# How long before nation states buy bitcoin?



## WolfeTone

A reasonable question at this point? 

Ireland has announced a deficit for 2020 of €18bn. If the government were to purchase bitcoin they would put themselves ahead of the rest (assuming other nations are not secretly buying bitcoin already). 

With collapsing finances, the disruption to the fabric of the economy will be felt in the years ahead. Having bitcoin in reserve could shoulder some of that burden.


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## jpd

Is this the start of the biggest Ponzi scam ever?


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## tecate

Singapore's sovereign wealth fund has been stacking sats since 2018. Norway's more or less in the same boat with exposure via Microstrategy & Square.


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## Duke of Marmalade

What an excellent idea.


			
				“Bloomberg analyst” said:
			
		

> Bitcoin could hit $400,000 this year”


Just imagine, if we could only get our hands on about   4% of bitcoins we could be debt free by end of this year.  But would we be happy?  We would still have the dreary steeples of Fermanagh and Tyrone to contend with.


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## Peanuts20

And when the price of Bitcoin collapses (which it will, like all bubbles), how much will the debt grow by??


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## Duke of Marmalade

Peanuts20 said:


> And when the price of Bitcoin collapses (which it will, like all bubbles), how much will the debt grow by??


Spoilsport.  The idea is to get out before the bubble bursts.  I envisage getting in and out maybe even in time for the October budget.


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## WolfeTone

Peanuts20 said:


> And when the price of Bitcoin collapses (which it will, like all bubbles), how much will the debt grow by??



Of course it will, but the problem with identitying peak bubble is nobody knows how much the bubble will rise to, and what price it will crash to. 

Implied in your comment is an assumption bitcoin is in a bubble, and at or near peak price? 
You may be right, or you may be wrong... but I'm sure I have heard this before somewhere?


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## WolfeTone

Duke of Marmalade said:


> The idea is to get out before the bubble bursts. I envisage getting in and out maybe even in time for the October budget.



According to your list of skeptics in the 'hyperbolic' thread - the list of people who know much more than you or I - the bubble is going to definitely, maybe, burst this year... around June to be precise, although they admit no-one knows what is going to happen they can definitely say it will happen this year, maybe.


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## Duke of Marmalade

Of course, the whole thing would have to be done in deadly secret, bitcoin perfect for that.  I mean borrowing ECB cheap money to buy bitcoin!  Everyone would want a piece of that.  Which makes me think that maybe Pascal has already accumulated a decent pile, let's hope so.
There is a catch though.  If we still hold a wad of bitcoin when SF come to power, would you send the private keys to the Fellon's Club on the Falls Road?


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## DublinHead54

WolfeTone said:


> A reasonable question at this point?
> 
> Ireland has announced a deficit for 2020 of €18bn. If the government were to purchase bitcoin they would put themselves ahead of the rest (assuming other nations are not secretly buying bitcoin already).
> 
> With collapsing finances, the disruption to the fabric of the economy will be felt in the years ahead. Having bitcoin in reserve could shoulder some of that burden.



It is not an unreasonable question but I don't think they would be buying it to save the economy or anything as extreme as that. The NTMA manage our public assets and liabilities, within the NTMA there are a number of funds that follow various strategies i.e. long term obligations (state pensions) to funding day to day obligations. A quick browse of the annual statement and you will see they have invested in hundreds of equities across the globe to the value of billions. They have exposure to Paypal and Square, so they have indirect exposure to companies involved in crypto activity. 

I see no reason that as institutional adoption increases the NTMA investment strategy wouldn't change to purchase direct BTC, Listed ETFs (once launched), or Public listed companies in the space.

However, given BTC is still a volatile and risky asset they would only be purchasing in size that meets their risk tolerance, e.g. I don't expect them to gamble the states pension funding on the price of BTC. 

My bet that would be that once BTC ETFs get the greenlight thats how they will get their exposure. I will caveat that on the basis that I don't think the NTMA would spend the money to put the infrastructure in place to hold BTC themselves, but given the increasing rollout of custodial services offered by FIs, they could purchase directly and let a Coinbase or Fidelity hold.


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## WolfeTone

Dublinbay12 said:


> However, given BTC is still a volatile and risky asset they would only be purchasing in size that meets their risk tolerance



True, but if nation states were to begin to accumulate bitcoin, even very small amounts, it would go someway to reducing the volatility in the long run.


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## DublinHead54

WolfeTone said:


> True, but if nation states were to begin to accumulate bitcoin, even very small amounts, it would go someway to reducing the volatility in the long run.



That is speculation. 

BTC will always remain a volatile* asset by nature of its design (that volatility may reduce as time passes). It will never be less volatile than cash and as such it will always be treated as a risky* asset by any Investment vehicle state or otherwise. This should be common knowledge because if BTC was not volatile there would be price appreciation. As of today BTC is still volatile and would fall into the riskier asset bucket, as such any investment by a state investment agency would treat it as such i.e. the beta / return of BTC is greater than the risk free market return. 

*Both Volatility and Riskiness are Dynamic that are subject to change over time


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## tecate

Peanuts20 said:


> And when the price of Bitcoin collapses (which it will, like all bubbles), how much will the debt grow by??


If a CB or sovereign wealth fund can't take a low time preference position on bitcoin, then there's no hope for the rest of us. I don't hear much about the poor craturs that bought at $20,000 but no doubt we'll hear all about the next wave of innocents who bought at 100k (or $130,000 according to JPMorgan on the basis of ever reducing bitcoin volatility) from 2022 onwards. 
As an aside, within the past 24 hours, bitcoin has overtaken the oldest fiat currency still in use (GBP£) to become the sixth 'largest' currency by market cap.


Duke of Marmalade said:


> There is a catch though.  If we still hold a wad of bitcoin when SF come to power, would you send the private keys to the Fellon's Club on the Falls Road?


Ah, Duke - you do yourself a disservice by distinguishing between one group of governing clowns and another. However, if we must - I'd say it would be a 2 of 3 multi-sig affair with one set held by the minister of the day, and one each held by Ursula Van Der Leyen & the Healy-Rae brothers.


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## tecate

WolfeTone said:


> True, but if nation states were to begin to accumulate bitcoin, even very small amounts, it would go someway to reducing the volatility in the long run.


The tide is turning on the subject. These latest comments from US Republican House Leader, Kevin McCarthy yesterday suggest as much.


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## bish123

It's an excellent idea. We just have to keep an eye on Reddit ringing the bell at peak.


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## Duke of Marmalade

tecate said:


> The tide is turning on the subject. These latest comments from US Republican House Leader, Kevin McCarthy yesterday suggest as much.


KMaC was a bitcoin fan in 2018 according to the interviewer.  We also have the following quote from the interviewer.
_"You are very rare in the political class in supporting bitcoin"_
Amazing how different folk can read the exact same interview in opposite ways.
I read this as a maverick who was out on his own 3 years ago and is still out on his own now despite having been "proven right".
The cult sees this as a belated turning of the mainstream tide to the faith.


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## tecate

Duke of Marmalade said:


> KMaC was a bitcoin fan in 2018 according to the interviewer.  We also have the following quote from the interviewer.
> _"You are very rare in the political class in supporting bitcoin"_
> Amazing how different folk can read the exact same interview in opposite ways.


I heard that loud and clear. However, I'm not sure what you expect exactly? We have people time and time again warning that governments will ban it - now and over the course of the discussion here over the last 4 years - and yet it's getting increasing support on Capitol Hill. The suggestion was never that every congressman and representative in Washington is talking it up. Yet you have the likes of Warren Davidson, Darren Soto and others introducing legislation that is amenable to cryptocurrency. You had Patrick McHenry coming out at the time of the Libra hearings in 2019 saying that Bitcoin could not be stopped - and speaking positively about it. I watched those hearings in their entirety back then and there were a whole host of congressmen who spoke positively about it.
The state of Wyoming has changed its laws to facilitate the crypto sector. The state is now represented by a former State Treasurer who has held bitcoin personally for many years already, sits on the finance committee and is outspoken in her support for decentralised crypto and bitcoin.
The mayor of Miami and the state of Texas are following suit.
So Duke, it too amazes me how different folk can read the exact same interview in opposite ways.



Duke of Marmalade said:


> The cult sees this as a belated turning of the mainstream tide to the faith.


You keep using that terminology and you deserve the obligatory response as regards where the real 'cult' exists -> Link


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## DublinHead54

In fear of going off-topic, I don't think the American political system is something we should hang our hats on. The below is a clear example of a conflict of interest, of course, the holder of BTC has a vested interest in pro crypto laws if it leads to a price increase. Similar to how Nick Lachey lobbied for the legalisation of weed in Ohio a few years back when him and his investors owned the farms that would be allowed to grow it. 


tecate said:


> The state of Wyoming has changed its laws to facilitate the crypto sector. The state is now represented by a former State Treasurer who has held bitcoin personally for many years already, sits on the finance committee and is outspoken in her support for decentralised crypto and bitcoin.



Back on topic, the continued adoption through whatever means will make it easier for Governments Treasury functions to invest in BTC, but as mentioned above I don't think this will signal any large change in government strategy rather BTC will just be treated like any other investment in a well diversified portfolio. 

I would like to hope that nobody here would be supporting governments gambling the pension fund on BTC.


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## NoRegretsCoyote

Dublinbay12 said:


> I see no reason that as institutional adoption increases the NTMA investment strategy wouldn't change to purchase direct BTC,


If any state body buys bitcoin directly it would be the Central Bank as part of reserve management policy.

The Central Bank already holds gold. The NTMA does not, and never would.


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## WolfeTone

Listening to Leo on RTÉ earlier talking about the disruption to the economy. He mentioned that as we don't have gold, oil or gas, we are very susceptible to what happens elsewhere in the global economy. 
The interviewer missed the opportunity to then ask him about bitcoin.


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## Duke of Marmalade

WolfeTone said:


> The interviewer missed the opportunity to then ask him about bitcoin.


Obvious answer.  We have plenty of BOHA.


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## tecate

WolfeTone said:


> The interviewer missed the opportunity to then ask him about bitcoin.


Somehow I doubt Leo would be as well informed on the subject as this politician when interviewed yesterday.


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## tecate

NoRegretsCoyote said:


> If any state body buys bitcoin directly it would be the Central Bank as part of reserve management policy.
> 
> The Central Bank already holds gold. The NTMA does not, and never would.


What would stop the NTMA holding a couple of percent in btc via a custodian?


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## NoRegretsCoyote

tecate said:


> What would stop the NTMA holding a couple of percent in btc via a custodian?


Its legal obligation to seek a rate of return


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## WolfeTone

NoRegretsCoyote said:


> Its legal obligation to seek a rate of return



I don't see anything in that that precludes NTMA from buying and holding bitcoin.


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## NoRegretsCoyote

WolfeTone said:


> I don't see anything in that that precludes NTMA from buying and holding bitcoin.


Then read it again.

First obligation is to support economic activity in state.

If not possible, to hold assets with a rate of return.

Bitcoin, which pays no interest and has a non-trivial risk of being worth zero in the near future, is in neither category.


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## WolfeTone

NoRegretsCoyote said:


> First obligation is to support economic activity in state.



Yes, but that is all a matter of interpretation. I recall the NPRF which was set up to deal with the projected increasing costs of pensions.
But at the flick of a switch, this fund was raided to support increasing government deficits.



NoRegretsCoyote said:


> Bitcoin, which pays no interest



But its prospective capital appreciation  is surely a legitimate reason to hold some (the Minister of Finance just needs to amend the Act).



NoRegretsCoyote said:


> has a non-trivial risk of being worth zero in the near future



It has had a non-trivial risk of being worth zero in the near future, for 10yrs and more.
It also has a non-trivial risk of being worth substantially more than it is today.

I'm not suggesting betting the house on it. We are a €250-300bn economy?

An initial and modest €250-€500m purchase would be reasonable.


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## noproblem

Is there a mechanism by which the Central Bank could buy Bitcoin, or its equivalent, but not directly buy it?
Then again, maybe the Euro will turn digital at some point as maybe all currencies will


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## tecate

noproblem said:


> Is there a mechanism by which the Central Bank could buy Bitcoin, or its equivalent, but not directly buy it?


There are  bitcoin ETN/ETP/ETFs in various countries (although still not in the US) or trusts such as the Grayscale Bitcoin Trust. That said, why wouldn't you want them to buy direct? There are insured, regulated custodians who can facilitate that for them.



			
				noproblem said:
			
		

> maybe the Euro will turn digital at some point as maybe all currencies will


There's no doubt that they will eventually - they're all working on digital currency projects right now. However, they're just an extension of fiat currency - which is entirely different to bitcoin. If anything, their advent will make people more comfortable in owning bitcoin.


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## DublinHead54

tecate said:


> What would stop the NTMA holding a couple of percent in btc via a custodian?



Lol are my posts just being ignored? 

