Tucker interview of Lavrov

December 8, 2024

2024_12_06_18_12_09_Kremlin_issues_ultimatums_in_Lavrov_s_interview_with_Tucker_Carlson

MSN has the audacity to publish Ukrainian propaganda, and they, of course, criticize Tucker Carlson for even interviewing any Russian. They claimed that the interview only “outlined the Kremlin’s demands regarding the war in Ukraine in this interview, reiterating typical Kremlin propaganda narratives.” The Ukrainian propaganda actually wrote: “This isn’t Carlson’s first foray into Kremlin-approved journalism. Back in February 2024, the ever-objective host managed to secure a two-hour interview with Vladimir Putin, where the Russian dictator flexed his well-rehearsed tales of historical revisionism and grievance politics.”

Nero Bosporus Intervention

Crimea has been fought over countless times. Here is a coin of the Roman Emperor Neo, who was forced to intervene in Crimea as well. Go back further; it was occupied by the Greeks. They love to put out their own propaganda about history when Ukraine was never a country. The monetary history of the region does not support Ukraine’s claims of past glory. They claim that Putin in his interview “mostly delivered his deeply unscientific interpretation of Ukraine’s history and its relations with Russia, while Carlson mainly listened without questioning or contradicting him.”

Kiev Golden Gate r

In truth, Kiev was the home of the Rus (Russians) until the Mongols invaded and destroyed their capital in 1220. All that remains standing is the single gate. This is like the Americans respecting London or the Jews maintaining that Jerusalem is their ancient land. The Ukrainians are generally not respected by their neighbors as being just corrupt.

Khruschev

The IMF and everybody else routinely say that Ukraine is the most corrupt state on the planet. Simply because Krischev rebuilt Kiev after the war and redrew the border for administrative purposes, the Ukrainians call this their homeland when it never was. Not only did Kruschev come from this region, but his successor, Brezhnev, was even born in the Donbas. This is what the entire world is to thrust into World War III for a territorial grab.

Neocon Couple Kagan NulandAll we ever hear from the press is the propaganda put out by the Neocon couple and their sister-in-law running the Institute for Study of War. They all have ties to this region, and this has been a family feud against Russia. They all insist Russia persecuted their families.

Nuland was there at Miadan, handing out cookies and water and cheering on the government’s overthrow. Then, she hand-picked an interim government and directed this UNELECTED government to start the civil war against the Donbas and the Russians.

 

 

The Tyranny in Canada Accelerates

December 7, 2024

Canada 3rd Wave ECM

The Third Wave of Canada ended in 2022, and we have begun the Fourth Wave, leading to more authoritarianism, and the Trudeau government seeks to retain power. But this immediate 8.6-year wave reaches its peak in 2026.59. There is no question that the centralized government of Trudeau recognizes that the end is near. They are responding like most others, realizing that centralized control from government has run its course, and the upheaval we see in the aftermath of the Trump victory with the governments of Germany and France cascading toward civil unrest is on the timeline for Canada as well.

Most Canadians do not make the connection between the 1930 Imperial Conference and the passing of the Statute of Westminster in 1931, which recognized Canada’s independence as it became co-equal with the United Kingdom.

Britain Suspends Gold Standard 9 21 1931

The sovereign Debt Defaults of 1931 also resulted in the fall of British rule over Canada. Had it not been for these defaults, nothing would have changed for Canada. That debt crisis led to the Statute of Westminster in 1931. We are now cascading into the next sovereign debt crisis that we have already begun to witness in France, where government debt falls below corporate and French sovereign rates, which have exceeded those of Greece.

Canada Unemployment Y 12 7 24

There is little question that the Canadian economy has turned down with the Economic Confidence Model (ECM) turning point here in May 2024. When we look at the Unemployment model, we can see that 2024 was a Double Directional Change and we are cascading into 2025. There will be yet another Directional Change in 2026, taking us into a trend into the ECM due in 2028.

Trudeau and Castro

Canada’s Prime Minister Justin Trudeau said back in October that he would lead his Liberal Party into the next election, dismissing a request by some party members not to run for a fourth term. More than 20 lawmakers from his own party signed a letter asking him to step down before the next election. Trudeau is out of touch with the people and is acting very much like a dictator, as some continue the rumor that he is really the son of Fidel Castro after the alleged affair of his mother with Fidel. That was not helped by his statements telling a Toronto fundraising crowd that he admired China’s “basic dictatorship.”

