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Dennis Porter suggests alternative student loan forgiveness program using Bitcoin Dennis Porter suggests alternative student loan forgiveness program using Bitcoin

Dennis Porter suggests alternative student loan forgiveness program using Bitcoin

Former political advisor Dennis Porter wants to wipe out student debt using time-locked smart contracts holding Bitcoin.

Dennis Porter suggests alternative student loan forgiveness program using Bitcoin

Cover art/illustration via CryptoSlate

Satoshi Action Fund CEO Dennis Porter proposed a radical alternative to President Biden’s student debt forgiveness plan.

The former political advisor suggested the U.S. government give every indebted individual $10,000 in BTC locked in a smart contract. By the end of the lock-in period, Porter assumes the dollar equivalent value would be more than enough to repay the loan balance.

Aside from the improbability of this happening, the crypto community also chimed in with feedback on Porter’s idea.

The Biden administration comes under fire

U.S. student debt, consisting of federal and private loans, totals $1.75 trillion. Data showed the issue impacts 45 million Americans — about one in seven.

On August 24, the White House announced a student loan relief package canceling $10,000 in debt for those earning less than $125,000 per year. While low-income families who had received the Pell Grants qualify for $20,000 of debt forgiveness.

President Biden said the relief measures would help Americans cope with debt management, and the knock-on effects will see tangible economic benefits.

“To finally think about buying a home or starting a family or starting a business. And by the way, when this happens, the whole economy is better off.”

On the whole, mainstream media has spun the story into a positive event. For example, the Financial Times dismissed inflation risk, calling the relief program “an economic nothing burger.” Meanwhile, Reuters suggested it could lead to price deflation.

However, critics raise several issues with the program. Chairman of the Republican Party of Texas, Matt Rinaldi, pointed out that the money has to come from somewhere, and it will be “truck drivers and plumbers” footing the bill.

Similarly, political commentator Ben Shapiro chimed in to voice a message of personal responsibility and, much like Rinaldi, blasted the idea of collectively bailing out those who acted financially irresponsibly.

Bitcoin to the rescue(?)

Adding fire to the already politically charged debate, Porter suggested the $10,000 due to qualifying persons could be used to buy Bitcoin, which is then locked in a smart contract that enables access after ten years.

Upon the lapse of the lock-in period, the funds would be used to pay down the balance of the individual’s student debt.

Commenting on Porter’s idea, @DavidShares called it a “horrible take” in that this would require the U.S. government to custody BTC.

Based on the concept of Bitcoin maximalists supporting only self-custodial spot BTC, others questioned the use of smart contracts and even whether Bitcoin supports such functionality.

Porter pointed out that smart contracts are “the centerpiece” of the Lightning Network, including a link to documentation on Hash Time-Locked Contracts.

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