NTMA already hold Square and Paypal so you could argue they have some indirect exposure to BTC. They would just have to go through their internal governance process to get approval to purchase BTC directly, or indirectly (ETFs / Funds) etc. As mentioned before it would likely only be a small portion of their investment pot. 



tecate said:


> There are  bitcoin ETN/ETP/ETFs in various countries (although still not in the US) or trusts such as the Grayscale Bitcoin Trust. That said, why wouldn't you want them to buy direct? There are insured, regulated custodians who can facilitate that for them.
> 
> 
> There's no doubt that they will eventually - they're all working on digital currency projects right now. However, they're just an extension of fiat currency - which is entirely different to bitcoin. If anything, their advent will make people more comfortable in owning bitcoin.



@tecate you are right, there is no reason why you wouldn't want to buy them direct. However, at the minute it comes down to infrastructure and control. Having worked in a global investment bank we tried to onboard clients to get exposure to BTC futures a few years ago and there was an incredible amount of bureaucracy and committees we had to go through before ultimately failing at that point in time. On the infrastructure side the NTMA doesn't have the controls in place to purchase directly, which can be offset by custodians but this still would require a whole new control process to be put in place. So right now, I think state bodies will follow their processes and get exposure via synthetic products or exchange traded products. 

On the CBDC as mentioned before, this is a topic close to my heart and you are right it's just an extension to the Euro for example. It is really more of a technology solution than a change in monetary policy although a digital currency does pose some interesting questions on the need for financial intermediaries. Ultimately cash is already pretty digital ( <10% of the circulating currency is physical), most people in Ireland can go day to day using their card only.


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## Duke of Marmalade

I believe that a significant part of the demand for physical money is in fact the black market.
Just as the requirement for money to have intrinsic value impeded monetary policy in the past so today the requirement for physical cash is an impediment as it effectively sets a floor to the interest rate on cash which in turn can lead to hoarding.  I am sure that at some stage all money, qua medium of exchange, will be CBDC.
They say that one of the features of any money is to be a store of value.  I would want to qualify that.  Its primary purpose is to be a medium of exchange.  That requires some sense that if you sell your goods or services for a € today, you expect that you will be able to exchange that € for goods and services at some time in the future - ergo some store of value is a requirement.  But this need only be relatively short to medium term.  The ECB sets a target for money to lose 2% of its value every year. That is not happening now because of the "floor".  Without the floor the achievement of that target becomes much more manageable.
@tecate will scream that I am advocating that the authorities can rob the populace of their hard earned money.  Not at all.  Money should not be held as an investment, but merely as a medium of exchange.  In a healthy economy people will be able to invest their savings possibly through financial intermediation.


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## WolfeTone

Duke of Marmalade said:


> I am sure that at some stage all money, qua medium of exchange, will be CBDC.



And this is not a concern for you? 

That aside, it could only ever happen if CBDC operated within the parameters of a monetary system that is not, or could not, be subject to 'policy' change. 
That CBs take on the mantle of issuing digital currency suggests very strongly that the parameters would be subject to change - otherwise why do it? 

This is all well and good if you are the beneficiary of such changes, but if you are not, then there will always be demand for alternative forms of money.


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## Duke of Marmalade

WolfeTone said:


> And this is not a concern for you?
> 
> That aside, it could only ever happen if CBDC operated within the parameters of a monetary system that is not, or could not, be subject to 'policy' change.
> That CBs take on the mantle of issuing digital currency suggests very strongly that the parameters would be subject to change - otherwise why do it?
> 
> This is all well and good if you are the beneficiary of such changes, but if you are not, then there will always be demand for alternative forms of money.


Not sure of your point.  I wasn't specifically ruling out bitcoin, in fact I am a bit off topic.  Just remarking that the need for physical money will become as unnecessary and counterproductive as the need for intrinsic backing once was.  Not sure in this world how auntie would give a few bob to a 6 year old for a birthday present.


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## WolfeTone

Duke of Marmalade said:


> Not sure in this world how auntie would give a few bob to a 6 year old for a birthday present.



Tokens, digital coins.


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## tecate

Duke of Marmalade said:


> I believe that a significant part of the demand for physical money is in fact the black market.


I agree that it is. There are folks who don't want to pay their dues or those that deal in illicit goods/services. However, it's important to note that what one regime deems to be 'illicit' could be  a basic human right in another. For example, I may want to donate money to the _End Statist Cults_ Committee. You could say I have some strange interests but if we believe in a healthy democracy, then all has to be embraced. No problem in doing that in cash (and possibly in bitcoin*) but if in CBDC, those behind that currency can see that I made that contribution forever and a day. I could find myself on a 'list' - or they could decide then and there - at the tap of a button - to erase my CBDC funds.
There isn't anyone on the planet that should want that scenario to unfold.
Secondly, whilst there may be folks that don't want to pay their dues, doesn't black market activity shoot up when taxes become overbearing and downright unreasonable? This is kind of related to the first point. Some might think that government couldn't possibly put a foot wrong - but that's not what history and experience tells us. I'm just putting that out there - I'm not advocating for people to fail to contribute for the upkeep of the state.



Duke of Marmalade said:


> @tecate will scream that I am advocating that the authorities can rob the populace of their hard earned money.  Not at all.  Money should not be held as an investment, but merely as a medium of exchange.  In a healthy economy people will be able to invest their savings possibly through financial intermediation.


It would be wrong of me to disappoint Duke - so let the screaming commence. I have not called out fiat money on its inability to act as an investment - i've called it out on its inability to hold its value. As regards the notion that people can go and invest - shouldn't systems be setup for all of the people - not for a minority?  By that I mean that the majority of people are not financially savvy. It's not a reasonable expectation to assume that everyone can get ahead of this stealth tax. Only the owners of assets have any chance of staying ahead of that game - seeing as we may have CPI of 2% but specific asset price inflation way in excess. That's not an equitable system.
I don't think its unreasonable to seek to have a system where people's hard earned savings hold their value. The availability of this system to the populace is also going to make the governments and CBs behind fiat currencies much more responsible. They can't steal from the people or indulge in negligent policy with the expectation that they can wash that all away with a wave of inflation. In that instance, you're talking about improving the lives of millions of people. Ireland may be relatively stable but there are plenty of places in the world that are not.



WolfeTone said:


> That CBs take on the mantle of issuing digital currency suggests very strongly that the parameters would be subject to change - otherwise why do it?


The ultimate in financial surveillance and supreme ability to manipulate. They can insist that you are rewarded for spending funds on certain things, punished on others. They can potentially 'expire' your funds if not used within a certain time frame.


Duke of Marmalade said:


> Just remarking that the need for physical money will become as unnecessary and counterproductive as the need for intrinsic backing once was.  Not sure in this world how auntie would give a few bob to a 6 year old for a birthday present.


If we do away with cash, we will need a digital alternative. That alternative is bitcoin. We'll have CBDCs - but we'll need an alternate system to run alongside them - and keep them in check.



Duke of Marmalade said:


> Not sure in this world how auntie would give a few bob to a 6 year old for a birthday present.


They'll both be fine - they'll both have a Breez Wallet and the ability to ping a few satoshis from one to the other within a couple of seconds.

*Bitcoin doesn't ensure privacy right now - but there are ways to use it anonymously. There are also software updates which could potentially be applied to make it truly anonymous.


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## DublinHead54

Cash offers more privacy than BTC, so BTC is not a direct replacement for Cash.


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## WolfeTone

Dublinbay12 said:


> Cash offers more privacy than BTC, so BTC is not a direct replacement for Cash.



That depends. Two people walking through an airport one with a 100bitcoin on his phone, worth €5m of bitcoin and the other with €5m in cash. 

Who is more likely to have their privacy interrupted?


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## Duke of Marmalade

Interesting and somewhat less confrontational discussion on CBDC, albeit off topic. 
I am thinking outside the box.
I am seeing money as nothing more or less than a medium of exchange - not something that makes the world go round.  Of course those who manage the money are in a powerful position as are those who manage our water supply and our electricity supply etc. but that is a matter for our political system to ensure that these powerful central authorities serve society.
The zero bound to interest rates is currently hampering monetary policy.  No matter how easy the CB make monetary conditions they can't generate that required boost to activity which would be reflected in a 2% inflation.  People are happy to hoard their money even at 0% interest.  Physical cash is a hindrance to the CB inducing the populace to start spending.
Talk of people deserving to earn a return on their hard earned savings has a nice morality ring to it but that is not why traditionally savings earned a return.  Savings earned a return because some folk can invest your money today to earn an economic return.  In a world where money had been reduced to its essential function of being a medium of exchange the CB will be endeavouring to ensure that there is no hoarding of money - if necessary by negative interest rates even for the populace.
Folk who then accumulate more money than they need as a medium of exchange can lend it to those who need it now and can earn a return on it.  This would mostly be done by owning deposit accounts with the banks.  Banks will pay interest on those deposits because it has takers who will pay even more interest to have use of those funds now.  Just like the old days.  The reason this is not happening now is because the CB monetary policy is channelled through the banks.  Why would banks pay punters 2% when they can borrow from the CB at 0%?
I see a brave new world where it would be perfectly consistent for the CB to be charging punters 4% on their money whilst banks are paying 2% on deposits and entrepreneurs are paying 5%  to banks on their loans.
I would even allow bitcoin to be used by the cultists and criminals. (sorry for the sour note, but I really would like to see that link from @tecate again.)


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## tecate

Duke of Marmalade said:


> Of course those who manage the money are in a powerful position as are those who manage our water supply and our electricity supply etc. but that is a matter for our political system to ensure that these powerful central authorities serve society.


Time and time again, they've been proven to serve themselves....going as far back as the Romans shaving coins. I don't trust them - you have said in the past Duke that we must trust them. I don't agree - not when we have a better mechanism that assumes we can't and shouldn't trust.




			
				Duke of Marmalade said:
			
		

> Interesting and somewhat less confrontational discussion on CBDC, albeit off topic.
> The zero bound to interest rates is currently hampering monetary policy.  No matter how easy the CB make monetary conditions they can't generate that required boost to activity which would be reflected in a 2% inflation.



By all accounts, they won't be able to win that battle as tech is leaping ahead exponentially. In their debasement tinkering in the short term though, it's likely that they'll oversteer and we'll end up with considerable inflation. We already have it in terms of assets.



			
				Duke of Marmalade said:
			
		

> People are happy to hoard their money even at 0% interest.  Physical cash is a hindrance to the CB inducing the populace to start spending.


Yeah - this. Exactly this, Dukey. This crap show needs to be dismantled. Firstly, who is happy to hoard their money knowing that its being debased!...except maybe those that don't have a full understanding of that.
Secondly, what a system we've built - where it requires people to be encouraged to buy any old crap - to fuel the economy. Bitcoin wrongly gets a kicking on the energy/environmental front when it's this current economic system that is driving environmental problems with people being induced into buying rubbish for the good of the economy. Meanwhile, we're actively encouraging people to be up to their eyeballs in debt while responsible people who work hard and save are punished. Who dreamt up this nonsense?



			
				Duke of Marmalade said:
			
		

> Talk of people deserving to earn a return on their hard earned savings has a nice morality ring to it but that is not why traditionally savings earned a return.


You're misrepresenting what I stated. I said that people have a reasonable expectation that their money holds its value - not earn a return - simply hold its value. If they want to go beyond that, they can invest or lend it out, etc.




			
				Duke of Marmalade said:
			
		

> I see a brave new world where it would be perfectly consistent for the CB to be charging punters 4% on their money whilst banks are paying 2% on deposits and entrepreneurs are paying 5%  to banks on their loans.


That's the old world. The new world - which we're already seeing early signs of - is one where people have the option to opt out of that nonsense and hold their funds in a parallel and separate system where what they've worked hard for retains its value relative to monopoly fiat money. Right now its speculative investing. When it settles, that's exactly what it will do.



			
				Duke of Marmalade said:
			
		

> I would even allow bitcoin to be used by the cultists and criminals. (sorry for the sour note, but I really would like to see that link from @tecate again.)


Always a pleasure, your Dukeness - never a chore!
As regards you 'allowing' bitcoin - that's not a power that you or anyone else has. It's there for anyone to use if they want to...even you Duke.


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## NoRegretsCoyote

@Dublinbay12 

Holding bitcoin directly or via a fund is simply not within the NTMA's legal mandate.


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## SPC100

Tuesday.


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## SPC100

I heard Tesla was going to pay it's tax bill in btc.

(Sorry for tongue in check replies)


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## WolfeTone

Duke of Marmalade said:


> No matter how easy the CB make monetary conditions they can't generate that required boost to activity which would be reflected in a 2% inflation



This is critical to try understand. The 'desired' 2% inflation rate is a peculiarity.
It is all well and good in a stable economic environment to pursue such a policy.
But we are not in a stable economic environment, the global economy has had a massive shock.
Perhaps targeting a 10% or 20% inflation rate would be more apt in fighting off a deep prolonged deflationary period?

There is also a simple view of what inflation is - increase the money supply and prices will begin to rise as more money chases fewer goods.
This is too basic. It is evident in asset prices like fixed quantities of stocks, or slow production of housing. But technological advances in science, particularly with food production, means we live in times of abundance. In a globalised economy the supply chains are vast ensuring a much feared toilet roll shortage never materialised with the outbreak of Covid.
The digitalisation of much of what we consume is also a leading factor in deflation.
There was a time I would spend 0.30punts on a bus trip into town to flick through the record albums pressed on vinyl, in cardboard sleeve, wrapped in cling film. All the production, design, distribution, retail is gone. Replaced by digital versions, much more economically efficient with technological advances and the Internet are ripping through industry after industry.

