Ch 11.4 - Crypto
"Some people say gold is a barbarous relic. I prefer gold, but something about crypto has them uncomfortable." - Unknown
Narrative: Crypto is used by money launderers, drug traffickers, and criminals to hide their finances from their illegal activities. It should be regulated and taxed the same way bank deposits are.
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a. History
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"I don’t believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can’t take it violently out of the hands of government, all we can do is by some sly roundabout way introduce something that they can’t stop." - Frederick Hayek
"The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” - Satoshi Nakamoto
"In Japanese language: Satoshi = Intelligence/wisdom + Naka = Central/center + Moto = Origin —> So the "mystery" origin of Bitcoin is LITERALLY stated right to our faces in the name of the secret creator 'Satoshi Nakamoto'... it translates 'Origin Central Intelligence' (CIA)" - Unknown, *Satoshi* (さとし) is a common Japanese given name, often meaning "wise" or "clear-thinking." / *Nakamoto* (中本) is a common Japanese surname, with "naka" (中) meaning "middle" or "center," / "moto" (本) meaning "origin" or "foundation."
"The market cap for Bitcoin today is around $814 billion. The market cap for all the mined gold in the world, which took thousands of years to accumulate, is about $13.7 trillion. That means Bitcoin has a market cap roughly equal to 6% of gold’s. Assuming gold stays flat and Bitcoin goes up about 16x, it would have a market cap roughly equal to gold. At that point, a single Bitcoin would be worth over $660,000." - Doug Casey
"They finally revealed the real Satoshi Nakamoto. Turns out, it’s Len Sassaman." - Unknown
b. Pro-Bitcoin Arguments
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"The US government has been clear that it views Bitcoin—and only Bitcoin—as a commodity under the purview of the Commodity Futures Trading Commission (CFTC) and the Commodity Exchange Act. Bitcoin is a commodity because it is an asset without an issuer... Similarly, gold, silver, copper, wheat, corn, and other commodities have producers, but they do not have issuers... Just as copper or nickel has no marketing department or founder. The SEC couldn’t go after Bitcoin even if it wanted to because there’s nobody to go after. There’s no Bitcoin headquarters. Bitcoin has no CEO, no marketing department, and no employees." - Doug Casey
"Whenever you see volatility in the Bitcoin price, ask yourself two things:
1) Does Bitcoin still have superior monetary properties (total resistance to debasement and extreme portability)?
2) Is Bitcoin still unstoppable?
If the answer to those two questions is 'Yes' I would not be worried." - Unknown
"It’s essential first to clarify that while the Bitcoin price is volatile, the Bitcoin protocol is the most stable, predictable, and reliable thing I know of in finance... Ever since Bitcoin’s inception in 2009, the 21 million total supply has not changed, the network has never stopped, miners have continued to create a new block every 10 minutes on average, and anyone has always been able to use Bitcoin to send value to anyone, anywhere, without needing a third party." - Doug Casey
“Take all you money. Buy Bitcoin. Then take all your time [and] figure out how to borrow money to buy more Bitcoin. And then take all your time and figure out what you can sell to buy Bitcoin. And if you absolutely love the thing and don’t want to sell it go mortgage your house and buy Bitcoin with it.” - Michael Saylor
"You can cling to gold, but it’s like clinging to your Kodak stock because you like photos instead of buying Apple. Or like Rand McNally maps compared to Google Maps." - Michael Saylor
“#Gold is better than #bitcoin because it's physical, I can hold it in my hand. Newspapers are better than @X because it's physical, I can hold it in my hand.
Wal-Mart is better than Amazon because it's physical, I can walk in and shop.
CD's are better than MP3's because it's physical, I can hold it in my hand.
[Paper pictures are better than digital pictures; I can hold them in my hand.]
Blockbuster is better than Netflix because it lets you borrow physical DVDs, which I can hold in my hand.
Sending a handwritten letter is better than e-mail because it's physical and can be held in your hand.
It's abundantly clear that digitizing physical mediums of communication and commerce has NEVER worked. Why do you think #bitcoin will?” -PastorCoin. Kodak went bankrupt, believing people wouldn't want digital photos.
"Return of a version of "The Delirium of the Milliards":
- 1924 Berlin was expensive for Germans but very cheap for Americans with their (gold-backed) USDs.
