Image by jeromastheking from Pixabay
“Bitcoin is doomed, Wall Street is going to crush it.” Words from my father-in-law back in 2017. Unfortunately, the old man, having been a very successful businessman, died two years ago, and never understood nor wanted to understand the revolution that he was experiencing when it came to Internet money. Using the same linear thinking that many use even today, my father-in-law had the view that, to the hammer, anything is a nail. It is undeniable, that Wall Street thinks that Bitcoin is a nail, and that is why whales, that is, banks and other gigantic and powerful financial entities, are dedicated to speculating with Bitcoin, without understanding or caring about how it works. But what's wrong with that for a decentralized system that is totally out of their control?
I already wrote a while ago here on Publish0x that trying to analyze the cryptosphere with the rules of traditional finance was like trying to explain the Higgs boson with Newton's laws.
I am increasingly convinced that to understand what a proposal like Bitcoin means, you must know physics, chemistry, thermodynamics, philosophy, and art. Bitcoin is an energetic process, a sample of what nature is capable of doing, having rules, but not regulators. There is no accumulation of energy in nature in any of its nodes or with any of its assets. When man tries to control some deposit of nature's energy, he causes momentary catastrophes, which nature itself quickly takes care of balancing again.
Why are you afraid of ETFs as Bitcoin accumulators? Why are you afraid of mining pools that tend to concentrate the system's hash? Out of pure ignorance of how the Bitcoin system works.
Bitcoin is a peer-to-peer payment system. If someone wants to play Wall Street with that, that's his/her problem. Bitcoin is still Bitcoin. Nobody is going to confiscate my coins. In any case, they are going to modify my net worth (most likely, they are going to make it grow). But they will continue to be mine because I am not going to sell them.
Where are the big names on Wall Street going to buy their bitcoins so they can launch their ETFs? Are you going to sell them?
For what obscure reason is there not the same concern with gold? What would happen if some people bought all the gold available? It is not true that Bitcoin is the only asset with an availability limit. Gold is too. There is not an infinite amount of gold on the planet, and, as in the case of Bitcoin, much gold is lost forever or will not be able to be mined profitably with current technology.
What would happen to the price of gold if someone madly starts buying all the gold available?
What if these big companies buy all the gold in the world and the majority share of Barrick Gold? Why haven't they done it yet?
What would happen to the price of Bitcoin if a few hoarded it all for themselves? Would they pay the price that bitcoin would have as they began to buy all the existing coins? I am very struck by the fact that some very respected bloggers think that ETFs are going to buy all the circulating coins at the price they have today and that then, with “x” cash, they could do it.
The demonstration goes through the absurd: How much would a Bitcoin be worth if a single entity were the only miner and the only hoarder? The answer is zero. What an idiot who paid so much money to keep all the availability of an asset that is worth nothing!!! The same argument goes for gold. In this case, one could speak of a Pyrrhus-style victory.
But history continues, and the narrative of the ignorant always has massive diffusion. (They are not going to teach that to an Argentinian).
A few days ago I found myself involved, almost involuntarily, in a discussion on LinkedIn with a series of Jurassic Park neggies, for whom the future of Bitcoin is so black, so black, that the Prince of Darkness himself would feel afraid.
Image by darksouls1 from Pixabay
Later, inquiring into the background of these guys, I saw that they had all lost a large part of their lives working as employees for some important name on Wall Street. That is, they had been molded by the hammer factory, so, they are all hammer-shaped. Therefore, for them, Bitcoin is a nail, and don't try to argue with them because no one knows more than the wisdom emanating from their brilliant careers as bank employees. It is justifiable that they are so afraid of ETFs.
Two problems deeply afflict the fearful today: the potential hoarding of all the bitcoins in the world by a few players in the international financial industry, and the hoarding of the hash in the hands of a very concentrated mining industry. This fear comes from the almost imminent approval of the long-announced ETFs, precisely promoted by the biggest players on Wall Street. Added to this, they add the unconditional support of some senators and the banking industry, whose lobby promotes a total and definitive annihilation of their most fearsome competition: cryptocurrencies.