Here is a theory, with the good ship human economy owing itself some three times more than it values itself, CBs should _raise_ interest rates to induce an inflationary effect.
Huh?
Yes, raise interest rates and the cost of borrowing will rise, those companies that strategise on increasing market share by taking on more debt will feel their balls being squeezed in the short to medium term. In the medium to long-term it will open the door for market competition entrepreneurship. But with less money (or more expensive money) chasing greater market share, only those with healthy balance sheets can compete and sustain themselves, driving out inefficient debt-ridden monopolists.
Of course there will be a cost to all of this, inflation - but that is the aim of CBs.



Duke of Marmalade said:


> In a world where money had been reduced to its essential function of being a medium of exchange the CB will be endeavouring to ensure that there is no hoarding of money - if necessary by negative interest rates even for the populace.



Negative interest rates will induce hoarding, in cash.
If I have €100 in a bank account and in a years time it will be €98. I will keep my €100 in cash, it will still be €100 in a years time.



Duke of Marmalade said:


> I see a brave new world where it would be perfectly consistent for the CB to be charging punters 4% on their money whilst banks are paying 2% on deposits and entrepreneurs are paying 5% to bank



I see the end of retail banking. In a world of CBDC and the Internet, if the prevailing interest rate is 5%, why would I borrow 10% from a retail bank? There is simply no need for them if a CB can deposit money into my account online at 5%.


----------



## WolfeTone

NoRegretsCoyote said:


> Holding bitcoin directly or via a fund is simply not within the NTMA's legal mandate.



Nor was using the NPRF to plug government budget deficits, until the law makers changed the rules. 
That is all it would take, a simple rule change in legislation and the NTMA could buy and hold bitcoin.


----------



## NoRegretsCoyote

WolfeTone said:


> a simple rule change in legislation


Primary legislation is rarely simple


----------



## WolfeTone

NoRegretsCoyote said:


> Primary legislation is rarely simple



A Statutory Instrument, defining cryptocurrency as a legitimate asset within the scope of the NTMA remit, is not difficult at all.


----------



## NoRegretsCoyote

@WolfeTone 

An SI is not primary legislation.

AFAIK the NTMA act doesn't provide for such type of SI.


----------



## WolfeTone

NoRegretsCoyote said:


> An SI is not primary legislation.
> 
> AFAIK the NTMA act doesn't provide for such type of SI.



It doesn't need primary legislation. The primary legislation giving existence, function and authority to the NTMA already exists. 
There is literally 13 SI's already associated with the primary legislation for other matters.


----------



## Duke of Marmalade

WolfeTone said:


> Negative interest rates will induce hoarding, in cash.


You obviously missed my whole point.  I was talking about a world where there was no cash.  I won't bother delving too deeply into the rest of your post as it seems, as others have remarked, that you are a tad out of your depth on these matters.  Stick to the UI debate, easy stuff that.


----------



## WolfeTone

Duke of Marmalade said:


> I was talking about a world where there was no cash.



Ok, I missed that point. But probably because I pointed out to you that it can only happen within the parameters of a robust and sound monetary system. That's not going to happen.



WolfeTone said:


> That aside, it could only ever happen if CBDC operated within the parameters of a monetary system that is not, or could not, be subject to 'policy' change.



As you stated, you didn't quite get that.
A cashless society in a monetary system controlled and directed by CB policy is a delusion.



Duke of Marmalade said:


> I won't bother delving too deeply into the rest of your post as it seems, as others have remarked, that you are a tad out of your depth on these matters.



Ah, don't give up on me Duke, I'm always willing to learn and understand why conventional economic theory of lowering interest rates bringing forth the holy grail of the 'desired' 2% inflation rate has been an abject failure, for 6-10yrs in US and Europe.
Could it be, that CB's are simply out of their depth and can see no other way to keep social order and restore bankrupt over indebted economies to rude health other than flood economies with cheap, and now free money?
Be sure to point me to the economic school of thought that came up with that one.


----------



## tecate

SPC100 said:


> I heard Tesla was going to pay it's tax bill in btc.
> 
> (Sorry for tongue in check replies)


If memory serves, there are a couple of states in the US that will accept payment in crypto - alongside the canton of Zug in Switzerland. That said, I wouldn't let that concern you too much. You can now organise to receive payments in crypto without the payer having to mess about with that conversion  - through services like Jack Maller's Strike.  They can also send your crypto and convert it with little slippage - and the tax man (or whomever else) gets paid. Slippage is going to decrease when it comes to exchanging between digital assets and between digital assets and fiat (soon enough to become purely digital).
For individuals working with crypto, the last 18 months has seen the introduction of a gazillion visa products that facilitate spending crypto (as with a view towards their own survival, visa are embracing the change that's coming rather than fighting against it).
I'm not sure why people make a big deal about any difficulty paying taxes with crypto. Yes, tax authorities and their government friends can insist on the use of fiat currency when they have a gun to your head. Bitcoin was started by a couple of guys on an online message board with no marketing spend, no guns, etc - just code... and in 13 years its gone from zero to a trillion dollar asset. Paying taxes is just one of many transactions individuals and businesses need to make. I wouldn't give it a second thought.


----------



## Duke of Marmalade

WolfeTone said:


> Ok, I missed that point.


That is what my whole last few points were about.  The real possibility that we could dispense with physical cash and its implications for monetary policy.
That you missed this central point may of course be due to my pitiful communication skills.


----------



## WolfeTone

Duke of Marmalade said:


> The real possibility that we could dispense with physical cash and its implications for monetary policy.



Yes, and my response to that is that it could only work if operating within a sound and robust monetary system where the rules were not subject to change at the whim of policy makers in a CB. 
Without that, there will always be a demand for alternative money. 

Like gold. You can't change gold, it is what it is. Its supply may increase, but that requires investment and heavy energy use. Increasing the supply of gold is a slow burner, unlike fiat currency. Noting that some 20% of US dollar supply has come into existence in the last decade or so. 

So while a total cashless society may emerge, there will always be a demand for alternative forms of money while monetary systems are subject to the policy decisions of CBs. 

Your brave new world is already dead in the water I'm afraid to say.


----------



## Duke of Marmalade

WolfeTone said:


> Without that, there will always be a demand for alternative money.


_Wolfie _I am trying to open your mind.  You are obsessed with money's store of value attribute.  People are understandably wobbly on that aspect these days and so look for alternatives such as bitcoin.  But try and picture money as purely a medium of exchange, a unit of account, a ledger recording your debits and credits in the daily exchange for goods and services.  Nobody in their right minds holds it as a long term store of value.  Why?  Coz the people who supply it have stated their aim to ensure it loses value at 2% per annum.  Any surplus money available for savings should be immediately used to purchase investments/assets.


----------



## WolfeTone

Duke of Marmalade said:


> Nobody in their right minds holds it as a long term store of value. Why? Coz the people who supply it have stated their aim to ensure it loses value at 2% per annum. Any surplus money available for savings should be immediately used to purchase investments/assets.



No disrespect Duke, but aside from the actual (diminishing) presence of physical cash, what you are describing is already happening to a large extent - see bonds, stocks, property, bitcoin.

If we get to an absolute cashless position, with a guaranteed diminishing return of 2% pa on bank balances, then correct, the overwhelming impetus for Joe and Josephine public would be to invest in assets and other investments. Of course, any returns on assets through rents and dividends will have to be spent or re-directed back into assets and other investments, otherwise they will lose 2%pa value sitting on a bank deposit account.
All of this will herald the greatest asset bubble of all time. Those who own the assets can sit back and fatten up, gorging on the "shrewdness" of their investing nous. Those without assets - those who who income is enough to support their daily necessities, or who eventually get squeezed out in this system - can run the hamster wheel, supporting this charade, being bled dry on the basis that those that control the money supply have stated that the value of the return on their labour shall diminish 2%pa.

What you are signalling Duke, is recipe for revolt.
But I don't want to be too hard on you. I don't think you are alone in this type of thinking. In fact I think it is a useful reminder to me of how pervasive this type of thinking is in general, and how rooted it actually is this monetary system.
I had sold out a stake in bitcoin to retrieve my initial outlay and profit some.
But I'm starting to think at $60,000, it is starting to look cheap once more.


----------



## DublinHead54

NoRegretsCoyote said:


> @Dublinbay12
> 
> Holding bitcoin directly or via a fund is simply not within the NTMA's legal mandate.



Oh, what's the specifics on that? 

I wasn't suggesting they could now, but given they invest in Equities etc that they could get approval to invest in BTC. I wasn't aware of a legal mandate that prevents them ever investing in it.


----------



## NoRegretsCoyote

Dublinbay12 said:


> I wasn't suggesting they could now, but given they invest in Equities etc that they could get approval to invest in BTC.


The NTMA's investment mandate is here. I don't see how a virtual asset that pays no interest that has a material chance of being worth zero in the medium term is consistent with that mandate.


----------



## WolfeTone

NoRegretsCoyote said:


> The NTMA's investment mandate is here. I don't see how a virtual asset that pays no interest that has a material chance of being worth zero in the medium term is consistent with that mandate.



It's hard not to see how a virtual asset, appreciating on average 200% a year, over the last 10yrs, would not qualify under section 39 (4) of the Act.

Section 39 (1), (2), (3) are subjective. Only when we get to subsection (4) is there some meat on the bone.

_"(4) *In determining* *what is an appropriate* *rate of return* to seek to secure for the purposes of subsection (2) or (3), the Agency *may aim for different levels of return* *for different investments *and *types of investments* provided that it seeks to secure, over the long term, in relation to the assets of the Fund (taken as a whole) a rate of return greater than the annual interest cost of the general government debt (that is, the total gross debt at nominal value of the general government of the State, as arrived at in accordance with Council Regulation (EC) No. 479/2009 of 25 May 2009 1 as amended by Council Regulation (EU) No. 679/2010 of 26 July 2010 2) averaged over 5 years."_

First point - although the Act is 2014, realistically crypto and bitcoin would have been light years from the minds who compiled it.

Second - it is completely open ended and open to interpretation.
The NTMA may operate a standard, traditional, conventional approach to investing funds and civil servants are notorious for not adopting change preemptively . They tend, with reasonable qualification, to wait until change foists itself upon them before acting.

Third point, _(5) The assets of the Fund may be held or invested in or *outside* the State._

Now when Leo says "we have no gold", who doesn't believe him? There is no Irish  Fort Knox.
But, according to an answer by MoFinance, Paschal (arguably one of the best performing Ministers) to Pearse Doherty (arguably the best performing opposition in 20yrs or more), Ireland does have its store of gold, but it is held with BoEngland.
Paschal to Pearse

Fourth point, _(6) All income, *capital* and other benefits received in respect of holdings or investments shall be paid into the Fund._

To me, it is an obvious open goal. There is no restriction, whatsoever, on legal grounds, that stops the NTMA buying and holding bitcoin.
If the NTMA were to buy bitcoin, no doubt opposition politicians would protest at this unconventional use of funds. Politically, it is a system of democratic opposition that prevents government agencies from jumping ahead of itself making preemptive decisions.
Only when democratic opposition is voiceless and unrepresented does the government impose its will unimpeded - NAMA for example.

However, legally, there is nothing to stop the NTMA owning bitcoin. Politically yes, but legally no.


----------



## NoRegretsCoyote

WolfeTone said:


> It's hard not to see how a virtual asset, appreciating on average 200% a year, over the last 10yrs


Bitcoin has had spectacularly negative returns over certain time horizons too.




WolfeTone said:


> Ireland does have its store of gold, but it is held with BoEngland.


 
Yes, held by the Central Bank in the context of reserves management. If an Irish state entity ever purchases bitcoin it will be the Central Bank as part of holding foreign exchange reserves (but I doubt it). 

Bitcoin will not be hold by the NTMA under its investment mandate which is primarily to support economic activity in the state.


----------



## WolfeTone

NoRegretsCoyote said:


> If an Irish state entity ever purchases bitcoin it will be the Central Bank



I've been knocking on the wrong door so?


----------



## Duke of Marmalade

@WolfeTone I think Section 39(4) would allow NTMA to back High Definition for the Epsom Derby, if they thought it had a good chance of winning.  And they have as much cause to take a punt on the Derby as on any crypto, in fact the former actually has more intrinsic value.


----------



## tecate

@NoRegretsCoyote  :  Just so that I fully understand this, the NTMA has never owned and can never own gold or gold ETFs or derivative products - as it's legally precluded from doing so?


----------



## WolfeTone

Duke of Marmalade said:


> in fact the former actually has more intrinsic value.



Oh no! It's the "instrinic value" card being played, again!
I haven't heard this one since bitcoin was around $3,000.


----------



## tecate

WolfeTone said:


> Oh no! It's the "instrinic value" card being played, again!



Dukey's intrinsic value card is increasingly becoming a moot point. It's neither here nor there if bitcoin is being accepted as a store of value. Here is Robert Caplan, President of the Dallas Federal Reserve Bank saying "it's clear, bitcoin is a store of value'. That - from a central banker.