The next Canadian election will be in 2025 and will take place on or before October 20, 2025, to elect members of the House of Commons to the 45th Canadian Parliament. The critical monthly targets in 2025 will be March, July, and October.

 

 

After the attack on freedom with the Truckers, Trudeau is using Ukraine as an excuse to confiscate guns in Canada “immediately” with no due process notice whatsoever, acting as a dictator. Trudeau has so profoundly harmed the Canadian economy that fear is rising about civil unrest, and the answer is to disarm the people in a true dictatorial fashion. Canada is confiscating citizens’ guns and sending them to Ukraine to Kill Russians in the name of the Neocons. This is yet another act demonstrating that Trudeau has no respect for even democracy that would allow the people to vote on such a confiscation.

 

Market Talk – December 6, 2024

December 6, 2024

Market Talk 2017

ASIA:
The major Asian stock markets had a mixed day today:
• NIKKEI 225 decreased 304.43 points or -0.77% to 39,091.17
• Shanghai increased 35.22 points or 1.05% to 3,404.08
• Hang Seng increased 305.41 points or 1.56% to 19,865.85
• ASX 200 decreased 54.00 points or -0.64% to 8,420.90
• SENSEX decreased 117.63 points or -0.14% to 81,648.23
• Nifty50 decreased 30.60 points or -0.12% to 24,677.80
The major Asian currency markets had a mixed day today:
• AUDUSD decreased 0.00671 or -1.04% to 0.63854
• NZDUSD decreased 0.00404 or -0.69% to 0.58316
• USDJPY decreased 0.096 or -0.06% to 150.018
• USDCNY increased 0.01988 or 0.27% to 7.28338
The above data was collected around 13:17 EST.
Precious Metals:
•  Gold increased 4.07 USD/t oz. or 0.15% to 2,637.86
•  Silver decreased 0.27 USD/t. oz. or -0.86% to 31.079
The above data was collected around 13:21 EST.
EUROPE/EMEA:
The major Europe stock markets had a mixed day today:
•  CAC 40 increased 96.34 points or 1.31% to 7,426.88
•  FTSE 100 decreased 40.77 points or -0.49% to 8,308.61
•  DAX 30 increased 25.81 points or 0.13% to 20,384.61
The major Europe currency markets had a negative day today:
• EURUSD decreased 0.00268 or -0.25% to 1.05592
• GBPUSD decreased 0.00196 or -0.15% to 1.27394
• USDCHF decreased 0.00017 or -0.02% to 0.87833
The above data was collected around 13:25 EST.

US/AMERICAS:

US Market Closings:

  • Dow declined 123.19 points or -0.28% to 44,642.52
  • S&P 500 advanced 15.16 points or 0.25% to 6,090.27
  • Nasdaq advanced 159.05 points or 0.81% to 19,859.77
  • Russell 2000 advanced 12.83 points or 0.54% to 2,408.99

 

Canada Market Closings:

  • TSX Composite advanced 11.76 points or 0.05% to 25,691.8
  • TSX 60 advanced 2.24 points or 0.15% to 25,691.8

 

Brazil Market Closing:

  • Bovespa declined 1,894.08 points or -1.48% to 125,963.5
ENERGY:
The oil markets had a negative day today:
•  Crude Oil decreased 0.824 USD/BBL or -1.21% to 67.476
•  Brent decreased 0.683 USD/BBL or -0.95% to 71.407
•  Natural gas decreased 0.0026 USD/MMBtu or -0.08% to 3.0764
•  Gasoline decreased 0.0168 USD/GAL or -0.87% to 1.9163
•  Heating oil decreased 0.0145 USD/GAL or -0.67% to 2.1417
The above data was collected around 13:29 EST.
•  Top commodity gainers: Coffee (5.29%), Cotton (3.63%), Sugar (2.15%) and Canola (2.42%)
•  Top commodity losers: Oat (-2.04%), Methanol (-4.63%), Aluminum (-1.42%) and Butter (-3.11%)
The above data was collected around 13:36 EST.
BONDS:
Japan 1.0530% (-1.96bp), US 2’s 4.11% (-0.042%), US 10’s 4.1580% (-1.7bps); US 30’s 4.34% (-0.006%), Bunds 2.1035% (-0.05bp), France 2.876% (-1.7bp), Italy 3.1930% (-0.75bp), Turkey 27.79% (-15bp), Greece 2.886% (-0.4bp), Portugal 2.510% (+0.7bp); Spain 2.757% (+0.7bp) and UK Gilts 4.2800% (-0.78bp)
The above data was collected around 13:40 EST.

