The Bitcoin (BTC) thread

scorpion

Ostrich
Gold Member
I thought that even the most ardent Bitcoin supporters had abandoned the idea of advocating it as an actual currency, and were instead focused on it as a store of value, aka "digital gold". Bitcoin's technical and design limitations (slow transaction speeds, inherently deflationary) make it simply unworkable as a widely-used currency. Further, any country electing to use Bitcoin as their national currency is forfeiting control of their monetary policy, and thus control of their economy. Poor countries who do this will doom themselves, as they will be unable to devalue their currencies to make their exports more competitive and thereby build up their domestic economic productivity. This has been one of the biggest problems with the Euro. When you have large and powerful economies like Germany using the same currency as small and weak economies like Greece, the Greeks are then unable to utilize monetary policy to jumpstart their economy, and sink further and further into debt as a result.
 

Arado

Pelican
Gold Member
I thought that even the most ardent Bitcoin supporters had abandoned the idea of advocating it as an actual currency, and were instead focused on it as a store of value, aka "digital gold". Bitcoin's technical and design limitations (slow transaction speeds, inherently deflationary) make it simply unworkable as a widely-used currency. Further, any country electing to use Bitcoin as their national currency is forfeiting control of their monetary policy, and thus control of their economy. Poor countries who do this will doom themselves, as they will be unable to devalue their currencies to make their exports more competitive and thereby build up their domestic economic productivity. This has been one of the biggest problems with the Euro. When you have large and powerful economies like Germany using the same currency as small and weak economies like Greece, the Greeks are then unable to utilize monetary policy to jumpstart their economy, and sink further and further into debt as a result.

The Bitcoin community is still somewhat divided on this, but with the lightening network, day to day transactions are instantaneous and very cheap so it's totally feasible. El Salvador currently has a dollar based economy so they don't have control over their monetary policy anyway, and most countries with weak currencies have limited options to print money and exercise monetary policy since demand for their currency has to be absorbed domestically. Countries who adopt bitcoin but aren't competitive in their exports will simply have to come to terms with price deflation to become competitive - it's possible, just not something we are psychologically prepared for and will need a few years to adjust to. Long term it will be hugely beneficial to efficiency as prices will no longer be distorted by who is closest to the printing press (usually banks who create the money supply and recipients of government deficit spending).

In the case of Greece, currently (as far as I know) the ECB just prints Euros and buys their bonds, or the big banks lend it to Greece at artificially low rates since they expect to be bailed out if things go south. So Greece never has to 'pay the piper' and account for their bloated spending.

Under a Bitcoin standard, they won't sink further into debt as no one will be willing to lend their bitcoin to Greece. Instead prices will just keep dropping in Greece until their exports become more competitive. It will lead to a massive drop in living standards there and likely a depression in the short term and possibly even social unrest and starvation for some, but this is fair, as for the last decades the Northern European countries have been subsidizing them. Given Greece's low education standards and poor work ethic, their current standard of living does not reflect their underlying productivity.

yeah I saw this....

Not a big country, but the symbolic implications are huge. IF this proves to be successful for the country, it could influence all of central America. If it turns into a big nothing burger (in terms of real economic improvement for the average citizen), then that would not be good for the bitcoin maximalists.

A country's standard of living in the long term is tied to the quality of their human capital and natural resources. El Salvador doesn't have a great education system and, based on the gang culture of their population in the U.S., pretty crime-prone. So this will be far from a magic bullet. However, it will return to them some of the money stolen by the remittance industry, and it will make it easier for people to hide their wealth from the criminal gangs. It will also make them less impacted by U.S. monetary policy and will make it hard for the U.S. to seize their assets or freeze them out of the financial system. Among the El Salvadorans who have the self control to save their money and not waste it immediately, it will also empower them - perhaps this can have a eugenic effect by accruing economic benefits to those who are more future oriented.
 

Tactician

Kingfisher
Gold Member
My simple 4 am take is that inflation & deflation are beneficial for different parties.

If you're an asset holder, rent seeker, or govt, then you want an inflationary currency. Asset holders & those who aspire to be a part of the rentier economy favour the gains in their scarce assets. As for govts, their job is simply to convince people to build stuff using whatever tricks necessary & currency inflation does a great job of this.

If you mostly trade labour for pay, then you absolutely want a deflationary currency because this means your wage goes further.