----------



## Jim2007

WolfeTone said:


> Of course it will, but the problem with identitying peak bubble is nobody knows how much the bubble will rise to, and what price it will crash to.
> 
> Implied in your comment is an assumption bitcoin is in a bubble, and at or near peak price?
> You may be right, or you may be wrong... but I'm sure I have heard this before somewhere?



So long as the general public can't walk into a shop and buy a bar of soap with bitcoin it remains very vulnerable.  If the Fed/ECB/BIS were to issue instructions for banks to stop the conversion of bitcom, how long to you think it would take for it to hit the floor?  Most of the holders are not 'believers' and they will jump at the first sign of trouble... and once the race to the bottom begins....  With it all being so automated, I'd give it an hour.


----------



## Jim2007

tecate said:


> Dukey's intrinsic value card is increasingly becoming a moot point. It's neither here nor there if bitcoin is being accepted as a store of value. Here is Robert Caplan, President of the Dallas Federal Reserve Bank saying "it's clear, bitcoin is a store of value'. That - from a central banker.



But it is no more being used as a store of wealth than the tulips were...  it's value is primarily driven by fear and greed.  And the minute if ventures into main stream it will have to be regulated and it will.


----------



## Duke of Marmalade

tecate said:


> Dukey's intrinsic value card is increasingly becoming a moot point. It's neither here nor there if bitcoin is being accepted as a store of value. Here is Robert Caplan, President of the Dallas Federal Reserve Bank saying "it's clear, bitcoin is a store of value'. That - from a central banker.


Here we go again.  How can two people see the same interview and draw opposite messages?
Sure he says bitcoin currently has a store of value aspect.  Doesn't even Devil Roubini concede that?  Heck, put a bitcoin in my pocket, I sure ain't goin' to throw it away.
But he clearly identifies that key word "adoption" as meaning adoption as a medium of exchange just as John Kelleher before him.  He observes that the volatility is an impediment to that adoption.
He says CBDC will not be a SoV.  I have been pointing this out in my recent posts.  In fact it is a virtue of CBDC in its role as  MoE that it would not have (hoardable) long term SoV.
Sure he says that as a central banker he is looking at bitcoin and CBDC.  As @Jim2007 says, he is looking and as soon as he sees people buying bars of soap with it, he will smash it.

Just noticed a bar of soap has jumped 8% in btc price in the last 24 hours.


----------



## WolfeTone

Jim2007 said:


> If the Fed/ECB/BIS were to issue instructions for banks to stop the conversion of bitcom, how long to you think it would take for it to hit the floor?



I'm not sure how long it would take. I'm not sure it would hit the floor. 



Jim2007 said:


> Most of the holders are not 'believers' and they will jump at the first sign of trouble...



But if CB's were to issue instructions to stop the conversion to bitcoin (I making the assumption _from_ bitcoin also), where will they jump to?


----------



## tecate

Jim2007 said:


> So long as the general public can't walk into a shop and buy a bar of soap with bitcoin it remains very vulnerable.


It's price remains vulnerable - sure (regardless of whether you consider it in terms of a means of exchange/settlement layer/hedge/store of value use case). As it continues to establish network effect, overall vulnerability declines.



Jim2007 said:


> If the Fed/ECB/BIS were to issue instructions for banks to stop the conversion of bitcom, how long to you think it would take for it to hit the floor?  Most of the holders are not 'believers' and they will jump at the first sign of trouble... and once the race to the bottom begins....  With it all being so automated, I'd give it an hour.


I've always said that if there's a full court press, then that will be an extremely bad day for those that speculate on the asset. However, they won't kill it. They will set its development back a number of years - but its something that I don't believe they will win in the long term.



Jim2007 said:


> But it is no more being used as a store of wealth than the tulips were...  it's value is primarily driven by fear and greed.


Jim, hardly anyone ever tries to label it with the whole tulips deal anymore - and for good reason. They're in no way comparable. Whether people like it or not, unlike tulips, bitcoin possesses a number of the key characteristics of a store of value and  a means of exchange. Other than that, I disagree re. it not being used as a store of wealth. It's formative in that role, yes - but its made significant advances in establishing that use case over the last few years.  You've just heard the President of the Dallas Fed state that it IS a store of value. CB'ers are the antithesis of crypto-friendly folk - so that's significant.
Now alongside that, does there continue to be a major element of speculative interest - driven by fear and greed? Absolutely - I agree - all day long.



Jim2007 said:


> And the minute if ventures into main stream it will have to be regulated and it will.


I don't think that anyone has suggested otherwise. There are going to be major battles over this for years to come. Someone suggested a few weeks back here that the likes of Legarde et al can 'strip away the attributes that make it an asset'. That - they can't do. They can do a full court press re. banning the on and off ramps but they should have a mind to be careful. As network effect expands (and year on year, that's undeniable) - they're going to be stepping on more and more toes....to a point where their shenanigans become politically  unacceptable. They can drive it underground and yes, set it back years but also they lose all control over it.
This thing has many twists and turns to take yet - it's not straightforward by any means - but with every passing day, it's becoming much more difficult for them to tame.




Duke of Marmalade said:


> Here we go again.  How can two people see the same interview and draw opposite messages?


You're absolutely right, Duke. Here we go again - with your bad takes.



Duke of Marmalade said:


> Sure he says bitcoin currently has a store of value aspect.


That's a lie. You're deliberately twisting things. I quoted what he said which was this ->_ "it's clear, bitcoin IS a store of value"_.
There was no mention of 'currently' (as if to infer that bitcoin's store of value attribute is just a transitory phase).



Duke of Marmalade said:


> Heck, put a bitcoin in my pocket, I sure ain't goin' to throw it away.


Don't worry Duke - there are eight decimal places when it comes to bitcoin. You'll need to make use of that feature by the time you cotton on to the world changing around you.



Duke of Marmalade said:


> But he clearly identifies that key word "adoption" as meaning adoption as a medium of exchange just as John Kelleher before him.  He observes that the volatility is an impediment to that adoption.


Back up the bus. You went back and forth for months saying that bitcoin couldn't establish itself as a store of value without first establishing itself as a means of exchange. Here you have the Dallas Fed President/CEO saying that it IS a store of value today - yet he mulls over what implications that has in efforts to use it as a means of exchange.
That all makes perfect sense to me. Remember, nobody here has disputed that it has a number of challenges to overcome when it comes to use as a means of exchange.
However, you do have a major bone to pick with Kaplan as it's clear that he completely disagrees with your assessment that bitcoin can't become a store of value without first being adopted as a means of exchange (given that he explicitly states that it IS a store of value today).




Duke of Marmalade said:


> Sure he says that as a central banker he is looking at bitcoin and CBDC.  As @Jim2007 says, he is looking and as soon as he sees people buying bars of soap with it, he will smash it.
> 
> Just noticed a bar of soap has jumped 8% in btc price in the last 24 hours.


No. You're now visualising what you WANT to happen. Whilst that's what I would expect from most CB'ers that's not the line that he has taken or expressed here.
Secondly, you should note that when he considers bitcoin's shortfalls as a medium of exchange, he does something that no crypto-naysayer here ever does - he's open to that situation changing. He states "that can change and that will evolve".

Clearly you're salivating at the notion of a total crypto ban Duke. However, note that as network effect continues to grow, the task of putting that genie back in the bottle becomes harder and harder.


----------



## Duke of Marmalade

WolfeTone said:


> But if CB's were to issue instructions to stop the conversion to bitcoin (I making the assumption _from_ bitcoin also), where will they jump to?


Nice one!  Every _to _has a twin _from_.
The CB are not terribly exercised by the SoV aspect of btc or indeed speculation thereof.  They would be concerned if it began to be "adopted" meaning used as MoE.  It would be very easy to shut it down as a mass adopted MoE.  It will therefore never achieve that status and as John Kelleher argues, it will never achieve the MoE utility value to justify its current speculative SoV.


----------



## tecate

Duke of Marmalade said:


> , it will never achieve the MoE utility value to justify its current speculative SoV.


And yet you've just heard the President/CEO of the Dallas Fed state explicitly that it already IS a store of value. Go figure...


Duke of Marmalade said:


> Nice one!  Every _to _has a twin _from_.
> The CB are not terribly exercised by the SoV aspect of btc or indeed speculation thereof.  They would be concerned if it began to be "adopted" meaning used as MoE.  It would be very easy to shut it down as a mass adopted MoE.  It will therefore never achieve that status and as John Kelleher argues, it will never achieve the MoE utility value to justify its current speculative SoV.


Try this on for size, Dukey.  It just has to continue to stick around and increase its network effect. It's probably just as well that it's challenged as a means of exchange. It establishes itself as a store of value - whilst a number of the issues surrounding its use as a means of exchange get addressed and there comes a point where they can't turn that clock back. If people have a use case to utilise any digital asset (not just bitcoin), then they will likely end up transacting it also - to some extent as it will be easy to do so.
You've read _The Internet of Money_, I believe? Within it, Antonopoulos envisages a scenario where we all have digital wallets and in a transaction between two parties, those digital wallets will automatically negotiate the transfer of value depending on what digital assets/currencies are available and the preferences of each user (their order of preference in terms of what currency they'd like to send/receive). That's where we're headed.


----------



## WolfeTone

Duke of Marmalade said:


> As @Jim2007 says, he is looking and as soon as he sees people buying bars of soap with it, he will smash it.



The day that people are using bitcoin to buy bars of soap is the day that the volatility in currency rests in the dollar, euro, yen or whatever currency, not bitcoin.

Bitcoin will only start to replace fiat currency, in my opinion, when it has a more stable value than fiat itself. Attempts to 'smash' bitcoin at that point will be futile.
This is point seems lost on you.

It is no secret that we are in an era of unprecedented money printing. History informs us that rapid expansion of the money supply can, and does, lead to instability. How that instability manifests itself, and the consequences are unknown.
There is a clear correlation between the creation of bitcoin and the collapse of the banking system in 2007-2009 (saved only by the magic money tree). The collapse in house prices, unemployment, emigration, spiralling debt rates etc were the consequences felt in this country. So much so that hundreds of thousands of people came out on to the streets to stop water charges. Signaling to government that people were starting to feel they were being pushed too far.
Charges were abandoned and with troika supports and some belt-tightening, calm and order prevailed, notwithstanding the crisis that remained in housing.

The point being, when a monetary system becomes unstable nobody knows what the consequences will be, or how those consequences will manifest themselves.
All we know, with a large degree of certainty, is that there will be consequences to all this money printing.
Who knows, the consequences could be positive? And the good ship global economy returns to safer, chartered waters and we can all chill out. CBs like to give out the impression that we can trust them to do exactly that.

On the other hand, there may be choppy, uncharted waters ahead. In which case, the variable interest rate on my mortgage may shoot up, or perhaps the govt raids my pension scheme, or they increase taxes on my income, insurance premiums rise, etc...etc...maybe the bar of soap rises 8% in a day, then 20% the next day, then falls 10% the day after, etc - in which case,  retailers and consumers may look to something that, at that point, has more stability, more value, than the prevailing fiat currency.
It may, or may not be bitcoin, but at least anyone who holds bitcoin will have that choice. And that is a sentiment that is increasing, observable by virtue the price rise of bitcoin over the last decade.


----------



## WolfeTone

Duke of Marmalade said:


> It would be very easy to shut it down as a mass adopted MoE



No it will not. How would it be easy?
I take it that CBs are not going to be too concerned if I am swapping some satoshis over a few horse bets and pints with lads in the pub?
You are clearly signaling a period of time where increasingly retailers and consumers are using bitcoin instead of the prevailing fiat currency.
In what type of economic circumstances do you think that would occur?
Once you have answered that, ask yourself how easy would it be to stop it?


----------



## Duke of Marmalade

@tecate I am not going to engage in silly semantic gotcha points like he uses the word "IS".
My position is perfectly logical, stop picking at its semantics.
I believe that bitcoin currently has/IS a store of value - proof, I wouldn't throw it away if I was gifted it.
As with John Kelleher, I believe that that SoV can only be justified long term if it achieves some utility value.  The only utility that it can achieve (per JK) is as a MoE.  That won't happen because if it even threatened to happen the authorities, in the interests of society, would nip it in the bud.
Meanwhile its SoV is purely based on speculation.


			
				Wolfie said:
			
		

> Bitcoin will only start to replace fiat currency, in my opinion, when it has a more stable value than fiat itself.


Well now what does more stable value mean?  Bitcoin has fallen 8% in the last 24 hours.  But wait a minute that means the dollar jumped 8%.  Which is the unstable one?  The answer is obvious, how has the price of a bar of soap moved in the respective currencies?
I can never see a day being allowed to happen when bars of soap are priced in bitcoin and their dollar/euro values are all over the shop.


----------



## Duke of Marmalade

WolfeTone said:


> No it will not. How would it be easy?


Do you know what mass adoption as an MoE looks like?  Of course you do.  Walk around Dunnes Stores.  € prices scream at you everywhere.  By mass adoption as a MoE I mean that a substantial section of the population think bitcoin.  They at least want DS to display dual pricing.  You don't think the authorities can stop that happening?
And while we are on the point, the higher the speculative price of bitcoin the greater is the requirement for mass adoption as an MoE to justify that speculation, as per JK.