Insurance the #1 Consumer Fraud in America

December 6, 2024

Insurance

QUESTION: Why have you not commented on the killing of Thompson in NYC?

DD

ANSWER: I don’t know what you want me to say. I think this was inevitable, as insurance companies are the #1 consumer fraud rip-off of Americans every day of their existence, and they grease the palms of politicians to be exempt from consumer fraud. I have NEVER had any insurance company EVER honor what they pretend. I was self-insured here for the storm. A guy a couple of doors from me was paying $40,000 yearly for insurance, and they denied all his claims. He will no longer buy insurance. One of my staff had her car parked, and a drunk guy slammed into it, totaling the parked car. Her insurance company said he had to be paid by the other one, over a year and no payment. My mother’s house had a pipe freeze. They sent investigators asking neighbors if she was there because she went to stay at my sister’s. They have a clause that if you are not there, they will not pay. That cost me $50,000 to fix her home. In a storm, the top of the tree broke and lunged into a brand new Porsche, maybe 2 weeks old. I sent it to the Porsche dealer, who sent it to Bordentown Autobody, which burned down with my car inside. Allstate said it was two deductibles.

They charge your car insurance on the value you pay for brand new. Put in a claim, and it is suddenly depreciated, yet they continue to charge you on the original price. They NEVER reduce your car insurance in proportion to the depreciation. That is consumer fraud, and our politicians do NOTHING!

Insurance companies kill people all the time. This was inevitable. The shell casings found at the scene where the UnitedHealthcare CEO was shot dead by a masked gunman in front of a busy New York City hotel had “deny,” “defend” and “depose” written on them. This was retribution. It is a shame that it will not change the culture of insurance, and the police and politicians will love to hunt down this guy and kill him in a blaze of glory. Nobody will ever look at the corruption that sent this guy over the edge. I am very concerned that we may see others start to do the same, for those in the insurance industry will always worship the penny over the lives they pretend to care about. Our politicians line their pockets at the expense of We the People.

 

Volkswagen Protests – The Contagion Begins

December 6, 2024

Volkswagen Symbol

Tens of thousands of Volkswagen employees have halted production to protest proposed pay cuts. The German automaker has stated it will need to close three manufacturing plants due to rising labor expenses, material shortages, and, most importantly – the climate change agenda that has demonized fossil fuels.

Over 120,000 workers now face a 10% pay cut if they can manage to keep their jobs. The IG Metall union has warned that protests will be fierce. Volkswagen remains Germany’s top-selling car brand, composing 19% of the market share. Yet profit margins have dropped from a forecast of 7% to 5.6% for 2024 after the company’s cash flow turned negative in the first half of the year. The company states it needs to save 10 billion euros by 2026 in addition to finding a way to cut another 4 billion euros. Operating profits have fallen by 11.4% and they simply cannot continue producing these EVs at the same pace they were producing dreaded fuel-powered cars because the demand is not there.

Now many blame China for providing state subsidies for EVs that are far cheaper than the vehicles produced in Germany. This is why places like the US have placed a 100% tariff on those vehicles so that there is no demand. However, there is simply low demand for electric vehicles everywhere. You cannot force people to buy EVs even if you destroy the energy sector and make prices skyrocket 300% as they did by killing Nordstream. Pushing manufacturers to switch to meet these arbitrary emission targets is killing the entire auto sector which is about 17% of Germany’s entire GDP.

Germany believes it can reduce carbon emissions by 65% by 2030, followed by an 88% reduction into 2040 before meeting gas net neutrality in 2045. They claim that Germany is five years behind on its adoption of electric vehicles as it is far from meeting its goal of 15 million EVs by 2030. The average EV price in euro shot up 7.5% in the past year to €56,669. Infrastructure and charging stations remain inadequate to meet these goals.

Germany relies heavily on automotives, and Europe relies heavily on Germany as its top economy. Now, due to climate initiatives, Volkswagen is closing plants for the first time in its 87-year history. Pay close attention to Germany’s automotive sector, as it could easily cause a ripple effect throughout the entire European economy.