- 2024 America is expensive for Americans but very cheap for Bitcoiners." - Unknown
"Bitcoin is an organism that lives off electricity subsidies." - Tom Luongo
c. Anti-Bitcoin Arguments
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"Shields are made with metal. I can't hold bitcoin." - Unknown
"Bitcoin fixes this. Hardest money ever. Cannot be debased by politicians, or anybody, programmatic supply, fixed supply, no counterparty risk, final settlement, in less than an hour, base money." - Unknown
"Money so hard, it's not even there." - Unknown, on the downside of owning bitcoin
"What I found fairly interesting was the author's segue into 'abstraction' and it's dangers. Well, just WTF is Bitcoin, if not an 'abstraction'? I mean you are carrying around an Iphone with a software wallet into which you enter a code(s). That brings up a screen that tells you how many digits you have that are called Bitcoin. The Bitcoin themselves are digits created through some sort of complex math problem that another computer is utilized to solve while using vast amounts of electricity, which is cited as the 'intrinsic' value along with the scarcity component because only 21 million can be produced. No mention of whether another Bitcoin model, say version 2 or 3 or 4, also limited to 21 million would somehow take the shine off of BTC1? " - Unknown, on Webb's great taking book and how Bitcoin can be used as a safe way to store your savings
"Crypto is a solution to a problem that does not exist. Putting these things on a public blockchain doesn’t actually solve anything. The existing system is quite robust. The tokens have no fundamental or intrinsic value. The only real use case is sanctions evasion and money laundering (monero and pirate chain)." - Unknown
"Bitcoin has zero impact on our economy, our economy impacts bitcoin but not the other way around. Bitcoin could disappear tomorrow and the only thing that would change is you wouldn't have to read these bullsh1t shill articles any more.. That would be the only notable difference in your day to day life." - Unknown
"money doesn't go into or out of bitcoin. it is a zero sum Ponzi scheme. its 'price' is just a measure of how much wealth one wants to transfer to another person already playing in the game. when no one wants to play anymore its price will be zero. and you can't hang it on your wall, or feed your dog with it, or put it in a vase. it is the largest most extraordinary game of financial chicken the world has ever seen. the idea that there always will be a price greater than zero because it somehow has some intrinsic value is just wrong. so when the price of bitcoin goes to zero there will be no tidal wave of money coming out. it will just be a recognition that the wealth transfer is over and the folks holding the bag have nothing and it will not affect those already out of the game in the least. they will have already won. of course all the people playing the game or trying to be compensated for facilitating the game will create any sort of mechanism to promote the game. but that misses the point. the fundamental transaction is a transfer of wealth from someone not in the game to someone that is. all that transaction does is transfer some amount of real wealth from a non-player to a player so that the non-player is now a player and the previous player is out of the game. how much wealth was transferred to play is the price." - Unknown
"Bitcoin appears to be a decentralized Ponzi scheme not a decentralized currency. People don’t spend it because they want it to go up. The dollar works because of inflation. It keeps velocity up like hot potato. If you want to store value: silver, gold, and land. Because it’s beautiful useful and valuable. Bitcoin is a Ponzi scheme without an individual attached to it to go to prison. So the media can control swings for profit. That’s my opinion about bitcoin. The purpose isn’t currency the purpose is to make dollars. The dollars 'weakness' is actually why it won’t be replaced. Velocity" - Owen Benjamin
"The crypto fools could just as easily buy asset backed cryptos. But they don’t. Instead, they choose cryptos backed by nothing. Why? Because asset backed cryptos are tethered to reality by the underlying asset. They can’t get rich buying asset backed cryptos because no real asset is going to 10X in a month. They choose to buy cryptos backed by nothing because they want to get rich. And how do they get rich? By selling to a greater fool. The crypto fools are 9 years early for the Klaus Schwab party… they own nothing and they’re happy." - Unknown
“It's like blogging your banking details. All the blockchains are public." - Francis Hunt, Market Sniper
"If I give you $100 they have no idea where it came from. If I give you .01 Bitcoin they know where you got it from and the 10 people before you." - Unknown
"Bitcoin is superior to gold at skyrocketing and crashing." - Keith Weiner
"The entire f'ing bitcoin usage aspect is what's so utterly f'ing stupid. It's so f'ing complicated to even transfer and use bitcoin for the average person. Most people would rather use Apple Pay etc. Most people don't give a f'k about anything else except convenience and right now it's really f'ing inconvenient to use bitcoin for anything but to show off." - Unknown
"I've always been deeply opposed to crypto, Bitcoin, etc. The true use case for it is criminals, drug traffickers, anti-money laundering, tax avoidance. And that is a use case." - Jamie Dimon, CEO of JP Morgan hitting all the key buzzwords for the government to ban/regulate crypto out of existence. Remember, the government hates competition.
