Katie The Russian, CEO of Plan B Passport and co-host of the “The Bittersweet Podcast,” has written an opinion piece on the topic of travel insurance.
It’s impossible to make meaningful choices because you are born into a nonconsensual monopoly imposed on you by the government. You don’t have a choice about what services you want to receive or how much tax you’re willing to pay for them.
Unless, of course, you opt to play the game of jurisdictional arbitrage and reduce your reliance on any one particular state.
You may wonder, “What is jurisdictional arbitrage?” Taking advantage of the regulatory discrepancies across legal jurisdictions is commonly referred to as a form of arbitrage. As the old phrase goes, “Everything that is not forbidden is permitted,” so to speak. In many ways, jurisdictional arbitrage is based on this principle. There are various jurisdictions where the rules of the game can be learned, so you can pick the one that best suits your needs and then figure out how to best apply it to your situation.
There are a number of ways to ensure your food is of the finest quality, such as purchasing it from a local farmer’s market, purchasing it from a nearby Whole Foods store and having it delivered to your door. Similarly, you shop for jurisdictions based on your objectives.
It’s a problem for governments, and they strive to stop it in any way possible. “This practice of charging far more than government services are actually worth developed through decades of monopoly,” says “The Sovereign Individual,” one of my favorite books.
In this context, what does it mean to have a “monopoly”?
This is where we are right now: only roughly 3.6% of people are currently living outside of their place of birth. Taking this into account from the perspective of the market, this indicates that only 3.6% of individuals have opted for a “competitor” jurisdiction, resulting in these governments’ effective monopolies, which control 96% of the market.
Competition evolves when a strong competitor enters the market with an easy-to-use mechanism to facilitate a “trade.”
This is why I’ve spent the last five years focused on “investment migration,” the word we use in the jurisdictional arbitrage sector to characterize the immigration schemes that use investment or gift as a foundation for obtaining a visa, residency, or passport.
The price race to the bottom and the quality race to the top will drive the free market of competition between jurisdictions once it is created in any capitalistic context.
In other words, what exactly is the term “Jurisdictional Arbitrage?”
Let’s clear up some misconceptions regarding this term that I’ve been using a lot recently.
Although jurisdictional arbitrage has been around for some time, it’s no longer exclusive to the wealthy. That was the case for a long time, though, until about a decade ago.
- Reducing the tax burden (or no capital gains taxes)
- Making the world a more secure place (FU passports)
- Obtaining liberation
- enhancing quality of life and fostering a sense of belonging (e.g., moving to Austin or Nashville)
- Creating a new set of memories (e.g., moving to a surf town)
- Improved living costs
- creates a more favorable regulatory climate for innovation
- Creating a stable political climate
- What kind of flags should I use? If you have a specific objective, need, and current flags, the jurisdictions that best suit you need to be tailored to suit you, not the other way around.
As with many other fields, the study of flags has seen many shifts over time. Changing geopolitics, rules, developing cultures, and one’s own interests can lead to a shift in the ideal jurisdictions.
The term “Three Flag Theory” was first used to describe the notion, which eventually evolved into “Five Flags” and then “Seven Flags.” In contrast to previous industry players, I believe that the number of flags now required is substantially smaller thanks to Bitcoin.
Many of the previous flags have been replaced by the new flag of cyberspace, which is possibly the most important of all of them. You may protect your assets with SHA-256 and make expatriation more appealing by reducing the complexity of your flag strategy.
Second in a series of articles inspired by governments’ restrictions on citizens and the need for Bitcoiners to find sovereignty through free, worldwide travel. A look at how Bitcoiners build their flag strategy is coming up next in this series.
Katie The Russian is a guest blogger. There is no affiliation between BTC Inc. or Bitcoin Magazine and the views stated here.