Does #Bitcoin have a long-term future?
(long thread, 1/24)

I thought I might as well air some worries, which might be common but unarticulated among crypto newbies like me.

These worries center around BTC's medium-term vulnerability to propaganda attacks & psyop hacks...

2. I accept that bitcoin is technically brilliant, politically visionary, globally empowering, maybe the future of money, etc etc. Hopefully we'll use something like BTC when we colonize the galaxy, long term.

And BTC might still be a good investment short term.

However...

3. Insofar as crypto threatens US dollar hegemony as a global reserve currency, the higher BTC's market capitalization gets, & the more of a legit threat it becomes, the more incentive US and US-affiliated gov'ts have to try to crush it.

What will they do?

4. Govt's could try to crush bitcoin in ways that 'play nice' using legal means -- regulating it, taxing it, imposing capital controls, etc. If that doesn't work, they could escalate by banning banks, pensions, corporations, and individuals from trading it or holding it.

Or...

5. Govt's could play dirty. They could crush bitcoin with propaganda attacks & psyops rather than regulation. Propaganda is often much cheaper, faster, & often more effective than legal regulation/coercion. It seems like any number of psyops could easily destroy demand for BTC...

Thoughts on #bitcoin price here in a thread

TL;DR: $BTC is caught between a tug of war of market manipulation by #tether, pushing price on low volume on one hand and undeniable fundamental asset price inflation driven by the Fed’s printing on the other.

1/ $BTC is up 22% in 5 days on ever falling, low volume in holiday trading. During this time it has defied every sensible signal. Leveraged funding is unsustainably high, futures are as far in contango as I can remember.

2/ #tether has printed $400m during the holidays, implying that either huge (and I mean HUGE) institutional investors have wired real Dollars over the period when they aren’t in the office or, as we all know it to be true: they are printing freely out of thin air.

3/ With these $USDT and the help of all the connected #tether exchanges price has been painted upwards without resistance. The manipulation, to any experienced market participant, is so obvious it hurts.

4/ However, it is absolutely true that #bitcoin, along with every other asset in the world is acting as a vacuum for the central bank liquidity unleashed on markets. It is just as ridiculous to deny this perfectly legitimate effect as to say #tether is not manipulating prices

I often hear the argument: Bitcoin mining is wasting enormous amounts of energy.

Bitcoin mining uses about the same amount of energy as a small country and that is fine!

Time for a thread:

To start, energy consumption in general is not a bad thing. Without it, civilization as we know it would simply not be possible.

If we would monetize your manual labor by putting you on a rowing machine you would have produce approximately $0.30 of value per day.

Energy grids are in nature in efficient. It is impossible to tranport electrical energy over long distances. Because of this approximately 6% of the US energy production is wasted because of losses alone. Just about 3.5X the total energy consumption of the Bitcoin network!

Varying load, seasonal or daily, poses challenges to the grid and the producers. It is for example not always possible or easy to lower supply to match demand.

This brings the need for balancing the network. Without it, the grid will become unstable.

With the increase of renewable energy, the need for load balancing solutions will continue to grow:

Solar energy only creates energy when the sun shines. Wind energy only creates energy when the wind blows.

Dear #Bitcoin & crypto tribe,

Here are some lessons from @arrington on @nakamoto which are particularly timely and poignant for we continue our good fight for crypto adoption in 2021.

This is just the beginning.

We (the Innovators and Early Adopters) laying the groundwork for the revolution probably aren't even aware of how big our ideas get.

Crypto Winter is over. Spring is coming.

/2

What is our fight?

Fiat = misery and quiet thieft via inflation
Bitcoin and crypto = freedom and happiness

This is the fight. Right now, this sounds insane to 99% of people.

/3

We can go on and on about #bitcoin and crypto and we should! But just like the Internet in 1995, remember that it will take years for smart people to the power of crypto currencies and we need to help them along the way.

/4

The way we as a "crypto community" discuss crypto on Twitter today drive away newcomers. They flee as fast as they can because of the hate, nastiness and intolerance we spread among ourselves. This is NOT ok and cannot continue.

/5

I've received many questions lately, but by far the most common question is “What's the best way to secure #Bittcoin?”

🧵So here’s a thread with my opinion on securing #Bitcoin

The first thing to understand is that there’s no "best way", but always a tradeoff.

You can always find ways to make it harder for someone to get your #Bitcoin, but if you over-complicate it, you could end up making it even too hard for yourself - many lost their funds this way.

Your goal should be to balance usability and security the way which works best for you.

This means very different things for different people, depending on your technical experience, understanding of Bitcoin, how much you are holding, etc.

For some, that means leaving Bitcoin on an exchange.

I strongly recommend at least learn to hold your own keys before buying, but if you can’t wait, it’s better to leave it there than holding yourself if that’d make you feel like you have no clue what’s going on.