Britain has gone WOKE

December 6, 2024

wokemath

Britain has become a WOKE nation under Starmer who is eager to adjust the culture to fit this new narrative. There are countless stories of censorship coming from the UK, but one of the most bizarre stories is the British Board of Film Classification (BBFC) placing a trigger warning on the film “Wicked” for discriminating against fictional characters.

The PG-rated musical “may be upsetting and poignant for some audiences,” according to the BBFC. Why? “A green-skinned woman is mocked, bullied and humiliated because of her skin colour,” the agency stated. “Talking animals are persecuted in a fantastical society,” the warning continues. Everyone and anyone is now considered a victim under the WOKE movement. I cannot think of a single film that would not be deemed offensive in some way under these vague guidelines.

The only group of people you can openly offend are the Christians. Football/soccer Crystal Palace defender Marc Guehi has been canceled for writing “I love Jesus” on a rainbow LGBTQ+ armband that the Premier League forced players to wear. “It was a message of love, of truth as well. A message of inclusivity so I think it speaks for itself,” Guehi told reporters after the league considered penalizing him.

The player’s father defended his son’s demonized actions: “The FA are happy for the crowd to sing God Save The King when England plays, which mentions God and religion. And they are happy to have the religious hymn Abide With Me during the cup final and yet they have a go at my son for expressing his beliefs. Where is the sense in that? What exactly has he done wrong?”

Ipswich Town captain Sam Morsy, who is Muslim, chose not to wear the rainbow armband. He was not penalized for his actions, and he did not make top headlines. He simply was permitted to exercise his freedom of religion.

They can only force their ideals down our throats when it fits the WOKE narrative. They do not want England to remain a Christian nation and are hellbent on dividing the people into peculiar categories to encourage the divisive culture war.

Bitcoin & the END OF MONEY

December 6, 2024

Cryptocurrency bitcoin

QUESTION: Mr. Armstrong, I just had to write in to say thank you for explaining that Bitcoin was just a trading asset, not some new currency that would replace the dollar. I understand that money must be elastic to grow with society in economic booms and population. I just read a quote reported by Bloomberg: “After four years of political purgatory, Bitcoin and the entire digital-asset ecosystem are on the brink of entering the financial mainstream.” I know a programmer who said you were correct that the Deep State created blockchain. Has this recent rise been orchestrated to get us to surrender paper money and rejoice so they can track us all?

KS

 

ANSWER: I participated in a documentary that will be released soon. There is no question that the blockchain code was developed in the intelligence community. We all know that in the programming world. In 1996, the US government released a white paper entitled “How to make a mint: the cryptography of anonymous electronic cash.” Released by the National Security Agency Office of Information Security Research and Technology, this document basically explains how a government agency could create something like Bitcoin or another cryptocurrency. (SEE BELOW).

Has Bitcoin been manipulated more to make people think digital currencies are better than paper? There is a strong probability of that. This is clearly a dream of tyrants. If I give you $100 bill they do not know where I got it from. If I pay you in Bitcoin, they can trace it to everyone who has ever handled it. This is a control system. This is the END OF MONEY! A new documentary film will be coming out soon on this topic.

 

 

Here is  Lagarde on digital currency. She states this object is “control” everything you do. Europe is a Marxist Paradise. Everyone is an economic slave and whatever they earn belongs to the state – not them. The state will decide how much you are allowed to keep. I really do not understand these Bitcoin people if they deliberately try to convince us to surrender all liberty. With digital currency, they can block even a donation to a political opponent like Trump.

Euro Benefits 5 3 98

Even when creating the Euro, the commission took the entire back row of our conference held in London in 1997. I do not understand why it is so hard to comprehend what a currency is – but then again, some have trouble defining a woman. They were selling the Euro, which would defeat the dollar. That, too, never took place. They were preaching that everyone would pay the same interest rate as in the USA. I warned them that would only take place if they consolidated all the debts as Hamilton did following the American Revolution.

1 Kohl Dictator

Kohl took Germany into the Euro as a dictator because if the German people were allowed to vote, he admitted he would have lost 7 to 3. We do not live in a democracy. That is sheer propaganda. They make the decisions, and when they know the people will not accept that, even like war, they do it anyway. We mean nothing at the end of the day.

