in the U.S. alone!
Monero is for Pot ( #reefero? #gangero?)
Marijuana is increasingly legal in the U.S. (and other parts of the world), but the stigma associated with it continues to be very real. Never mind that if your insurance company believes you are a user of recreational drugs they’re likely to charge you higher premiums – legal or not. Tack on to this that a lot of credit-card companies won’t even bank pot dispensaries, and it’s no surprise that they so frequently transact in cash.
Using (and dispensaries accepting) Monero for marijuana purchases would be a terrific solution – providing privacy (that credit card acceptance wouldn’t provide, even if it was offered), allowing for remote payments, and saving dispensaries from the logistical difficulties of holding large amounts of physical cash. Of course, just like in the porn example, to the extent that having a new, truly private payment option convinced more people to become customers, well then – it would clearly boost sales.
Finally, it’s worth noting that there have been attempts in the past to create cryptocurrency specifically for marijuana transactions (potcoin). Ultimately though, as these coins are not truly private, they can’t hold a candle to Monero, and are instead more novelty than a scalable business payments solution.
Monero is for Guns
This is probably the most controversial of the three ‘fors’ I list here – even though what I’m speaking about are legal gun purchases as supported by the U.S. Constitution. I have (by and large) no desire to argue either side here, and am simply pointing out a use case that would be extremely valuable to participants in that economy.
Many gun purchasers do so under the auspices of the 2nd amendment, which they will tell you has nothing to do with hunting, and everything to do with protecting citizens from a corrupt and tyrannical government[6]. As such, it would make sense for these purchasers to want to keep their purchases private in the event that a ‘coming for your guns’ scenario plays out.
Well, unfortunately for them, outside of using cash, their options are quite limited. Credit cards intimately link the guns to purchasers, and compilation of this data is actively being developed (though I personally would be shocked if it hasn’t already been done – and these headlines are just warming up the public to the official announcements).
Yet again, Monero offers a solution – truly private transactions – effectively anonymous digital cash. I won’t run through the numbers here on market opportunity for gun shops to accept Monero – but suffice it to say that any offering which makes it easier for their customers to make new purchases will of course boost business and profits.
However, I will quickly run through the Monero adoption scenario. It’s estimated U.S. Gun and Ammunition stores generate annual revenues in the neighborhood of $3.1 billion. If just 5% of those purchases are made with Monero, that equates to an incremental annual ‘Monero purchase demand’ of $155 million – again, in the U.S. only!
Summing Up
If you are in the Monero community, you might be annoyed at me. You might be saying, “Hey Izzy – thanks for nothing. We’ve worked so hard to fight the wrong and unfair stigma of being a ‘dark coin’… and now you’re associating Monero with pornography, pot, and guns?!”
If this is how you feel, first let me say I understand your position. I would however offer three points for you to consider.
1) The single most powerful long-term indicator of any alt-coins success is whether people use it. With numbers like those illustrated in this article, Monero would be catapulted into the status of one of the most used cryptocurrency worldwide – if not the most. And as we know, success breeds success – use breeds use. This could be a fantastic springboard into mainstream awareness and adoption.
2) The more people use Monero, the more people with defend Monero.
We in the Monero community understand that it represents the single biggest threat to the established monetary system since Bitcoin. And since Bitcoin has been beaten, sites have been set on attacking Monero. But if a significant portion of the populace uses Monero, it will have more defenders and supporters. Furthermore, the fact that there are so many non-porn/pot/gun related reasons to be a Monero supporter gives the average user plenty of air-cover to defend it without announcing him or herself as a porn user.
“I support Monero because I believe in privacy, fungibility and sound money. Oh – what’s that you say? People use it for porn? Ah well, cest la vie. I certainly wouldn’t use it for that! But it’s still vital to our civil liberties!”
3) There’s a delicious irony to harnessing people’s “base” habits and desires to facilitate healthy societal change.
While the ‘Powers that Be’ seek to corral and control the masses with bread and circus, here we are, harnessing those very same base-impulses (at least with regard to porn) and redirecting them toward a mechanism that may actually help free the masses from a corrupt monetary system. What can I say? I like the sound of that.
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[1]Yes, I am dictating my own definitions. But where have the standard economic definitions come from? And do they do what definitions are meant to do – describe the world around us in the best way possible? I believe my change here does a better job of this.
[2] Anonymity sets will simply never consistently be large enough without default privacy through the chain’s direct ecosystem. That this also means Bitcoin can ultimately be used as a surveillance and control mechanism illustrates how important it is that we avoid things that aren’t true money.
[3]Assuming gross margin of incremental subscribers is near 100%.
[4]Let’s assume that these are all online users.
[5]Assuming they weren’t already Monero users.
[6]Have you seen “The Handmaid’s Tale”? Would that dystopia have been possible if citizenry had arms to protect themselves? Just asking.
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