One of the problems that the Bitcoin phenomenon has presented has been a function beyond the dark web. Some has suggested it has a role providing a transaction network for the Unbanked. This has been unconvincing for two reasons. First, the Unbanked are also ‘un-wealthy’. Second, idea that consumers have easy access to the web but are Unbanked makes little sense. The functional role of Bitcoin thus seems to be the dark web. The speculative role of course is open to all and self-evident from the price fluctuations but this blog is concerned with Bitcoin as a means of exchange.
There does seem to be a legitimate role in what might be termed the grey web. There are many commercial activities that are locally legal but globally problematic. Recreational marijuana is legal in Uruguay (for locals not tourists) though oddly medical marijuana is not legal (go figure). The same is true in some US states and around the world there are local variations in degrees of illegality. Those providing the M need banking facilities and many banks, which invariably have a global perspective, feel uncomfortable providing such facilities. The source of the problem is the hegemony of US federal law in global banking and the illegality of M in US federal law. It is dangerous for any bank to provide facilities to locally legal M trading if it is ever to have dealings with the dominant US banking system.
The global hegemony of US federal law appears in other spheres also. Politically motivated sanctions also create problems for banks and other commercial operations. If the US imposes politically motivated sanctions on a country, the dominance of US banking and economic activity forces it on all even if a sovereign country disagrees with this decision. In effect this country is cut off not only from commercial activity in the US but also from global corporations which have commercial relations with the US. This is basically every significant corporation. So ignoring US politically motivated sanctions can be expensive and sometimes dangerous. The result is that locals find themselves bound by US federal law even though local law does not have any sanction. Enter Bitcoin.
Bitcoin provides a currency for this grey web, locally legal commercial activity falling foul of US federal law. The Bitcoin monetary system provides a framework for money based trade that is independent of banks and thus can facilitate trade that cannot use banks. To be fully effective it does have to expand beyond the items prohibited by US federal law so that traders can do business more widely. This seems to be happening with more and more globally legal commercial transactions possible in Bitcoin. So this answers my own question; which legal commercial transactions do Bitcoin, and only Bitcoin, make possible? Bitcoin has a function and it is created by the hegemony of US federal law. This is a very powerful impetus which I had previously not grasped. Mea culpA.
Ironically, the weakness in the Bitcoin monetary system is the limited supply. This gifts a dramatic seigniorage to those holding Bitcoin and is creating a volatile bubble condition in the early stages of development as a grey web monetary system. As long as it is merely an exchange rate this will be a problem. The Bitcoin price of M is rising rapidly and is quite volatile and this is important because the users are paid in USD etc. When everyone is paid in Bitcoin this is less of an issue. Nevertheless, Bitcoin has a future as money as long as the US (or any other hegemonic power) tries to impose its will on global activity and indeed on states within its own Union.