They sold Bitcoin as it would be free of central banks, a store of wealth, and eliminate inflation, all absolute total BS that was impossible in the real world. I have warned that this has been a fantastic sales job, and pushing the price up creates the image that it is somehow worth more than paper money, so surrender everything and go digital.

Standard Catalog if Depression scrip

People have been braindead when it comes to comprehending what money is and love to cling to stupid theories that will only lead to a major depression. They do not even understand that because the Fed was fearful of inflation during the Great Depression, to support the dollar, they failed to expand the money supply, fearing that the dollar would crash. Over 200 cities issued their own money because there was such a shortage of cash that businesses could not function. It was impossible to pay employees, and people had no cash to spend. This was called depression script.

M1 1915 1947

Whenever there is a recession or depression, people reduce their spending and hoard their wealth, contracting both spending and investment. This is a fact proven by the hoards of ancient Roman coins during the turmoil of the 3rd century. The money supply peaked in 1929 and contracted into 1933. This is why there was such a shortage of money that it led to over 200 cities issuing their own depression script just so they could function.

Tiberius TESSERA GERMANICUS III Panic 33AD

We find the very same human response during the financial Panic of 33AD. There was such a shortage of money so we find that private tokens appeared, similar to what took place during the American Civil War and the Great Depression of the 1930s.

 

Tiberius Tokens

The firm Seuthes and Son, of Alexandria, was a firm facing difficulties because of the loss of three richly laden ships in a Red Sea storm, followed by a fall in the value of ostrich feathers and ivory. Nearly at the same time, there was the house of Malchus and Co. of Tyre with branches at Antioch and Ephesus. They suddenly became bankrupt as a result of a strike among their Phoenician workmen and the embezzlement of a freedman manager. These two failures also affected the Roman banking house, Quintus Maximus and Lucious Vibo, operating in the Roman forum. We saw the same reaction: people hoarding their wealth, and the severe shortage of money led to the appearance of private coinage.

Civil War Private Token

You see the shortage of coinage during the American Civil War prompted a host of civil war tokens that circulated also as money. The same took place in Germany after World War I, and during the 1840s with the Sovereign Defaults of several US states that are known as the Hard Times Tokens.

Why Bitcoin Will NOT Replace the Dollar

Bitcoin can NEVER become the reserve currency for the entire political system, which must be changed, ending socialism. It would be impossible. All social programs would come to an end, and there would be massive deflation and civil unrest. The money supply always contracts during a recession and depression. We blame the central banks and the dollar when that is like blaming the gun for a murder rather than the guy who pulled the trigger.

1 ECM 2032 Wave 157 Pi Turning Point 1 Annotated

This is all about CONTROL. The computer has warned that between 2020 and 2032, we will witness the rise of authoritarianism. Governments are on the cusp of an international sovereign default. They are pushing for war as a distraction. The Digital ID and Digital Currency are no different from the paranoia of Joseph Stalin and his great purge to eliminate people he feared by revolting against him.

Stalin The Purge

Bitcoin is a trading vehicle as people buy into the propaganda. In the end, the truth always prevails.

Just do not expect it to become the reserve currency or stop inflation singlehandedly.

It’s a trading vehicle because people will buy because of the propaganda – just keep it real


HowtoMakeaMint2

In 1996, the US government released a white paper entitled, “How to make a mint: the cryptography of anonymous electronic cash.” Released by the National Security Agency Office of Information Security Research and Technology, this document basically explains how a government agency could create something like Bitcoin or another cryptocurrency.

I encourage those interested to read the contents of the link above. This document was released during the dawn of the dot.com bubble before the technology existed to create such a currency. The NSA quickly realized that it could weaponize this technology to create a cashless society.

As explained in the introduction:

“Among the most important uses of this technology is electronic commerce: performing financial transactions via electronic information exchanged over telecommunications lines. A key requirement for electronic commerce is the development of secure and efficient electronic payment systems. The need for security is highlighted by the rise of the Internet, which promises to be a leading medium for future electronic commerce.

Electronic payment systems come in many forms including digital checks, debit cards, credit cards, and stored value cards. The usual security features for such systems are privacy (protection from eavesdropping), authenticity (provides user identification and message integrity), and nonrepudiation (prevention of later denying having performed a transaction) .