If you feel ready to take self-custody, you could start with a hot wallet on mobile or desktop. That’s a good step forward, as it means you’re holding your own keys. But this introduces some more new concepts you should get familiar with.

Scathing comments on Crypto from Mr Rabi Shankar - Deputy Governor, RBI.

1) On crypto being treated as a currency:
"Currency always has an issuer, usually a trusted entity like the sovereign. Even when gold is used as a currency, the gold coins had to be issued by a sovereign.

Secondly, historically, a currency has always been either a commodity with intrinsic value or a debt instrument. Cryptocurrencies do not conform
to this understanding as they do not have an issuer, they are not an instrument of debt/commodities nor do have any intrinsic value.

Currency needs trust, not everything that can be trusted is a currency. So even if technology (as
in a blockchain) provides the trust for cryptocurrencies, they can at best perform the role of a currency within the private and closed environment of that cryptocurrency.

They do not, and should not, automatically become a currency for the larger society "

2) On crypto being treated as a financial asset : "This is also problematic because all financial assets have underlying cash flows and need to be some person’s liability.

0/ It's been a big 2 weeks for $BTC as it hits a new ATH, $MSTR completes a $650M convert, Mass Mutual invests $100M, Ruffer Management buys $745M, Jeffries recommends a 5% allocation, Guggenheim's CIO gives a $400K PT, OneRiver, FinCen rules better than feared & Coinbase S1

1/ $MSTR completed a $650M convertible bond offering at 0.75% with the intent to purchase $BTC (and per @michael_saylor) it looks like they completed that buy. Since first announcing their $BTC purchase in mid-August the stocks +143% (with BTC over 2.0x during that time)

2/ Mass Mutual with its ~$235B general investment account purchased $100M of $BTC through NYDIG (after making an equity investment alongside @BessemerVP & $MS).

3/ Ruffer Management a ~$27B asset manager bought $750M of $BTC to equate to ~2.5% of the portfolio:

"We see this BTC investment as a small but potent insurance policy against the continuing devaluation of the world’s major currencies,”

4/ Jefferies Christopher Wood amended his long-only asset allocation recommendation for pension funds cutting gold to 45% from 50% and initiating a 5% position in $BTC.

Read the SEC Complaint against Ripple. It’s bad for XRP and for all crypto, except BTC. It’s bad for XRP because it alleges all XRP are *at this very moment* securities in the US, not just the XRP Ripple allegedly bundled into an investment contract. 1/n

Ironically, that would mean XRP can’t be used by anyone for any purpose *other than* speculation on Ripple’s success in the US. Go figure. The XRPL is a fully functioning network. I’ve used it to send value between exchanges to cash out in AUD through an ODL exchange partner. 2/n

It takes all of 30 seconds for the money to arrive in my bank account. It is a wondrous experience. At no time did I think I was purchasing a speculative investment product. Yet the SEC alleges that is exactly what I did. 3/n

To the SEC, all holders and sellers of XRP are holding and selling an investment contract issued by Ripple. This shows how useless their previous guidance has been. Here, a digital asset on a fully mature network is a security for everyone because… well, just because… 4/n

This case probably can’t settle. If XRP is a security it can’t comply with security laws *and* be used for any purpose by anybody except for speculative financial gain at the hands of the company that can’t use it to generate value for anybody because its a security. Nuts. 5/n

You may have landed here via a billboard in your community

The goal of this project is to bring Bitcoin awareness to those who can benefit most - avg citizens, not Wall St

Follow to learn about #Bitcoin and why it's better than endless money printing and stimulus check hopes

There are a dozen billboards - one in every Federal Reserve bank city and each w/ a unique message

These banks exist to “provide stable monetary policy and a safe and flexible financial system,” but it’s not working

The billboard art and messages will explain why

While waiting for photos of the billboards to surface, let’s talk about what exactly is Bitcoin (BTC)

Maybe you heard about it in the news recently b/c the price has gone up. You might feel late to the game, but you’re not

It’s early and Bitcoin is here to stay

One of the most interesting things about it is that it can’t go away

It’s decentralized, meaning no person or government can control it. That’s a good thing because money is used to control people

You can send BTC to someone (peer-to-peer) w/out needing permission or a bank

When you send or receive BTC, a decentralized network of computers (nodes) works together to confirm the transaction is legit

#Bitcoin has never taken any money from anybody. Every person in the world that bought #BTC and did not sell or lose it has made money. I mean hard money too. The only ones that lost either sold it or lost it. What’s the lesson?

The simple answer is #HODL don’t sell and secure it, but not many have done that #. Why? Here is what I learnt from being involved in #Bitcoin for over a decade.