After 1971 productivity & wages became decoupled, with productivity continuing to rise, but wages stagnated. Inflation pretty much means, "we want to cheapen your labour." Great for states/owners, but horrible for the workers making it happen. I believe many social ills & especially the constantly rising age of first marriage stem from this. Back when the currency wasn't as wildly inflationary, people got married early & the wife often stayed home to take care of the kids. Why did this change? Mostly because of really high home prices as wages didn't keep up with assets. Inflationary currencies a huge scam designed to keep the average citizen spinning their wheels & staying out of healthy relationships.

As for the idea that tech is deflationary & we need to print to offset this deflation, no, that's dumb. If tech is deflationary (it is), we should just enjoy the tons of extra productivity & free time this affords us, not print like mad to try & offset the extra productivity. That's actually the point of technological progress; to improve the standard of living + free up time & resources. It's completely natural for humanity to have more freedom as the generations go by, yet a ton of average people feel like they're more behind than ever. Why? Because they mainly play with crappy inflationary currencies. The people holding assets (representing deflationary currency) are doing great.

"But what about liquidity needed to make transactions happen? Currency would be hoarded under a deflationary regime" uhhhhh ok got me there, too sleepy for this one. Sleep well, RVF.
 

Blade Runner

Pelican
1) The implication that Trump supporters believe things about the man in a cultish fashion is disproved by the many who have supported him but will tell others that regarding BTC, he doesn't know what he's talking about if he considers it a "scam."
2) @Tactician - Kartik Gada is a futurist who now has a youtube presence, having had some interesting posts for his version of UBI to "combat technological deflation". He understands many things, but doesn't understand the many things he doesn't know in that SF/Silicon valley tech leader way, which is a very typical trait of indian americans who make it big and have egos way bigger than their inherited gifts (Ravikant is an exception, a truly wise person compared to many examples of successful indian americans who have inferiority complexes deep down)
3) Inflation and deflation are happening concurrently.
 

Arado

Pelican
Gold Member
Trump called out the Fed during the campaign for creating a bubble economy, then when he was in office he encouraged the Fed to print money to the moon to pump the stock market so he could brag before the elections. Mnuchin proposed draconian restrictions on self custody wallets. Trump's tax cuts for corporations did little for the working class. He promised he would address the debt but expanded the deficit in the middle of a boom. His actions are not in line with Bitcoin's ideals.

There's some overlap between the nationalist conservatives and the anarcho-libertarians - both trend conservative on social issues, and are against the warfare and surveillance state. Many also disagree with COVID lockdowns. Most pro-Bitcoin politicians are fiscally conservative libertarian Republicans.

However, when it comes to immigration and the rise of China, many of the crypto folks also lean globalist and don't have much of an ethno-nationalist consciousness. Listen to all of them talking about moving to El Salvador, completely oblivious to the impact of culture and genetics on a nation's prosperity. Perhaps many of them are secretly red pilled on diversity issues but just don't say anything to avoid attracting SJW attacks.

The ironic thing is that Trump's advocating for improving our manufacturing base and fewer foreign wars would be possible under a Bitcoin standard, as the dollar losing reserve currency status means that manufactured goods in Ohio would be more competitive, and we couldn't afford the endless wars. Immigration would likely go down as well as earning money in dollars would be less appealing, plus BTC adoption would likely deprive the welfare state of the ability to print dollars to fund healthcare and food stamps for moochers.
 

Tactician

Kingfisher
Gold Member
1) The implication that Trump supporters believe things about the man in a cultish fashion is disproved by the many who have supported him but will tell others that regarding BTC, he doesn't know what he's talking about if he considers it a "scam."
2) @Tactician - Kartik Gada is a futurist who now has a youtube presence, having had some interesting posts for his version of UBI to "combat technological deflation". He understands many things, but doesn't understand the many things he doesn't know in that SF/Silicon valley tech leader way, which is a very typical trait of indian americans who make it big and have egos way bigger than their inherited gifts (Ravikant is an exception, a truly wise person compared to many examples of successful indian americans who have inferiority complexes deep down)
3) Inflation and deflation are happening concurrently.

Re: Trump, I'm just laughing that now libs are FORCED to support Bitcoin. Well played, Trump. Well played :laugh:

Hey, I like Kartik & occasionally watch his YouTube Channel. Pretty cool that you mention him!

The way I see it, Kartik & tech deflation guys like Jeff Booth both recognize the amazing force of tech deflation, but have a different route to get to a similar destination. While they both want a monetary policy that offers more fairness & purchasing power, Kartik suggests tons of inflation while Jeff prefers a natural deflation. Sounds contradictory, but it mostly works out.