----------



## tecate

Duke of Marmalade said:


> @tecate I am not going to engage in silly semantic gotcha points like he uses the word "IS".
> My position is perfectly logical, stop picking at its semantics.
> I believe that bitcoin currently has/IS a store of value - proof, I wouldn't throw it away if I was gifted it.


Of course you're not - because what you did was wrong in trying to twist what he _actually _stated.



Duke of Marmalade said:


> I believe that bitcoin currently has/IS a store of value - proof, I wouldn't throw it away if I was gifted it.
> As with John Kelleher, I believe that that SoV can only be justified long term if it achieves some utility value.  The only utility that it can achieve (per JK) is as a MoE.  That won't happen because if it even threatened to happen the authorities, in the interests of society, would nip it in the bud.


Yeah - this is YOUR view - that's not the view that Robert Kaplan of the Dallas Fed stated (which is what you were trying to claim).



Duke of Marmalade said:


> Meanwhile its SoV is purely based on speculation.


So you're saying that people have speculated on its development as a store of value and that Kaplan - as Dallas Fed President - is the latest in a long and growing list of notables that acknowledge that it IS a store of value?  Yeah, that sounds about right.




Duke of Marmalade said:


> Bitcoin has fallen 8% in the last 24 hours.  But wait a minute that means the dollar jumped 8%.  Which is the unstable one?  The answer is obvious, how has the price of a bar of soap moved in the respective currencies?
> I can never see a day being allowed to happen when bars of soap are priced in bitcoin and their dollar/euro values are all over the shop.


And the difference between your take and Kaplan's is that you say its volatile - so that's it - its done for as a means of exchange - no further discussion required. Kaplan specifically referenced bitcoin's volatility as a difficulty for its use as a means of exchange. However, he acknowledges that that 'may change and that will evolve'. He does. You don't.


----------



## tecate

Duke of Marmalade said:


> Do you know what mass adoption as an MoE looks like?  Of course you do.  Walk around Dunnes Stores.  € prices scream at you everywhere.  By mass adoption as a MoE I mean that a substantial section of the population think bitcoin.  They at least want DS to display dual pricing.  You don't think the authorities can stop that happening?
> And while we are on the point, the higher the speculative price of bitcoin the greater is the requirement for mass adoption as an MoE to justify that speculation, as per JK.


Store of value -> Means of Exchange -> Unit of Account. 
You've jumped all the way through to unit of account with the above. You can have everything priced in euros/dollars, etc. and still have a scenario where payment is accepted in bitcoin at the checkout.


----------



## WolfeTone

Duke of Marmalade said:


> The answer is obvious, how has the price of a bar of soap moved in the respective currencies?



Yes, as of today. But you are not considering, or deliberately avoiding the other scenario. 
Where the price of soap, increasing 8% a day (or month, or year) against the dollar, in line with (or close to) bitcoin also increasing 8% against the dollar every day, month or year. 
If such a correlation were to occur, for an sustained (undefined) period, retailers and consumers will move to using bitcoin instead of the prevailing fiat currency to buying and selling soap. 
This is not speculation, it is what would happen in such circumstances. 



Duke of Marmalade said:


> By mass adoption as a MoE I mean that a substantial section of the population think bitcoin.



Yes. Think about it, a substantial section of the population thinking in Bitcoin, how do the authorities stop the population "thinking bitcoin"? 



Duke of Marmalade said:


> You don't think the authorities can stop that happening?



Possibly, but possibly not. 
We are a generally law-abiding people. That said, there are always people trying to circumvent, alter, avoid the laws and customs we hold. But generally, the numbers of those people are insufficient to affect change. 
Occasionally however, the opposite occurs. I refer again to the water charges. The authorities tried to bring in charges spending millions on meters for every household. And of course there were the people who protested against the charges, as always. 
But because a _substantial section of the population _were thinking "I won't pay water charges" the authorities could not implement and enforce the scheme. The authorities were powerless to stop it. 

If a substantial section of population are thinking bitcoin the authorities may be able to stop it, but there is also a tipping point (undefined) where it will be futile to try stop it. Good luck to whoever has that job in knowing when to clamp down and stop people "thinking bitcoin".


----------



## tecate

WolfeTone said:


> If a substantial section of population are thinking bitcoin the authorities may be able to stop it, but there is also a tipping point (undefined) where it will be futile to try stop it. Good luck to whoever has that job in knowing when to clamp down and stop people "thinking bitcoin".


So if there was growing adoption of bitcoin for store of value/investment purposes and your government came along and banned on/off ramps - tanking the price, you'd be more than a tad, annoyed, correct?  If that grouping of people continues to grow year on year, does there come a point at which .gov droids won't dare touch it - as the backlash will be too much?
If they already have crypto and if there's yield to be gotten within the crypto-eco system, maybe they'll say screw your ban - I don't want to take my funds out of that system - go fish.


----------



## WolfeTone

Duke of Marmalade said:


> And while we are on the point, the higher the speculative price of bitcoin the greater is the requirement for mass adoption as an MoE to justify that speculation, as per JK.



I kind of agree with this, but I think it is incomplete.
The higher the price of bitcoin suggests more and more people acquiring bitcoin.

More and more people acquiring bitcoin brings forth the day, or a tipping point, when people begin to exchange bitcoin with each other for goods and services.

The amount of people I know personally who hold bitcoin is 1 other. That is not to say that people I know don't have bitcoin, but just that I don't know if they have it or not.
But if the substantial numbers of people were "thinking bitcoin", it would become apparent soon enough. Thus inducing people to consider trading in Bitcoin.

It reminds me of FB. I thought nothing of ever having a FB account. But when it became apparent to me that those around me were communicating through FB, I opened an account and began communicating with them.

There is an obvious difference insofar as it cost nothing to open a FB account, whereas 0.10 of a bitcoin will cost you several thousand.


----------



## WolfeTone

tecate said:


> does there come a point at which .gov droids won't dare touch it - as the backlash will be too much?



Exactly. See how the authorities ran a mile when they tried to cut the old age pension. 
There comes a point, in an open free democratic society, where the authorities are bound to the demands of the population, not the other way round.


----------



## DK123

Re Bitcoin.Difficult to know!.They say that when you can spot a bandwagon it,s already too late! P. S.The also say that the four most dangerous words in investment are "This time its different".Ask Buffett perhaps?.


----------



## Duke of Marmalade

WolfeTone said:


> Yes, as of today. But you are not considering, or deliberately avoiding the other scenario.
> Where the price of soap, increasing 8% a day (or month, or year) against the dollar, in line with (or close to) bitcoin also increasing 8% against the dollar every day, month or year.
> If such a correlation were to occur, for an sustained (undefined) period, retailers and consumers will move to using bitcoin instead of the prevailing fiat currency to buying and selling soap.
> This is not speculation, it is what would happen in such circumstances.


That you think such a scenario is seriously on the cards it explains you diving in at $60k.


----------



## Duke of Marmalade

“Wolfie” said:
			
		

> Yes. Think about it, a substantial section of the population thinking in Bitcoin, how do the authorities stop the population "thinking bitcoin"?


Folk can think what they want even in China.  Try thinking that Dunnes Stores has a bitcoin till.


----------



## Duke of Marmalade

WolfeTone said:


> Exactly. See how the authorities ran a mile when they tried to cut the old age pension.
> There comes a point, in an open free democratic society, where the authorities are bound to the demands of the population, not the other way round.


Dream on.  I can just picture the cultists burning down the central bank.  Would make a great movie.
If Pascal banned BTC tomorrow how many cultists would turn up in Dame Street?  But the fantasy is that there will come a time when they would turn up in their hordes, armed with pitch forks, digital ones of course.


----------



## NoRegretsCoyote

tecate said:


> @NoRegretsCoyote  :  Just so that I fully understand this, the NTMA has never owned and can never own gold or gold ETFs or derivative products - as it's legally precluded from doing so?


My interpretation bof the NTMA's legal investment mandate is that it cannot own an asset like gold.

The Central Bank can and does own gold bars. AFAIK it pays the Bank of England a fee for doing so in its vault in London. I think this whole arrangement is silly, but that's for another thread.


----------



## DazedInPontoon

Duke of Marmalade said:


> Dream on.  I can just picture the cultists burning down the central bank.  Would make a great movie.
> If Pascal banned BTC tomorrow how many cultists would turn up in Dame Street?  But the fantasy is that there will come a time when they would turn up in their hordes, armed with pitch forks, digital ones of course.


We won't burn anything, we'll just leave, either virtually or physically.


----------



## WolfeTone

Duke of Marmalade said:


> That you think such a scenario is seriously on the cards it explains you diving in at $60k.



Are you trying to discreetly offer another price prediction? How have you fared in that regard until now?



Duke of Marmalade said:


> Folk can think what they want even in China.



Yes they can, what is your point? That there are higher authorities geared towards snuffing out these thoughts? 

I think that used to be the way alright, Divorce, Abortion, decriminalisation of homosexuality, same-sex marriage, Playboy magazine (imagine, in 1995, if the zealots had held the line in with the continued censorship of Playboy how they would have coped with the mass proliferation of internet pornography?)




Duke of Marmalade said:


> Dream on. I can just picture the cultists burning down the central bank.



Who is talking about burning down central banks? Au contraire, it is your goodself that is talking up the ease at which central banks and government authorities can snuff out bitcoin. 
If they cannot engineer a 2% inflation rate, which is their bread and butter , forgive me for being a bit skeptical of the high priest and priestess Powell and LaGarde being able to efficiently deal with much else, let alone bitcoin.


----------



## WolfeTone

Duke of Marmalade said:


> If Pascal banned BTC tomorrow how many cultists would turn up in Dame Street?



Zero. I for one would just allow myself a giggle.


----------



## Duke of Marmalade

@WolfeTone Divorce, abortion, SSM, pornography.  I’m in quite a daze.  I was merely questioning the theory that the cult would become so predominant that the authorities would be powerless to stem the cultist tide.  But I really shouldn’t rain on your parade, if that is your fantasy I shouldn’t begrudge you it.


----------



## WolfeTone

Duke of Marmalade said:


> I’m in quite a daze. I was merely questioning the theory that the cult would become so predominant that the authorities would be powerless to stem the cultist tide.



Yes, if u are in a daze, take some time to think about it.

Was it the authorities that bestowed, by way of generous gift to the people, these rights and entitlements?

Or were the authorities simply acting at the behest of the people, a _substantial section of the population,_ facing up to new realities?

The prospect of Pascal banning bitcoin (and this is no slant on Pascal) is close on par with the Archbishop of Dublin calling for the reintroduction of the ban on the sale of Playboy in 2021.
In other words, if central banks and governments want to stop increasing numbers "thinking bitcoin", my view is that they should have done it around 5yrs ago, or more.

You think otherwise, you think it will be easy for them to crush bitcoin. I do not.


----------



## tecate

DK123 said:


> xRe Bitcoin.Difficult to know!.They say that when you can spot a bandwagon it,s already too late! P. S.The also say that the four most dangerous words in investment are "This time its different".Ask Buffett perhaps?.


Warren Buffett - the oracle of value investing - has to be respected...no doubt. However, you need to bear in mind that by his own admission, he's been slow to understand and recognise the potential in technology-based plays. As a classic example, you should note that Berkshire only took a position for the first time in one of the FAANG stocks in 2016! He's come out and said that he got this wrong. He missed out on a whole wave of innovation as a consequence.

As regards thinking you're too late, there's some merit to that argument. However, if we consider Amazon, over a period of 12 years, many investors felt they had missed out. Yet, the stock on average - increased by 175% per year. I think that we're still in the early days of blockchain/crypto/bitcoin. However, it does run on cycles and we're in the bull market phase of this current cycle. That said, if you allocate on the basis of no more than a couple of percent - and if you were to start to put that together by dollar cost averaging over a long timeframe, then you're going to get exposure to this asymmetric risk without the chance that it will destroy your portfolio.

Over the course of four years of discussion on here, bitcoin/crypto has been likened to what happened in the dot com boom/bust. I certainly think that most crypto projects will vapourise - just like a plethora of startups did back then. However, just like the FAANGs emerged from that time, there will be category winners in crypto likewise. The example has been given as a negative but what came out of the dotcom boom changed life for everyone on the planet forever - and created tech giants. Again, should people not have had a small degree of exposure back then - and should they not right now when it comes to bitcoin/crypto?

I'll leave you with this...

Amazon has had similar 50% plus corrections yet from year 13 until year 24, it increased 62x in value.


----------



## Duke of Marmalade

So _Wolfie_ that’s your credo.  Bitcoin is in there with divorce, abortion and pornography blazing the trail for human freedom.  And I thought @tecate was a cultist!


----------



## WolfeTone

@Duke of Marmalade , I think you have awoken out of your daze now?

It has become apparent to you now that if a substantial section of the population have a vested interest in bitcoin, then the CB's and governments can try to ban, disrupt, interfere all they want, it is not going to be easy to 'smash' bitcoin.


----------



## Duke of Marmalade

For how many people in Ireland today is bitcoin their transactional currency of choice?  I would say precisely zero.  The current price of bitcoin will be justified long term if around 10% of the world’s population used bitcoin as their transactional currency, per JK.
I agree that if 10% of folk used bitcoin as their transactional currency, possibly including some cabinet ministers, it would be politically difficult to stamp out.  It will never happen, never mind never be allowed to happen.  But there I go raining on the cultist fantasy.