1. You need to overcome the emotions of fear and greed which is hard wired into the human psychology. Not so easy.

2. You need to resist the urge to trade when everybody is telling you #Bitcoin is going to be killed by another competitor or it’s a scam or it’s a Ponzi scheme or it’s just for drug dealers or it’s a dinosaur compared to other crypto or it’s going to get banned or etc. etc. etc.

3. You need to learn how to become your own bank that requires learning a new skill that became easier over time, but was very hard in the early days. Securing your own wealth without a bank gives you freedom, but new problems to solve.

1/10 A rough prediction using the #Bitcoin Price Temperature (BPT) Bands:

If the current #Bitcoin post-halving bull run has a similar growth & volatility as the last one, this cycle could top at around $300k in October 2021 👀

Q&A with interpretation & nuances in this thread 👇

I should be clear here. Yes, we've made fortunes on BTC. But BTC was coopted years ago. Now the CIA/deep state/Wall St people are getting into it because it has gotten the nod from the Rothschilds. At some point we will all sell for Monero and they are all fucked. ;)

It'll be somewhere around $300k that we bring the hammer down on them.

Bitcoin has no role in institutional or retail investors portfolios. It is not a currency: not an unit of account, not a scalable means of payment & is a highly volatile store of value. It is heavily manipulated: look at the investigation of  Bitfinex by US law enforcement. 1/n

See also the academic evidence that Tether is used to manipulate the Bitcoin market. And look at the recent indictment of BitMex and his criminal CEO & gang. It has no intrinsic value, it is not backed by any asset, it is not legal tender, it cannot be used to pay taxes. 2/n

Almost no merchant uses Bitcoin as its price volatility leads to market risk that any profit margin is wiped out before u can convert it back into fiat. Not scalable means of payments. It's toxic for the environment as POS hogs enormous amounts of energy & pollutes the earth. 3/n

Bitcoin is not an asset as it has ZERO intrinsic value. Assets do either provide an income or capital gains or utility or real use of some sort. Stocks, bonds, real estate, other assets provide both income (dividends, interest, rent) & capital gains & housing services for RE; 4/n

Gold/silver dont provide income but give capital gains, utility (jewelry) & used in industry.  BTC doesn't give income, has no other utility services (such as unit of account or means of payments) & provides only capital gains (or losses) based purely on speculative motives. 5/n

For the sake of a public record, I would like to lay out my prediction for how this next #Bitcoin #BTC #Crypto bull market plays out...

@RaoulGMI @PrestonPysh @AriDavidPaul

Bitcoin will top out somewhere between $200k and $300k.

I am not of the belief that this is going to be the "final cycle" where BTC soaks up the world's wealth, goes to $1 million and rewrites financial history. I do not think...

That Bitcoin is headed permanently to the moon on this go round. After this cycle peaks I would expect a 60 to 80% retrace.

The macro narrative is taking shape that BTC is a hedge against inflation, however...

I don't think we're actually going to get the inflation everyone expects.

In order to get secular, painful, obvious inflation I think that several things need to happen. We need a more accommodating government (MMT) which we don't...

Have yet, as evidenced by Mitch blocking the $2k stimulus.

At this point we don't have the system necessary to fire the fiscal bazookas fast enough to overcome the forces of deflation.

I think that we'll get a MMT government eventually, but it could take several years...

20,000 friends in 2020.

20 lessons to do better.

1) Be part of a like-minded group. Applaud different views. Welcome different skills. Build a team mission.

2) Debate. Don’t argue. Share views, opinions. Eliminate heated environments. Agree to disagree, move on.

3) Numbers can’t change you. Cash. Follower count. Assets. Keep your feet on the ground. It can all disappear quickly.

4) If you can’t help for free, you don’t deserve paid work. Help, without expectations. Every action is experience. It somehow pays off.

1/ We often misunderstand new technologies because they don’t neatly fit into to our world…yet

They enable us to do things we previously couldn't.
They change our behaviour.

#Bitcoin is one such example.

And looking at how it’s currently used gives us a peek into our future.

2/ INFLATION HEDGE:

"Bitcoin’s ultra-orthodox monetary policy of targeting a fixed money supply, is the ideal hedge for fiat money printing."
- @pierre_rochard

3/ MONETIZATION OF STRANDED ENERGY:

“If your local energy cost is effectively zero but you cannot sell your energy anywhere, the existence of a global buyer for energy is a godsend.”
- @nic__carter

4/ UNCORRELATED ALPHA:

"One reason the interest in #bitcoin from Wall St as well as pensions and endowments is this is uncorrelated alpha, this is the holy grail of investing.”
- @Sonnenshein

5/ MICROPAYMENTS:

"Bitcoin uniquely has a native unit of account called a "sat" that currently represents 1/100 of a cent (while BTC is $10k). The brand of "sats" ...could already be the most recognizable global unit of account to represent value <1cent."
- @cuysheffield