The type of electronic payment system focused on in this paper is electronic cash. As the name implies, electronic cash is an attempt to construct an electronic payment system modelled after our paper cash system. Paper cash has such features as being: portable (easily carried), recognizable (as legal tender) hence readily acceptable, transferable (without involvement of the financial network), untraceable (no record of where money is spent), anonymous (no record of who spent the money) and has the ability to make "change." The designers of electronic cash focused on preserving the features of untraceability and anonymity. Thus, electronic cash is defined to be an electronic payment system that provides, in addition to the above security features, the properties of user anonymity and payment untraceability..

In general, electronic cash schemes achieve these security goals via digital signatures. They can be considered the digital analog to a handwritten signature. Digital signatures are based on public key cryptography. In such a cryptosystem, each user has a secret key and a public key. The secret key is used to create a digital signature and the public key is needed to verify the digital signature. To tell who has signed the information (also called the message), one must be certain one knows who owns a given public key. This is the problem of key management, and its solution requires some kind of authentication infrastructure. In addition, the system must have adequate network and physical security to safeguard the secrecy of the secret keys.”

Crypto.1996.1

The introduction goes on to discuss the reasons they could present to the public to switch to a cashless society, including money laundering, convenience, and security. “The term electronic commerce refers to any financial transaction involving the electronic transmission of information. The packets of information being transmitted are commonly called electronic tokens,” the paper continues.

The NSA states that it would like to use “user identification” and “message integrity” to protect privacy in “nonrepudiation” transactions. “Eavesdropping” concerns appear numerous times throughout the document, which could be prevented by “not just privacy but anonymity” in the form of “payer anonymity” and “payment untraceability.” The government clearly states that hard currency, cash, provided these luxuries but could not be traced by the banks and, therefore, the government.

Again, this was released in 1996 before basic online banking. The document outlines basic online banking but takes it a step further by explaining how they could seemingly make payments seem “untraceable” to the public using “blind signatures” that allegedly cannot be seen by the bank. “This step is called “blinding” the coin, and the random quantity is called the blinding factor. The Bank signs this random-looking text, and the user removes the blinding factor.”

PROTOCOL 3: Untraceable On-line electronic payment.

Withdrawal:

  •      Alice creates an electronic coin and blinds it.
  •      Alice sends the blinded coin to the Bank with a withdrawal request.
  •      Bank digitally signs the blinded coin.
  •      Bank sends the signed blinded coin to Alice and debits her account.
  •      Alice unblinds the signed coin.

Payment/Deposit:

  •      Alice gives Bob the coin.
  •      Bob contacts Bank and sends coin.
  •      Bank verifies the Bank’s digital signature.
  •      Bank verifies that coin has not already been spent.
  •      Bank enters coin in spent-coin database.
  •      Bank credits Bob’s account and informs Bob.
  •      Bob gives Alice the merchandise.

“This makes remote transactions using electronic cash totally anonymous: no one knows where Alice spends her money and who pays her.” Full “payment anonymity” would be “too much to ask”, thus, “we are forced to settle for payer anonymity.” In other words, the illusion that no one knows who is making the transaction.

PROTOCOL 5: Off-line cash.

Withdrawal:

  •      Alice creates an electronic coin, including identifying information.
  •      Alice blinds the coin.
  •      Alice sends the blinded coin to the Bank with a withdrawal request.
  •      Bank verifies that the identifying information is present.
  •      Bank digitally signs the blinded coin.
  •      Bank sends the signed blinded coin to Alice and debits her account.
  •      Alice unblinds the signed coin.

Payment:

  •      Alice gives Bob the coin.
  •      Bob verifies the Bank’s digital signature.
  •      Bob sends Alice a challenge.
  •      Alice sends Bob a response (revealing one piece of identifying info).
  •      Bob verifies the response.
  •      Bob gives Alice the merchandise.

Deposit:

  •      Bob sends coin, challenge, and response to the Bank.
  •      Bank verifies the Bank’s digital signature.
  •      Bank verifies that coin has not already been spent.
  •      Bank enters coin, challenge, and response in spent-coin database.
  •      Bank credits Bob’s account.

Note that, in this protocol, Bob must verify the Bank’s signature before giving Alice the merchandise. In this way, Bob can be sure that either he will be paid or he will learn Alice’s identity as a multiple spender.

The government begins to explain basic blockchain concepts, or at least how they’d like them to occur.