----------



## WolfeTone

Duke of Marmalade said:


> It will never happen



If it is never to happen, then there is never a need for governments and cb's to stamp out bitcoin. 

But I am open to the possibilty that it _may_ happen, not that it will happen or will not happen.



Duke of Marmalade said:


> never be allowed to happen



which, quite spectacularly at this stage, misses the point once more about where authority actually derives from. In your own words;



Duke of Marmalade said:


> I agree that if 10% of folk used bitcoin as their transactional currency, possibly including some cabinet ministers, it would be politically difficult to stamp out.


----------



## Duke of Marmalade

WolfeTone said:


> If it is never to happen, then there is never a need for governments and cb's to stamp out bitcoin.
> 
> But I am open to the possibilty that it _may_ happen, not that it will happen or will not happen.
> 
> 
> 
> which, quite spectacularly at this stage, misses the point once more about where authority actually derives from. In your own words;


I was conceding that at 10% adoption it would be politically difficult to ban.  I therefore opined that the monetary authorities would ensure that such a situation would not arise, by stepping in much earlier; that is their mandate to preserve monetary stability.  To date they have not seen the need to take that step although it has been mooted, but as that Dallas chap observed adoption as a currency is negligible, so they see no reason to interfere with the casino.  Do I have to draw diagrams?


----------



## WolfeTone

Duke of Marmalade said:


> but as that Dallas chap observed adoption as a currency is negligible, so they see no reason to interfere



Yes, so all of the bluster to date about central banks stamping out bitcoin have been just that, bluster.

Only if there is consequential adoption of bitcoin as a MoE will CB's and governments feel compelled to intervene. 

But as stated before, in my opinion, bitcoin will only ever be adopted as a MoE when the prevailing economic circumstances make it more beneficial to retailers and consumers to use it rather than the existing fiat currency. Those circumstances, generally speaking, will involve a sustained period of instability in the existing currency, combined with a significant section of the population already holding bitcoin. 
For example, imagine if somewhere like Greece decides they are out the euro, in turn, causing a chain of events, unintended, that destabilises the euro.
Or, as the repercussions of Brexit take hold, other European countries follow UK and exit it out of the EU heralding a chain of events, unintended, that destabilises the political and economic environs of Europe.
You may consider such circumstances as highly unlikely or will never happen, or more apt from your outlook, will "never be allowed to happen". 
Im a bit more circumspect, and my outlook is that no-one knows what will happen, other than anything can happen.

As it stands, as bitcoin price climbs higher and higher, it is signifies to me increasing interest in bitcoin. More and more people holding bitcoin. But as you say, if it is not in use as MoE then CB's need not fuss themselves over this. 
But if a sustained period of instability and volatility were to emerge in the CB issued currency, then retailers and consumers will move to use alternative means to exchange goods and services if it is in their clear interest to do so. At which point, it may be too late for CB's and governments to intervene. 

It may never happen. Cb's and governments may restore European and global economies and monetary systems to rude health and momentum for bitcoin may diminish.
On the other hand, Europe of all places is, historically speaking, synonymous with instability. 
I just think at this stage it is wise to hold some bitcoin, for whatever happens.


----------



## Duke of Marmalade

@WolfeTone At last you have seen the point I was making.  You have in turn described circumstances where bitcoin would usurp fiat as the currency of choice for the woman on the 46a.  It would need a realistic prospect of such an outcome to justify its $60k price tag and what's more I can't really see what has happened in the last 12 months to increase the chances of such scenarios 10 fold.  Note that gold is the same price today as 12 months ago and surely gold would also benefit from the fiat meltdown you await.
@tecate I don't know whether you bet horses.  But take High Definition.  It is currently priced at 4.1 on Betfair to win the Epson Derby.  Now High Definition is a very good Store of Value whilst that speculation persists, it can be traded every minute of the day.  However, come the first week in June we will know whether that speculation was justified and its SoV will either multiply and crystallise or vanish.
In a similar way the bitcoin price is a speculation that one day it will be a meaningful medium of exchange (John Kelleher, see below).  It therefore has/IS SoV material whilst the speculation is alive.  Unlike the derby we do not have a definite time limit for knowing whether the speculation was justified.  But, and this is the John Kelleher point, it can only be a SoV if it achieves meaningful utility as a MoE or if it maintains speculation that this might occur.  It can never be a SoV in its own right absent of being a meaningful utility or the speculative possibility of becoming such.

I think at this stage I should remind folk of the words of my oft cited John Kelleher.


			
				John Kelleher of Investopedia said:
			
		

> One of the biggest issues is Bitcoin's status as a store of value. *Bitcoin's utility as a store of value is dependent on its utility as a medium of exchange.* We base this in turn on the assumption that for something to be used as a store of value it needs to have some intrinsic value, and *if Bitcoin does not achieve success as a medium of exchange, it will have no practical utility and thus no intrinsic value and won't be appealing as a store of value*.


The bold highlighting is mine.  Please note that JK is a huge fan of bitcoin and does think it will make it as an MoE.  In fact he predicts a price of $514k based on his estimated adoption rate.


----------



## WolfeTone

Duke of Marmalade said:


> Note that gold is the same price today as 12 months ago and surely gold would also benefit from the fiat meltdown you await.



Gold has been around for thousands of years. My mother has known about gold since she was about 6yrs old. She understands the concept of it holding value since she was about 6yrs old.
Bitcoin has been around for 11yrs or so. My mother knows about bitcoin since about 3-5yrs ago. My mother still has no idea what bitcoin is.
Gold is a price corrupted manipulated market.

Gold price manipulation is real 

"_I think it’s the largest fine that’s ever been paid for spoofing and market manipulation in this particular order and really sets a massive precedent,” Rhind said.

Regulatory changes are likely _[but not certain]_ to follow after this case, Rhind added.

“*Hopefully *it doesn’t happen again. $920 million is not a small amount, even for a bank of the size of JPMorgan. I’m sure you will see wholesale changes made on the compliance side and all sorts of other controls put in place to make sure that this doesn’t happen again,” he said._



Duke of Marmalade said:


> I can't really see what has happened in the last 12 months to increase the chances of such scenarios 10 fold



More and more people are holding bitcoin (signaled by its increasing price) as they begin to understand what it is, or are at least trying to understand what it is. However, Bitcoin remains very much on the periphery of the day-to-day lives of the men and women on the 46A. It is much more prevalent with people working in the financial and tech sectors, but even there I suspect it is still a minority concept?
How long before that prevalence expands into wider general acceptance across the public at large?
It may never happen, but if it does, $60,000 will be bargain basement.


----------



## tecate

Oh no, Dukey has taken us into the JK loop. You're obviously a fan Duke. I think it's time for an experiment though. When JK states the following, are you supportive and in agreement:

_"Crypto will unbank the banked"_


----------



## WolfeTone

Duke of Marmalade said:


> I think at this stage I should remind folk of the words of my oft cited John Kelleher.



I will let @tecate speak for him/herself. But if I'm correct, it is that tecate has pointed out to a Central Banker that has confirmed, in his view, that bitcoin is a SoV without it being dependent on becoming a MoE.


----------



## tecate

WolfeTone said:


> I will let @tecate speak for him/herself. But if I'm correct, it is that tecate has pointed out to a Central Banker that has confirmed, in his view, that bitcoin is a SoV without it being dependent on becoming a MoE.


He's just one in a long notable line of folk that have done so, Wolfie. I thought the Duke would be impressed - as CB'ers are like high priests to the Duke. He told us once before that he would always trust them. It was clearly a mistake as the whole thing has set him off on a John Kelleher Loop. Those episodes tend to last a few weeks so brace yourself.


----------



## Duke of Marmalade

WolfeTone said:


> I will let @tecate speak for him/herself. But if I'm correct, it is that tecate has pointed out to a Central Banker that has confirmed, in his view, that bitcoin is a SoV without it being dependent on becoming a MoE.


@tecate has also pointed out that Devil Roubini has stated that bitcoin is a SoV.  This very Duke has conceded that bitcoin* IS* a SoV.  So too is a bet on High Definition for the Epsom Derby.  What is at stake is why is it a SoV and for how long is that reason sustainable.  @tecate is trying to make SoV some sort of existential quality.  A pig is a pig is a pig.
Let me try and explain the conditionality and temporal nature of some of our SoV assessments.  I will draw diagrams using my own good self as an example.  Imagine I found a bitcoin in my pocket.  But I am told the private key will follow in a month's time.  How much would I sell my bitcoin to @tecate for?  I would certainly accept $60k and refuse $100, but $30k??  But if the private key will be posted in 10 years time, I'd probably take the $100.  I think Devil Roubini would use similar metrics.
JK sees its value in 10 years time as highly contingent on its achieving MoE maturity, but if I read him correctly he thinks that is going to happen and probably wouldn't accept $60k (presuming it comes with a solemn undertaking not to buy another bitcoin of course).
Dallas Man?  He hasn't opined one way or another on JK's axiom, unless he has communicated separately to your good self dear _Wolfie _on the point*.  I am not sure how much Dallas Man would accept today for a 10 year realisation of a bitcoin.

*  I note your trick with the word "without".  It does not imply that he rejects the thing that it is "without".


----------



## tecate

Duke of Marmalade said:


> @tecate is trying to make SoV some sort of existential quality.  A pig is a pig is a pig.


Get out of it Duke. You spent years crying about 'no intrinsic value' this and  'no store of value' that. There are pages worth of posts from you where you deny that it is a store of value.
You had to change your tune when that clown Roubini tried to walk it back with his admission that bitcoin is a store of value only to go back to classic Roubini rant mode once more because it will be a cold day in hell before the crypto community let him walk it back. They will never let it down.




Duke of Marmalade said:


> if the private key will be posted in 10 years time, I'd probably take the $100.  I think Devil Roubini would use similar metrics.


You need not worry about it Duke. You'll never own a complete bitcoin - by the time you accept that the world has changed around you, you'll be lucky to be able to get your hands on a fraction of a bitcoin.




Duke of Marmalade said:


> Dallas Man?  He hasn't opined one way or another on JK's axiom, unless he has communicated separately to your good self dear _Wolfie _on the point*.  I am not sure how much Dallas Man would accept today for a 10 year realisation of a bitcoin.


Kaplan as CEO of the Dallas Fed - expressed his own opinion. You've tried to twist it this way and that and yet what remains is that he confirmed his view that bitcoin IS a store of value.  That's where it ends.

BTW, I'm still waiting for an answer re. post # 101 above. In your own time.



Duke of Marmalade said:


> *  I note your trick with the word "without".  It does not imply that he rejects the thing that it is "without".


@WolfeTone : What's this stunt you've pulled??


----------



## WolfeTone

I'm somewhat reluctant to take the deep dive into the the gospel according to JK.
I've highlighted in bold the part that I think really matters, which incidentally is not the part that @Duke of Marmalade highlights.

JK
_"Bitcoin's utility as a store of value is dependent on its utility as a medium of exchange. *We base this in turn on the assumption that for something to be used as a store of value it needs to have some intrinsic value*, and if Bitcoin does not achieve success as a medium of exchange, it will have no practical utility and thus no intrinsic value and won't be appealing as a store of value."_

JK is a smart fella no doubt, but he is simply offering an opinion. That opinion holds merit, but it doesn't necessarily hold true.
I have mentioned, in my opinion, the conditions and circumstances that I consider bitcoin may become a mainstream MoE. I do not assume however, unlike JK, that it must become a MoE to have any practical utility.
Bitcoin already serves a practical utility insofar I have somewhere to place surplus income that I consider will hold greater value than if I left it on bank deposit. This is speculative, but it is a practical utility, same as if I had the same view about gold and bought some.

But I think we have been through the intrinsic value/ gold debate, so I will park that up here.


----------



## Duke of Marmalade

tecate said:


> BTW, I'm still waiting for an answer re. post # 101 above. In your own time.


_Crypto will  unbank the banked?_ I hardly even know what it means. Does he mean me? There is an awful lot of what JK says that I disagree with including his prediction of a $514k price for bitcoin. But my repeated citations of that central axiom are in a way me quoting scripture.


tecate said:


> @WolfeTone : What's this stunt you've pulled??


You know what I meant.  To be fair to _Wolfie _he hasn't  risen to your bait.
But just to spell it out.  _Wolfie_ took the absence of the JK Axiom in Dallas Man's comment to imply that he, DM, didn't accept that axiom.  I suppose that is borderline fair debating tactic.
But there are lots of conditionality that was left out and which I presume even the cult accepts are present e.g.
That another crypto usurps bitcoin
That quantum computing dismantles the elliptic cryptography
That scalability is not satisfactorily addressed
That Central Banks act successfully to suppress it
That Elon Musk gets tired of it and moves on to another toy
etc. etc.


