Yes, I’ll agree to that. There is a non-zero probability it will go to zero. But looking at the adoption curve, the more that goes up, the less likely an implosion becomes. Looking at the amount of fiat money production, however (in the last few years), you can clearly see our money debasing year after year with 100% certainty. So how much is everyone’s salary going up……?
Every day that passes, we have more certainties that bitcoin won’t go to 0. And 1% growth while we do +200% on average is indeed quite conservative.
On another note, have you seen what is happening in El Salvador? Absolutely mind blowing. They started mining with their volcano energy, they plugged their “volcano node” to the network with satellite internet, and they are now issuing a “volcano bond” to raise $1b to build the first bitcoin city.
Even if you don’t like bitcoin or don’t understand what it is, what El Salvador is doing this year is incredible from a technical standpoint. I can only hope it works out nicely and have positive impacts for this country.
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Debatable. I’d argue one of the engine for the recent rise in price is institutional investors hedging against fiat currencies devaluation. Central banks are starting to take action to fight against inflation, so that could have an impact. Another big factor of uncertainty are stablecoins and regulation, that seems to be on its way. I don’t think the purpose of regulation is to destroy cryptocurrencies (or Bitcoin) but its effects on prices are hard to predict.
Just as well, there’s no way to tell Bitcoin won’t be replaced by other cryptocurrencies and stabilize below its current levels.
There’s still a huge area of uncertainties to go through. I’ll call a clearer view once we know more about the impact of regulation (that is, once the cryptospace will be regulated).
Mine is keeping up with inflation but I have no doubt it’s not the case for most people in high inflation countries. That’s the very purpose of inflation: keep things competitive and never let anybody rest on what they’ve already done. The game keeps going, if you don’t get better at keeping your portion of the pie (or getting more of it), you’re going to be left behind (up to a certain point where social insurances step in, as they should).
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Actually high inflation is an issue, but it’s well acknowledged that overall wage keep up with it.
In any case if the goal is to replace cash then you’re recognizing BTC is not a good investment (cash is not an investment).
El Salvador just says fck IMF and World Bank…
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There’s a really nice deep dive on it in today’s money stuff Be Careful With Volcano Bonds - Bloomberg
The Non-Volcano Package is a way to invest in Bitcoin plus the credit of El Salvador that is strictly better in every scenario than investing in the Volcano Bonds.
It’s really good marketing from El Salvador at least, they do know how to play the crypto crowd 
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“The president, who appeared on stage wearing a baseball cap backwards, said that no income taxes would be levied in the city, only value added tax (VAT).” (BBC)
Yes, they are doing well, although the rollout of Bitcoin was an absolute sh3tshow in the first weeks, people hated it and sold it as soon as they could, the app didn’t work well enough (not the blockchain of course, that works flawlessly). That being said, Bukele is really autocratic and very similar to other leaders in Central America, so I hope his country as a whole comes out better from this and not just the government and their friends. I believe they will, the first mover advantage is significant.
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Seems if you call anything “crypto” it is the path to untold riches
Think the following was posted before: guy who created a crypto called SCAM to take the piss but which subsequently went to USD 70m market cap for a short while (then fell back to only USD 1m)
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I appologize if the question appears dumb, but if BTC is considered a medium of exchange, and thus money, in what world does it make sense to use is as a collateral?
I may miss something very basic but isn’t akin to collaterize CHF to borrow USD? I mean it’s not like you collaterize a car or a house that you can still use in the meantime. This makes no intuitive sense to me.
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but if it’s more store of value… it would make perfectly sense.
It’s not yet a medium of exchange in most of the world, in the US it is considered as property for legal/tax purposes and as such, can very well be used and is used as collateral - see Microstrategy and CEO Michael Saylor and what they are doing to raise capital (note Saylor is a billionaire who owned Apple and Facebook very very early on, long before they were household names because he saw the value before most people did. He used to vocally call Bitcoin a Ponzi scheme but has studied it extensively and is probably the biggest Bitcoin maximalist there is by now). If anyone has 5-6 hours to kill, the Saylor Series on YouTube is hugely interesting and looks at the interaction of humans with technology as far back as prehistoric times, culminating in the digitalization of money with Bitcoin.
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Even if considered as property, it is still a liquid asset that can be sold for currencies fast and, hopefully, cheap.
For the sake of the argument, if we compare Bitcoin to gold as a store of value, people using gold as collateral, I would guess, would most often use gold jewelry that are illiquid and unique as opposed to gold bars that can be sold quickly on the market.
Why would you take a loan for X USD and put gold bars/Bitcoins worth Y USD as collateral and pay interests on X rather than sell the said gold or Bitcoin, use another collateral, and pay interests on a loan of X-Y USD? Bitcoins are even easier to sell than gold bars. Using illiquid assets, like a car or a house, as collateral make sense because you can’t simply sell your house, live in the street, and purchase another house once your loan is over.
To me this looks like a way for startups to gamble on Bitcoin increasing in value and providing a token use case to make Bitcoin appear more legitimate. Just to clarify, I own Bitcoin in my portfolio so I believe in the concept, but these loans, as I understand them, are just for show. Yes in the short term there is probably a tax advantage from the fact that you don’t pay taxes on the capital gains of your Bitcoins but if prices someday get more stable, which is a clear goal, this aspect becomes less relevant. And in any case this argument needs to be checked on a case to case basis since it’s likely that the taxes would be smaller than the difference in interest payed over the duration of the loan.
I checked the Microstrategy website but there are tens of hours of content and reading the description the content seems as vague as it gets. If you have good targeted material on the subject I would be happy to have a look.
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You don’t want to sell an asset that appreciates in value, hence borrowing against it. You would do the same with real estate for instance. And because the collateral is locked, there is no risk for the lender. If the value of btc drops, the collateral will be liquidated and the lender will have is money back. Super easy, super fast, it is a great way to borrow money.
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Because the market doesn’t believe you’re solvent and will make you pay a lot, while crypto community doesn’t care about financials and will happily buy your bonds.
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Trying to understand where the money is moving. Does anyone has (an) idea(s) about who’s selling cryptos in bulk and/or why?
Edit: for stocks/bonds, I have:
Fear of the Omicron variant (and shutdowns)
US shenaningans (debt ceiling and government shutdown discussions)
China shenanigans (real estate crisis)
Fiat shenanigans (inflation, tapering and expected to raise interest rates)
I don’t see how any of these would really impact cryptos, unless institutional investors have to sell them in bulk to cover their other obligations, affected by the aforementioned factors. Margin calls?
Whales are currently loading billions. As they can’t buy spot in their sizes, they use part of the money for those flush backs. And then set up buy prices for those in panic or with margin calls.
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And conversely when the price goes up it’s because they’re selling but they want a higher price, right?
Your theory intuitively makes no sense to me, do you have any evidence to back it up?
A theory by Willy Woo… spoofing (setting huge fake orders at very low level… they short, bots catch the signals…):
But anyway, hodlers hodl (80%?). Those price movements are caused by a relatively small portion of the accounts.
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Watch the money traffic.