In this discussion on LinkedIn that I had with people, well-intentioned noblesse oblige, although fearful for no scientific reason, there was talk of a “re-appropriation” and the imminent advent of a great crisis, which is usually called with the hashtag #GreatReset. The central argument of this group is that most people “are not in crypto”, but rather they have possession of some crypto assets and that all they want is for the price to rise to the moon, regardless of the costs. I disagree with this. It's not the majority. It is those with a hammer mentality who think like this, and then they see Bitcoin as a nail. But I am very clear that in January 2009 the first missile was sent to the fractional reserve system that prevails in the world, and that the Internet money revolution began. I insist that this is a philosophical and thermodynamic problem, it is not an issue to be treated with the rules of Wall Street. It would be wanting to investigate the behavior of frogs from an astrophysical observatory. For me, as for them, Bitcoin represents freedom from the establishment. Only, for me, the entry of large institutions does not represent any fear, and I think it is a great triumph that we deserve after more than a decade of support, since it represents the recognition of the power of the crypto sphere and the endorsement of government entities, recognizing it as a process that is now impossible to stop.
The fear of the evaporation of liquidity that ETFs will cause was mentioned in the group. What liquidity? One of the great features of Bitcoin is its granularity. You can buy as little as one sat. In recent years we learned to manage our economy in terms of decimals, and we learned to be liquid in this way. What evaporation are ETFs going to cause? Furthermore, Bitcoin is scarce by protocol, it is already “evaporated”, there is no need for anyone to evaporate it.
I've been engaged with Bitcoin since 2011. Since then, I've seen about 500 funerals. I've never seen someone so healthy die so many times. If you see it through the eyes of Wall Street, then I understand your fear. But this is far above mere financial speculation. Look at the amount of money that is being allocated to the improvement of Bitcoin. Where does it come from?
You would have to understand that Bitcoin is a conceptual break from what the theory of assets and liabilities is. It is an asset that humanity did not know about, and it appeared thanks to the Internet. It is not important who monopolizes it, but who mines it. The same reasoning that scares you right now could be applied to gold. Why aren't you worried about a few having all the gold? I gave you the reason previously. An asset that cannot circulate has no value. If someone buys all the gold that exists, the gold becomes worth zero. Gold is mined by nature, which is why it has value. Bitcoin is digital gold mined by a decentralized and secure network, which ensures scarcity. Those who want to monopolize it will have to put in a lot of money but not so much as to make it lose its value. If you have a gold ring, you have the value corresponding to that amount of gold, which comes from the current distribution of gold among investors, knowing that they can do nothing to mint it.
But the big difference that exists between Bitcoin and gold is that Bitcoin is divisible into small fractions that can be sent anywhere in the world by anyone in the world, with a device that fits in a pocket. For this reason, there are millions of people around the world who have Bitcoin in their wallets, something that cannot happen with fractions of gold.
I asked in the heat of the conversation: What if I don't sell my BTC?
And they answered me: “What if, after all the "loose" BTC in circulation is absorbed by those ETFs, the legacy world bets against it using the derivatives market and a bailout (#GreatReset) is needed as the result, and an executive order to confiscate all BTC is issued requiring YOU and everyone else to sell to the US Government all of your BTC? YOU would be ordered to cover THEIR short position and pay for the bailout (reset).
To which they put me for the umpteenth time the well-known Wikipedia article with Roosevelt's Executive Order 6102 at the beginning of the last century.
Roosevelt would not have dared such nonsense if instead of gold he had had to confiscate bitcoins. This is where they show their ignorance. Gold is visible to the naked eye, it is heavy, difficult to stow, and cannot be divided into very small fractions. That is, it is very easy to confiscate. How do you imagine that his/her bitcoins are going to be confiscated by an Executive Order from a merchant in Senegal? And from a doctor in Norway? And still from a student in Lebanon? Fear ends up being ignorance.
There was a person in the conversation who supported my opinions and said, referring to the most fervent fearer of the #GreatReset: “Interesting to see another gloom and doomer. The great thing about Bitcoin is that it doesn't care about the neggies. It is not emotional or political and never gets distracted by the events of the day. It is about a future where sources are validated, communications are secure, and valid transactions are confirmed with a transparent ledger. The benefits cannot even be imagined by those who may never understand the future impacts of a technology with a blockchain Foundation.”
And another one that supported my point of view added light to the tunnel: “If exchanges die off, excellent. If crypto dies off the internet 2000 bubble style, excellent. The scams and empty boxes disappear and the protocol remains, TCP-IP then, Bitcoin now. Exchanges will be replaced by those banks that want to stay in business by chiming into the Bitcoin business. And normies will be happy to remain idle in their everyday bank. Plebs will choose to be their bank which is the original idea of Bitcoin. Reminder: BlackRock & other US$ armed wings will never control Bitcoin."