----------



## tecate

Duke of Marmalade said:


> You know what I meant.  To be fair to _Wolfie _he hasn't  risen to your bait.
> But just to spell it out.  _Wolfie_ took the absence of the JK Axiom in Dallas Man's comment to imply that he, DM, didn't accept that axiom.  I suppose that is borderline fair debating tactic.
> But there are lots of conditionality that was left out and which I presume even the cult accepts are present e.g.
> That another crypto usurps bitcoin
> That quantum computing dismantles the elliptic cryptography
> That scalability is not satisfactorily addressed
> That Central Banks act successfully to suppress it
> That Elon Musk gets tired of it and moves on to another toy
> etc. etc.


What are you going on with? You'll twist and turn every which way to not accept what he stated. Whether you like it or not, that IS what he stated...i.e. Bitcoin IS a store of value.


----------



## tecate

SPC100 said:


> I heard Tesla was going to pay it's tax bill in btc.


I guess WeWork are thinking along the same lines as it too is now accepting crypto for its offerings. It said that it's  going to hold that crypto on its balance sheet. Coinbase has confirmed it will pay for WeWork services in bitcoin. Taking it a step further still, WeWork will pay landlords and third parties in crypto if it can.

Meanwhile, US mobile payments service Venmo began offering the ability for its 77 million customers to buy/sell/hold bitcoin today.


----------



## SPC100

My Tesla quote was meant as a joke!


----------



## tecate

SPC100 said:


> My Tesla quote was meant as a joke!


Well aware of that.


----------



## Leo

6 pages in and no one has even mentioned the state that is already heavily invested....North Korea!


----------



## Firefly

OK...I'm gonna put my conspiracy hat on...

For years Russia is totes annoyed at the might of the greenback, and has been, for decades, trying to upset the status quo. However, now Russia is also totes annoyed at the might of the euro. It's just not fair on poor, misunderstood Russia. But all of a sudden a mysterious crypto "currency" emerges and Russia thinks "У меня будет немного этого". Russia must be having monetary wet dreams at the prospect of something like Bitcoin coming along like a cat among the pigeons. They could get everything they wished for without doing anything to make it work! Ditto for North Korea....like manna from heaven really. 

So....with my conspiracy well secured....maybe Russia and North Korea are pushing Bitcoin? Maybe communism-loving tecate & wolfie have slurped the Kool-Aid and will try any argument they can think of to legitimize Bitcoin for as many uses as possible. Afterall, if countries did by Bitcoin, wouldn't that mean less reliance on the dollar/euro? Wouldn't that just be dandy?!

The hat was getting a bit tight, so I've removed it now..


----------



## Duke of Marmalade

@Firefly Big flaw in your conspiracy theory.  Putin is a smart guy.


----------



## WolfeTone

Duke of Marmalade said:


> @Firefly Big flaw in your conspiracy theory.  Putin is a smart guy.



Reds under the bed!


----------



## WolfeTone

Firefly said:


> They could get everything they wished for *without doing anything* to make it work





Firefly said:


> maybe Russia and North Korea *are pushing* Bitcoin



I think I may have discovered a fundamental flaw in your conspiracy theory!


----------



## tecate

Leo said:


> 6 pages in and no one has even mentioned the state that is already heavily invested....North Korea!


I'm disappointed. You've left out Iran, Venezuela and Russia.
So your logic is that if something which has utility for ordinary people can possibly be used by anyone you deem to be bad, then we should deprive use of that item for everyone? I'm sorry but I don't agree.

The Americans have weaponised money. You think that they are doing good with this?  I certainly don't. A couple of years ago, they locked Iran out of international banking - against the wishes of the Europeans. They didn't care - they just acted unilaterally.
Next up....give us an example of how sanctions have really been a force for good in the world?  There isn't one! Have you talked to anyone from a sanctions-hit country? ...because I do all the time. In Venezuela, they have a shortage of all manner of things including medical equipment, drugs, etc. A family member of a friend of mine died in Venezuela last year because of a lack of a very basic drug. That death would not have happened had there not have been sanctions. It's one of countless cases of the real effects of sanctions.

What sanctions aim to do is to make life so unbearable for ordinary people that they're forced to rise up against their government. To me that defies human rights. If there is a wayward regime, those people don't suffer under sanctions - but ordinary people do.
Lastly, in cases of errant governments, bitcoin is a force for good.  Bitcoin makes the transportation of money to human rights groups and those that work against oppressive regimes much easier as its very easy to conceal and transmit. It's  the peoples money and a force for good. It's for this reason that bitcoin is supported by the likes of the Human Rights Foundation. When the Americans took the very democratic step of locking Wikileaks out of the financial system (by instructing the likes of visa NOT to process donations from ordinary decent people to the organisation), it was bitcoin that broke that wayward, oppressive action. It's for this reason that Greenpeace accept bitcoin as a payment method - despite this wayward 'boil the oceans' narrative that's doing the rounds re. bitcoin.




Firefly said:


> For years Russia is totes annoyed at the might of the greenback, and has been, for decades, trying to upset the status quo. However, now Russia is also totes annoyed at the might of the euro.


Ah, so you support a system where ONE country comes along and insists that only its currency should be used for international trade? How very democratic. At Bretton Woods the Americans insisted on the use of their currency as an international reserve asset - dismissing Keynes proposal of a Special Drawing Rights based reserve instrument. That - to further their own influence in the world over and above other countries - not for the good of all. Later they pulled the same stunt with the advent of the Petro-dollar ...doing a deal with the Saudi's (to support their wayward regime) in return for the Saudi's pricing their oil in dollars.

You think that its just Russia that has a problem with this system?  There's NO defending it. The world's reserve currency should be entirely neutral. If only there was a currency that was tamperproof and neutral that's easily transmitted and uncensorable that could do the job.....



Firefly said:


> Maybe communism-loving tecate & wolfie have slurped the Kool-Aid


The bad takes continue. I've over 1,200 posts on here. Provide a link to just one that proves I'm a communist. :-D



Firefly said:


> Afterall, if countries did by Bitcoin, wouldn't that mean less reliance on the dollar/euro? Wouldn't that just be dandy?!


It seems to me that your information is incorrect. There is only one world reserve currency - it's the US dollar. The euro isn't the world's reserve currency. Secondly, despite that, the Chinese and Russians have taken to using it in some of their recent trade deals - to try and get out from under the thumb of the US. So where are they rebelling against the Euro? My understanding is that they're disappointed as the Euro project has been a disappointment - and its not as useful for international trade as they'd like it to be (as opposed to the US dollar).


----------



## Firefly

tecate said:


> I'm disappointed. You've left out Iran, Venezuela and Russia.
> So your logic is that if something which has utility for ordinary people can possibly be used by anyone you deem to be bad, then we should deprive use of that item for everyone? I'm sorry but I don't agree.
> 
> The Americans have weaponised money. You think that they are doing good with this?  I certainly don't. A couple of years ago, they locked Iran out of international banking - against the wishes of the Europeans. They didn't care - they just acted unilaterally.
> Next up....give us an example of how sanctions have really been a force for good in the world?  There isn't one! Have you talked to anyone from a sanctions-hit country? ...because I do all the time. In Venezuela, they have a shortage of all manner of things including medical equipment, drugs, etc. A family member of a friend of mine died in Venezuela last year because of a lack of a very basic drug. That death would not have happened had there not have been sanctions. It's one of countless cases of the real effects of sanctions.
> 
> What sanctions aim to do is to make life so unbearable for ordinary people that they're forced to rise up against their government. To me that defies human rights. If there is a wayward regime, those people don't suffer under sanctions - but ordinary people do.
> Lastly, in cases of errand governments, bitcoin is a force for good.  Bitcoin makes the transportation of money to human rights groups and those that work against oppressive regimes much easier as its very easy to conceal and transmit. It's  the peoples money and a force for good. It's for this reason that bitcoin is supported by the likes of the Human Rights Foundation. When the Americans took the very democratic step of locking Wikileaks out of the financial system (by instructing the likes of visa NOT to process donations from ordinary decent people to the organisation), it was bitcoin that broke that wayward, oppressive action. It's for this reason that Greenpeace accept bitcoin as a payment method - despite this wayward 'boil the oceans' narrative that's doing the rounds re. bitcoin.


You know, there has been a few posters knocking around here for years with very similar arguments and viewpoints as your good self. Maybe when these restrictions are lifted you should get together. There's even a thread for such things https://www.askaboutmoney.com/threa...ctions-are-lifted.217460/page-12#post-1715819


----------



## Duke of Marmalade

That's what I mean by a cult.  All the evils of this world can be traced back to America and/or US$.


----------



## tecate

Firefly said:


> You know, there has been a few posters knocking around here for years with very similar arguments and viewpoints as your good self. Maybe when these restrictions are lifted you should get together. There's even a thread for such things https://www.askaboutmoney.com/threa...ctions-are-lifted.217460/page-12#post-1715819


What very similar arguments and viewpoints? My interests don't go beyond discussion of decentralised cryptocurrency on AAM. What on earth is the linked post got to do with this discussion or with me?
Isn't that post regarding covid/vaccination? How is that relevent to this discussion? How is it relevant to me given that I have not expressed ANY view on that subject on AAM?


Duke of Marmalade said:


> All the evils of this world can be traced back to America and/or US$.


I did not say any such thing. I said that it's not healthy that one government should have a monopoly on the terms of international trade.


----------



## Duke of Marmalade

Well _Wolfie _you have the answer to OP.  North Korea, Russia, Venezuela and Iran.  Or did you mean states that we can take seriously?


----------



## Firefly

tecate said:


> My interests don't go beyond discussion of decentralised cryptocurrency on AAM.


The Americans have weaponised money. You think that they are doing good with this?  I certainly don't. A couple of years ago, they locked Iran out of international banking - against the wishes of the Europeans. They didn't care - they just acted unilaterally.
Next up....give us an example of how sanctions have really been a force for good in the world?  There isn't one! Have you talked to anyone from a sanctions-hit country? ...because I do all the time. In Venezuela, they have a shortage of all manner of things including medical equipment, drugs, etc. A family member of a friend of mine died in Venezuela last year because of a lack of a very basic drug. That death would not have happened had there not have been sanctions. It's one of countless cases of the real effects of sanctions.


----------



## Leo

tecate said:


> I'm disappointed. You've left out Iran, Venezuela and Russia.


Really, I didn't realise I was trying to give a list???


----------



## tecate

Duke of Marmalade said:


> Well _Wolfie _you have the answer to OP.  North Korea, Russia, Venezuela and Iran.  Or did you mean states that we can take seriously?


I see you missed out on the sovereign wealth funds of Norway and Singapore - but lets not try and get in the way of the tar and feathering you're trying to achieve, right?  If what you're going on with is correct, why are the Human Rights Foundation supportive of opensource software such as bitcoin?

@Firefly :  Discussed exclusively in the context of bitcoin. Again, I'll ask - what has that to do with the post you linked to in your previous post?

As regards the last post above from the semantics specialist, no comment!


----------



## WolfeTone

Firefly said:


> You know, there has been a few posters knocking around here for years with very similar arguments and viewpoints as your good self.



Surely this point applies to your good self also?


----------



## Firefly

WolfeTone said:


> Surely this point applies to your good self also?


Very true and I've often meant to get up to the big SHMOKE to meet a few of them. Maybe this is the year!!


----------



## WolfeTone

Duke of Marmalade said:


> Or did you mean states that we can take seriously?





Duke of Marmalade said:


> All the evils of this world can be traced back to America and/or US$.



I thought all the evils of this world were to be traced back to Putin, Kim Jong-un and China (sometimes, only when it suits the narrative)

Yeh, I don't take them seriously myself. The US, and the reds-under-bed "_The Russians are Coming!!"  _conspiracy theorists do.


----------



## Duke of Marmalade

tecate said:


> I see you missed out on the sovereign wealth funds of Norway and Singapore


@WolfeTone I'm asking you seriously does this constitute a nation state buying a stake in bitcoin?  For your information:


> The Norwegian Government Pension Fund, also known as the Oil Fund, has over *$1 trillion *in assets, including 1.4% of *all* global stocks and shares.
> Arcane Research analysis data shows that the Norwegian oil fund has 577.6 BTC through its investment in business intelligence firm MicroStrategy. This puts the company’s portfolio in BTC at around *$6.3 million*. The Norwegian Government Pension Fund has a 1.51% stake in MicroStrategy.


That the cults seeks out these irrelevant trivia in its self justification displays a deep seated insecurity.  And they are sure right to feel insecure.

If the above constitutes buying a stake in bitcoin I shudder to think what else it is buying a stake in through its holding of 1.4% of all global stocks and shares.


----------



## tecate

Duke of Marmalade said:


> @WolfeTone I'm asking you seriously does this constitute a nation state buying a stake in bitcoin?  For your information:
> 
> That the cults seeks out these irrelevant trivia in its self justification displays a deep seated insecurity.  And they are sure right to feel insecure.
> 
> If the above constitutes buying a stake in bitcoin I shudder to think what else it is buying a stake in through its holding of 1.4% of all global stocks and shares.


Well done Duke. Wasn't that the whole premise of Wolfie's original post? The assumption was that this type of investment hasn't even started yet? And you say it's very little? I agree. Imagine that bitcoin is now a trillion dollar asset with no offices, no employees, no marketing - no nothing - it's just code.
Imagine what price we'll be at when these guys start to allocate a couple of percent.

You can smell the despair and desperation in your posts, your Dukeness!