"Warren (fake Indian) might want to take a hard look at art sales. When rich guys drop $5 mil for a 'painting' that an average 5 yr old could paint, there is something going on and it is not a love of art." - Unknown, on why crypto is not the ideal way to launder money
"Requiring non-custodial open-source software to perform bank-like compliance is *the big attack* bitcoin’s enemies have always threatened. it’s impossible for bitcoin core, for example, to comply with this, so it amounts to an effective ban of bitcoin in the USA. These rules effectively ban crypto in america, and they fundamentally undermine the core innovation itself — P2P digital cash. if you believe humans should have the right to transact without an intermediary, you must oppose this bill." - Unknown
"We've always expected them to ban Bitcoin. We don't care.
- First they ignore you,
- Then they laugh at you,
- Then they fight you <--- we are here
- Then you win" - Unknown, on Elizabeth Warren introducing a bill that effectively bans crypto in the US
"If you don't think the government, who owns the internet, will seize your crypto assets......I'm not sure how smart you are. Buy food, ammo, anything that has real world value. Your crypto wallet isn't going to matter." - Unknown
"Yes I reckon. If you think crypto can't be stopped because it's p2p, think again. Exchanges are centralized and prone to regulation. The software distribution is centralized. ISP's are centralized. Crypto can be stopped with the snap of a central banker's fingers. It will never replace fiat on its own - you need a real uprising if you want to replace the central banking system and you don't need crypto for such an uprising. Crypto is fighting the system the same way climate vandalists are fighting climate change by glueing themselves to asphalt. You both think you figured something out and you both look retarded doing it." - Unknown
"I just want to sell titty pictures. You get on an exchange for as long as you can, until they shut your ass down. You quickly [run out of exchanges], so you sit on a lot of useless money. The whole ‘crypto is permissionless and censorship-resistant’ thing is a bunch of bullsh*t." - Allie Eve Knox on crypto not being a useful way to get payments after all her banking accounts were closed
"Actual unpopular opinion time. Crypto being embraced by govt regulation, and embracing it, removes it's utility entirely. The entire value proposition of crypto is that it's a value exchange mechanism outside of govt control. Once this is no longer the case, it has no use. And effectively worthless. Kamala/Dems banning it and trying to destroy it is going to be the only thing that saves it. But as long as institutions like Coinbase exist and cuck to KYC nonsense, it effectively remains intrinsically worthless as it's counter to its original premise. There's no need to use crypto when you can use traditional financial system in that case.
When basic transactions of illegal content can't be done via crypto anymore, it's effectively lost all meaning. I don't endorse this behavior, but people's ability to operate outside of govt control is cryptos core value proposition. Which it now completely has failed at, as people can't even sell illegal online content with it. Again, not endorsing the content, I'm explaining the value issue." - Unknown
"Bitcoin shares many of gold's monetary characteristics but has two problem areas:
1) It requires power to be useful.
2) It requires the internet to be useful.
The crypto becomes useless if 1 or 2 are missing or controlled. If these break down completely, we are back in the stone age, and gold isn't particularly useful either - only food, water, guns, ammo & medicine." - Unknown
"• 0.68 KWh to produce a dollar’s worth of silver
• 1.33 KWh to produce a dollar’s worth of gold
• 9.0 KWh to produce a dollar’s worth of Bitcoin
At .17 cents an average kwh in the US, that would mean it cost $88,570.00 to produce a Bitcon. That means a miner is losing around $33,000 to mine a Bitcon right now. This is what my deep research shows......" - Unknown
"Satoshi modeled bitcoin after gold. He even used the word mining to describe the coinbase transaction (every bitcoin block begins with a miner reward). But there's a key difference: if all the gold miners ceased operations today, gold will still have value. If all the bitcoin miners went offline, the value of bitcoin goes to zero. Yes, zero. All bitcoin HODLers will own is an unspent transaction output on a defunct chain, which can never be transferred or spent. But that will never happen, right? 11 bitcoin mining pools control the entire network. Bitcoin mining is super capital intensive, highly concentrated, and therefore, extremely vulnerable. Decentralization in bitcoin is a myth. Bitcoin's $1.2 trillion market cap is built on a mining network worth around $25 billion, a mere 40% of the market cap of gold miner Newmont $NEM. The bitcoin network is very, very fragile and at the mercy of a few giants. Gold mining is global and decentralized, but even if all mining is somehow banned, the yellow metal isn't reliant on the mining industry and will carry on as it always has - as a store of value and a monetary asset that's no one else's liability. If you really understand the principles behind bitcoin, you'll see why gold is currently a superior asset. Even if you don't understand the history of money, the price action says it all - gold is making all-time highs, bitcoin isn't. Gold has won the battle." - Unknown
"This notion that you'll buy gasoline and groceries with gold or bitcoin is madness. If government mandates NOT, it will NOT." - Unknown
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