Here is the key for me. Ignoring how the system works makes you scared when you see a whale. Bitcoin was born to be each person's bank. He/she who doesn't want to be his/her bank, let him/her continue as he/she is. No one will ever prohibit me from being my bank and producing my coins. It is impossible. This has been working like this for many years. We never need permission from anyone. Technology advances in friendlier ASICs so that anyone can mine Bitcoin at home. Technology will allow us to be our banks sooner or later. Once again I tell you that it is very foolish to underestimate developers. They already did it once and they will continue to do it. There is no senator or Wall Street banker who can prevent the appearance of a new code that will keep them awake once again. We could call it the Curse of the Blockchain.
Next in the conversation, the fearful people of the LinkedIn group began to send a series of articles to support their fearful theses.
A very disturbing one from Cointelegraph, with a Trojan horse as a thumbnail, that, because it was so widely used in thousands of posts, lost all credibility. The Trojan horse represents ETFs as a possible tool of control by the establishment. Of course, I'm not going to talk once again about the role of mass disinformation media in the hard work of serving interested corporations.
Then, a more disturbing one, which calls into question the scarcity of Bitcoin, was written by a former bank employee. In this article, which I am not going to show out of respect, there is an overwhelming bias towards thinking like a Wall Street banker. A hammer that only thinks about nails. Who is interested in “roulette wheels” with derivatives, IOUs, futures, binary options, and collateral with Bitcoin, more than a Wall Street employee who gives his/her life to see how he/she can screw up someone else? No one who wants to be his/her bank is interested in derivatives or futures. The problem these people have is that they see Bitcoin as just another traditional asset, and that is ignorance, nothing more than that.
Next, they sent me another article from another former bank employee that I'm also not going to show out of respect. This article is very curious because it gives the impression that cryptocurrencies invented fraud, corruption, drug trafficking, the scam industry, and also acne. Again the pig to the corn. It seems that humanity lived without problems and was in the Garden of Eden until the villains Sam Bankman-Fried and Changpeng Zhao appeared. Incredibly, this article reduces the “crypto movement” as a mere nerd game, as a new childish attempt to outwit the establishment, and once again it reminds us that cryptocurrencies only serve to finance drug traffickers and money launderers (something that the author must know first-hand, having been a bank employee). Sorry, but it angers me that bank employees say that cryptocurrencies invented scams.
I withdrew from the conversation so as not to continue wasting time. There is total confusion, fueled by the mass media of misinformation about what decentralization means. Confusion leads to ignorance of wanting to analyze the philosophical-scientific scope of an asset that humanity did not know about until a decade ago, using the tools of the previous system. A hammer to analyze the functioning of the digestive system of Nepalese storks.
Conclusion
History clearly shows that the origin of fear is ignorance.
Bitcoin is a thermodynamic energy transfer process. I understand that that was Satoshi Nakamoto's vision. What the payment system called Bitcoin does is a simple example of energy conservation by transferring elementary particles from one system to another. But with a big difference compared to other systems, the elementary particles that produce the transformation are not infinite, they are limited, and the only entity that can produce them is the network that produces the transformation. No matter how much they try, no one can alter anything. They can try to hack the system, they can try to regulate it to comply with the rules of the old system, and they can invent tools like ETFs to crush it if this were true, but still, a vast proportion of the world's population already understood the problem that mathematics and game theory have solved, and that, added to the incentive of the miners, is what gives the system its strength.
It is very childish to underestimate the power of the entrepreneur and the coder. If he/she already did it once, why won't he/she do it again? For each new hindering rule, a new code from a decentralizing brain will appear. For more than a decade the cryptosphere transferred funds from the traditional system to a new system unknown until then. As much as regulators want to continue putting obstacles in place, Bitcoin continues to show its strength every day. Whales can continue to manipulate the price and they can also continue to set up their mining pools, and even then, there is nothing they can do to disable the most secure decentralized network on the planet. Of course, they are going to try until the end. But I'm not going to sell my BTC. They can hoard all the BTC in circulation, except mine.
And yours?
Thank you for reading! Decentralize yourselves as much as you can, and much more! Work for yourselves, not for others. When you work for someone else, they pay you what YOUR POSITION is worth, when you work for yourself, they pay you what YOU are worth. No one achieves financial independence by working as an employee. Live long and prosper!
Never forget:
As usual, none of the things written in this post are financial advice and are not intended to replace personal research. My sole intention in writing this post is informative. Several of the things discussed here could be wrong, so in no way can this post be construed as financial advice, and in no way should it replace your own research.
If you have any questions or comments, please feel free to leave them down below
You can also contact me at [email protected]
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