“When Alice spends her coins with Bob, his challenge to her is a string of K random bits. For each bit, Alice sends the appropriate piece of the corresponding pair. For example, if the bit string starts 0110. . ., then Alice sends the first piece of the first pair, the second piece of the second pair, the second piece of the third pair, the first piece of the fourth pair, etc. When Bob deposits the coin at the Bank, he sends on these K pieces.

If Alice re-spends her coin, she is challenged a second time. Since each challenge is a random bit string, the new challenge is bound to disagree with the old one in at least one bit. Thus Alice will have to reveal the other piece of the corresponding pair. When the Bank receives the coin a second time, it takes the two pieces and combines them to reveal Alice's identity…

Zero-Knowledge Proofs. The term zero-knowledge proof refers to any protocol in public-key cryptography that proves knowledge of some quantity without revealing it (or making it any easier to find it). In this case, Alice creates a key pair such that the secret key points to her identity. (This is done in such a way the Bank can check via the public key that the secret key in fact reveals her identity, despite the blinding.) In the payment protocol, she gives Bob the public key as part of the electronic coin. She then proves to Bob via a zero-knowledge proof that she possesses the corresponding secret key. If she responds to two distinct challenges, the identifying information can be put together to reveal the secret key and so her identity.”

The document then discusses ways to blind the signature, so that the payee may remain anonymous. Now, why would the government allow that to occur? “Even in anonymous, untraceable payment schemes, the identity of the multiple-spender can be revealed when the abuse is detected. Detection after the fact may be enough to discourage multiple spending in most cases, but it will not solve the problem. If someone were able to obtain an account under a false identity, or were willing to disappear after re-spending a large sum of money, they could successfully cheat the system.”

Crypto.1996.2

The document even discusses what we now would refer to as a crypto wallet. A seemingly safe offline method to store these electronic coins. They explain that at least one party must always reveal their hand. “When a coin is spent, the spender uses his secret to create a valid response to a challenge from the payee. The payee will verify the response before accepting the payment. In Brands’ scheme with wallet observers, this user secret is shared between the user and his observer. The combined secret is a modular sum of the two shares, so one share of the secret reveals no information about the combined secret.”

Crypto.1996.3

Who is the “observer” in this scenario? “An observer could also be used to trace the user’s transactions at a later time, since it can keep a record of all transactions in which it participates. However, this requires that the Bank (or whoever is doing the tracing) must be able to obtain the observer and analyze it. Also, not all types of observers can be used to trace transactions.”

In the event that a transaction was compromised, the bank would have to change its secret key and “INVALIDATE ALL COINS.”

The authors explain that tax evasion, per usual, is the key concern. They mention money laundering and “old crimes such as kidnapping and blackmail” as reasons to allow backdoor entry. Restoring traceability was a proposed solution, and if they could restore traceability in the first place, one must question if the payments were ever truly anonymous. Using Alice as their example, they explain that they could simply issue a warrant and track all her payment history. “Back~ard traceability is the ability to identify a withdrawal record (and hence the payer), given a deposit record (and hence the identity of the payee). Backward tracing will reveal who Alice has been receiving payments from.”

So, while the bank only sees the deposit in encrypted form, the public key must be used for withdrawal. “The ability to trace transactions in either direction can help law enforcement officials catch tax evaders and money launderers by revealing who has paid or has been paid by the suspected criminal. Electronic blackmailers can be caught because the deposit numbers of the victim’s ill-gotten coins could be decrypted, identifying the blackmailer when the money is deposited.”

“In conclusion, the potential risks in electronic commerce are magnified when anonymity is present. Anonymity creates the potential for large sums of counterfeit money to go undetected by preventing the identification of forged coins. Anonymity also provides an avenue for laundering money and evading taxes that is difficult to combat without resorting to escrow mechanisms. Anonymity can be provided at varying levels, but increasing the level of anonymity also increases the potential damages. It is necessary to weigh the need for anonymity with these concerns. It may well be concluded that these problems are best avoided by using a secure electronic payment system that provides privacy, but not anonymity.”

The US government released this document in 1996, 27 years ago. Bitcoin was allegedly anonymously created in 2009, and numerous other blockchain-based payment coins have followed. This, paired with the push for CBDC, where the government simply does not need to pretend payments are anonymous, should make one question the security and longevity of cryptocurrencies.

Page 79 of 1056