Roughly, Kartik sees that wages have been decoupled from tech productivity gains & wants to make up for this by giving everyone a UBI which is tied to tech progress. He describes our current QE bond purchase system as "putting two buckets next to each other & dumping water into one (asset holders) while hoping some splashes into the other (average dude)." The is absolutely correct. Our current system massively favours being close to the money printer while often leaving others out to dry. Using Kartik's UBI model, purchasing power is tied to increasing tech gains by an ever rising UBI so the liquidity needed to offset tech deflation is distributed more fairly.

A consequence of Kartik's model is that you'd still save/invest in assets instead of holding the currency. He views this as good thing because he hopes people would invest in the best tech companies & drive even more progress. That's fair. Investment itself isn't a bad concept. We're mostly fed (heh) up with how the average American is needlessly priced out of the asset market. This UBI helps to get everyone involved. However, one downside to Kartik's model is it still allows for tons of govt shenanigans & getting UBI directly to the people almost necessitates some kind of digital ID (vaccine passports anyone??). As you hint at, I don't think Kartik knows how insidious the banksters are. He mostly thinks their PhD economists are dumb, as opposed to a "feature not a bug."

I haven't watched as much Jeff Booth, but I think he mostly supports a natural deflation the same way most of us Bitcoin fans do.

tl;dr: Kartik wants to give more money evenly to everybody to shore up purchasing power. Jeff Booth prefers letting a currency deflate naturally as this also results in more purchasing power. Both are good guys.

quick edit: I'll check out Jeff more. For what it's worth, I really prefer deflationary currencies (Bitcoin!!). I think the less the govt is involved, the better. E.g. Govt policy, under a Bitcoin standard, would be extremely transparent. I also feel a deflationary currency would allow people to prioritize other aspects of Life over their finances. Just something I feel.
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Blade Runner

Pelican
Trump's tax cuts for corporations did little for the working class.

The tax cuts overall helped everyone.

He promised he would address the debt but expanded the deficit in the middle of a boom

Yes, he is or was too much of a rah-rah showman, so he was never going to address the elephant especially when taking things on at this point is a fool's errand to anyone who wants to be a politician before the US is forced to reboot.

However, when it comes to immigration and the rise of China, many of the crypto folks also lean globalist and don't have much of an ethno-nationalist consciousness. Listen to all of them talking about moving to El Salvador, completely oblivious to the impact of culture and genetics on a nation's prosperity. Perhaps many of them are secretly red pilled on diversity issues but just don't say anything to avoid attracting SJW attacks.

You are correct here. Most media and moderns don't want to believe what we all know about history and its peoples. Egalitarianism is the indoctrination of the last few centuries that sounds so good no one wants to jettison it - normies will be normies.
 

Blade Runner

Pelican
quick edit: I'll check out Jeff more. For what it's worth, I really prefer deflationary currencies (Bitcoin!!). I think the less the govt is involved, the better. E.g. Govt policy, under a Bitcoin standard, would be extremely transparent. I also feel a deflationary currency would allow people to prioritize other aspects of Life over their finances. Just something I feel.

Yes, I'm in the Booth camp. I actually like Gada, and the guys at his site posted frequently and intelligently when I recall going there. But the futurists have an evolution-like thought process and unawareness that their positions are largely non-falsifiable: they keep saying if given enough time, it'll happen, it'll happen, etc. I always suggested to them that in a few cases, if you understand what you are talking about, this may be the case, but even when it happens, it has its own limits.

You hit on why (not that it'll happen) the UBI thing he proposes shouldn't be done, and why occasionally he is so much more ego driven than wise: creating more central decisions and applications is an awful idea, however well meaning that distribution would be (and even effective).

Most of us that see the inflation deflation scenarios know that deflation is hated by central governments because it halts them from the option of being ever expanding. Most people take that, and inflationary policies, for granted, because they haven't been allowed to see just how much better it is to have reasonable stores of value and proper planning and consumption, not grow at all cost policies that ruin the world's nations over and over again.
 
I'm looking at the NASDAQ chart from the last 6 months and the dips seem to perfectly align with Bitcoin taking a dump. Right now the NASDAQ is slowly recovering and trying to retest it's all time high of 14100. I feel like if it can break above it the bullish sentiment will spill into the crypto market. If not, I'm guessing BTC price goes down to 17-26k. I have a difficult time believing the bull market is already over with a sub 60k high Bitcoin. Michael Saylor got 1.6b more in funds to invest and inflation steadily rising, Biden has retroactively doubled capital gains tax so I imagine people will be less incentivized to cash out their gains. On the other hand when you zoom out 40 years and look at the stock market it looks close or very close to a blow off top so I'm not sure what will happen. Basically I think if the NASDAQ gets rejected again at 14100 it could end the 2021 run for crypto.
 
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