----------



## Duke of Marmalade

tecate said:


> You can smell the dispair and desperation in your posts, your Dukeness!


Can't you understand my despair?  I live in dread fear that the cult will uncover that the Pope himself has given bitcoin a blessing through the Vatican's indirect holdings.


----------



## tecate

Duke of Marmalade said:


> Can't you understand my despair?  I live in dread fear that the cult will uncover that the Pope himself has given bitcoin a blessing through the Vatican's indirect holdings.


Yeah, it's all just a fad, right?  That's why these guys have just put $100 million into a blockchain/bitcoin infrastructure company.  

The USD is strewn with religious phraseology and masonic symbolism and on the back of that you'd have us believe bitcoiners are the cultists!  ...lol


----------



## WolfeTone

Duke of Marmalade said:


> I'm asking you seriously does this constitute a nation state buying a stake in bitcoin?



In an indirect way it could be argued that it is a nation state buying a stake in bitcoin. 

But for benefit of any doubt the premise of my OP was nation states acquiring bitcoin directly. 

I have no need to 'seek out' these 'justifications'. I sense you trying to shift the goalposts once more. You once pined for economists who endorse bitcoin. When some were produced they weren't the 'right type' of economist. 
You have propagated the righteousness of the central bankers. But when a central banker gives credence to bitcoin as a SoV, well, its not a SoV that matters its its status as MoE that counts. 
And now, if a nation state has acquired bitcoin they are the type of nation states not to be taken seriously. Or the type of indirect acquiring of bitcoin is a symptom of 'deep seated insecurity'! 

Do you not recognise how shallow the waters are becoming? 

I just think that for any nation state it is an obvious good idea to acquire bitcoin, directly. 
I think it is also only a matter of time too, if it isn't happening already.


----------



## Duke of Marmalade

WolfeTone said:


> You once pined for economists who endorse bitcoin. When some were produced they weren't the 'right type' of economist.
> You have propagated the righteousness of the central bankers. But when a central banker gives credence to bitcoin as a SoV, well, its not a SoV that matters its its status as MoE that counts.
> And now, if a nation state has acquired bitcoin they are the type of nation states not to be taken seriously.


You have summarised my ripostes well.


WolfeTone said:


> Or the type of indirect acquiring of bitcoin is a symptom of 'deep seated insecurity'!


Misreading me again.  I said the irrelevant reference to Norway's very indirect holding of bitcoin as endorsement shows a desperate need for the cultists to seek out  endorsement even where non existent.  I was not suggesting any dsi on behalf of the Norwegian Oil Fund.


WolfeTone said:


> Do you not recognise how shallow the waters are becoming?


I certainly don't feel out of my depth though @tecate has sensed dispair (sic) and desperation on my part.


----------



## WolfeTone

Duke of Marmalade said:


> I was not suggesting any dsi on behalf of the Norwegian Oil Fund.



I know, you were referring to the 'cult'. My bad.


----------



## tecate

@WolfeTone :  You posted originally mulling over _when_ nation states might place some funds in bitcoin. We find that they've already started and the Duke clings to the complaint that its a paltry sum....even though we set off from the premise that such a thing hasn't even started yet. When you take a sip out of your pint, it's still more than half full. When the Duke takes a sip out of his pint,  to his mind the glass is almost empty.


----------



## Duke of Marmalade

@WolfeTone  I have to say that if serious nation states or rather their central banks started to hold bitcoin as part of their currency reserves, that would be a shocker - possibly to the point where I would concede that bitcoin is here to stay.  I don't think it will happen.
The various other "endorsements" don't really impress me.  The introduction of futures.  The facilitation of a section of their customer base by some institutions or payment platforms.   A couple of mavericks like Saylor and Muskie. Norway Oil Fund having a tiny indirect holding.  None of this goes any way to diverting me from the Roubini standpoint.  But (serious) central banks embracing bitcoin - well that would rattle me and Roubini as well I am sure.
For avoidance of doubt I am gobsmacked by the $1tr capitalisation.


----------



## WolfeTone

@tecate Saylor v Guistra. Did you watch? Great stuff.


----------



## tecate

WolfeTone said:


> @tecate Saylor v Guistra. Did you watch? Great stuff.


Yeah, I had it on although busy with other stuff so it didn't have my full attention. Saylor has had a series of uncontested interviews on the subject so good to see. I don't think it's thrown out anything new though.


----------



## WolfeTone

Duke of Marmalade said:


> But (serious) central banks embracing bitcoin - well that would rattle me



Yes of course, it would rattle everyone.

Effectively, an admission that the overseers had lost control and were scrambling to retain control.
My somewhat crude point before, about the Irish Censorship Board permitting the sale of Playboy in 1995, coinciding with proliferation of internet pornography on every computer. Imagine if the overseers of censorship had tried to hold their ground? It would have been farcical.

Central Banks, and their political creators, will not go quietly into the night that is for sure. That is why I think it is a great idea for nation states to start buying bitcoin. Rather than automatically take a hostile position to bitcoin, take a positive position in it.
Bitcoin does not have to be this great threat to the $ or €. The biggest threat to the $ and € is unlimited money-printing based on a stagnant, permanent policy decision of 2% inflation target.


----------



## WolfeTone

tecate said:


> Yeah, I had it on although busy with other stuff so it didn't have my full attention. Saylor has had a series of uncontested interviews on the subject so good to see. I don't think it's thrown out anything new though.



True, nothing new - gold bug, Guistra , bitcoin bug, Saylor.

Here is the thing about Saylor I like. His focus on technology and its impact. I think he is brilliant at this and his insight opens the door to anyone interested in trying to understand what bitcoin, or money, is.


----------



## DublinHead54

NoRegretsCoyote said:


> The NTMA's investment mandate is here. I don't see how a virtual asset that pays no interest that has a material chance of being worth zero in the medium term is consistent with that mandate.


Rate of return is not referring to assets that pay interest only hence the large equity holdings the NTMA hold. I believe that BTC could be purchased by the NTMA in the future following the necessary governance process.


----------



## NoRegretsCoyote

Dublinbay12 said:


> Rate of return is not referring to assets that pay interest


Correct.

Which is why I also said that bitcoin also has "_a material chance of being worth zero in the medium term_". 

The NTMA is obliged to invest to support investment in the state. If that is not available, to invest with the expectation of an appropriate return given the level of risk to the asset


I have no inside knowledge, but I highly doubt the NTMA board would choose to hold bitcoin given the level of risk involved. It would be a pure bet on capital appreciation of a non-interest bearing asset with limited use as a means of exchange in the legitimate economy.


----------



## Duke of Marmalade

WolfeTone said:


> Yes of course, it would rattle everyone.
> 
> Effectively, an admission that the overseers had lost control and were scrambling to retain control.
> My somewhat crude point before, about the Irish Censorship Board permitting the sale of Playboy in 1995, coinciding with proliferation of internet pornography on every computer. Imagine if the overseers of censorship had tried to hold their ground? It would have been farcical.
> 
> Central Banks, and their political creators, will not go quietly into the night that is for sure. That is why I think it is a great idea for nation states to start buying bitcoin. Rather than automatically take a hostile position to bitcoin, take a positive position in it.
> Bitcoin does not have to be this great threat to the $ or €. The biggest threat to the $ and € is unlimited money-printing based on a stagnant, permanent policy decision of 2% inflation target.


I should have recorded the original tired and emotional rant which was right out of the Big Short copy book.
The thread as per usual has drifted into farce.


----------



## WolfeTone

Duke of Marmalade said:


> I should have recorded the original tired and emotional rant which was right out of the Big Short copy book.
> The thread as per usual has drifted into farce.



As yes, it was a bit of a rant indeed, so I edited it.

But the drift into farce started long ago at every corner you skip over ever inconvenient realities that stands in front in you.

BOHA, criminality, Tether, the Russian conspiracy, economists and central bankers endorsing bitcoin, institutional investors adopting bitcoin, the magic money trees that you store so much of your faith in, ....I could on, but hey, I need to be mindful of ranting.


----------



## Duke of Marmalade

@WolfeTone Nevertheless your "true feelings" and those of your fellow traveller @tecate bare stark comparison with the clinical unemotive contributions of @NoRegretsCoyote.  It is clear that bitcoin means much more to the two of you than a mere technical breakthrough. It fuels your fantasy of undermining the Pax Americana which underpins the remarkable  advance in the human condition that we in America's orbit are now enjoying.
Heck there is me being sucked into this silly OTT morality tale.  In future I will try and behave like @NoRegretsCoyote, possibly restricting myself to giving him "likes".
Let me begin by reiterating that the fact that the Norwegian Oil Fund is indirectly exposed 6 parts in a million to bitcoin does not suggest to me a positive answer to the question posed by your thread.


----------



## WolfeTone

Duke of Marmalade said:


> It fuels your fantasy of undermining the Pax Americana which underpins the remarkable advance in the human condition that we in America's orbit are now enjoying.



This is silly.
As I understand it, the largest volume of buyers and transactions of bitcoin is with American people. The notion that they are trying to undermine the 'American dream' - as that is what you are talking about - is daft.

What they are doing, is trying to restore, sustain, and maintain this 'American dream', but they are conscious of some, imbalances, structural deficits (to put it mildly) within the economic and social systems of the gool 'ol USA.
This is always the case, and will probably always be, just as it is human nature to pull and push these imbalances in one's favour.  Bitcoin is a way for anyone and everyone to push or pull against economic and societal imbalances (perceived or real).


----------



## Duke of Marmalade

WolfeTone said:


> This is silly.
> As I understand it, the largest volume of buyers and transactions of bitcoin is with American people. The notion that they are trying to undermine the 'American dream' - as that is what you are talking about - is daft.


I wasn't talking about Muskie, Saylor et al.  I was talking about you and @tecate.


			
				tecate said:
			
		

> The Americans have weaponised money. You think that they are doing good with this? I certainly don't. A couple of years ago, they locked Iran out of international banking - against the wishes of the Europeans. They didn't care - they just acted unilaterally.
> Next up....give us an example of how sanctions have really been a force for good in the world? There isn't one! Have you talked to anyone from a sanctions-hit country? ...because I do all the time. In Venezuela, they have a shortage of all manner of things including medical equipment, drugs, etc. A family member of a friend of mine died in Venezuela last year because of a lack of a very basic drug. That death would not have happened had there not have been sanctions. It's one of countless cases of the real effects of sanctions.


In case you think this was in the context of some other high-falutin' debate @tecate clarified the matter.


			
				tecate said:
			
		

> Discussed exclusively in the context of bitcoin.


Unfortunately I failed to record your own late night words of wisdom on the subject.


----------



## WolfeTone

Duke of Marmalade said:


> I wasn't talking about Muskie, Saylor et al.



Oh I get it, if non-Americans buy bitcoin to protect themselves against moribund CB monetary policy its all part of the Russian/NK axis to destablise America and Western culture as we know it.

But if Americans buy bitcoin, that's a whole new thing! Totally different! 



Duke of Marmalade said:


> In case you think this was in the context of some other high-falutin' debate @tecate clarified the matter.



I think, inherent in @tecate comment is that when an empire becomes too powerful they can be prone to do some bad things. And let's face it, despite the wonders of an amazing country and people like the USA, they tend to some pretty awful things on the global stage also. 
I think ideally, is that it would be great if the USA were to aim to keep all the good stuff that they are great at doing and producing, and try to minimise the nasty stuff they get up to. I don't tecates view on this would be too dissimilar to mine, or millions of other Americans for that matter.


----------



## tecate

Duke of Marmalade said:


> @WolfeTone Nevertheless your "true feelings" and those of your fellow traveller @tecate bare stark comparison with the clinical unemotive contributions of @NoRegretsCoyote.


There's a career in standup awaiting you, Dukie...(although probably a dead beat circuit of comedy clubs replete with airborne rotten apples).



Duke of Marmalade said:


> It is clear that bitcoin means much more to the two of you than a mere technical breakthrough.


If by that you mean that I'm encouraged by the force for good that decentralised crypto/blockchain can be in the world, then that's correct.



Duke of Marmalade said:


> It fuels your fantasy of undermining the Pax Americana which underpins the remarkable  advance in the human condition that we in America's orbit are now enjoying.


Comments were made exclusively re. sanctions  - in the context of bitcoin. There was no other commentary on anything else that gives your comment above legitimacy - let alone that anyone should find a grain of truth in it.



Duke of Marmalade said:


> Let me begin by reiterating that the fact that the Norwegian Oil Fund is indirectly exposed 6 parts in a million to bitcoin does not suggest to me a positive answer to the question posed by your thread.


And let me reiterate that the whole premise of Wolfie starting this thread was to mull over the notion that nation states - through their CBs and Sovereign Wealth Funds - would begin to accumulate bitcoin. All your posts highlight is that process has already begun. It's also encouraging to hear that it seems there isn't any legal impediment to the NTMA holding bitcoin on its balance sheet afterall.


Duke of Marmalade said:


> Unfortunately I failed to record your own late night words of wisdom on the subject.


I hate to disappoint, your Dukeness. I hope the above will suffice.


----------



## NoRegretsCoyote

Duke of Marmalade said:


> It is clear that bitcoin means much more to the two of you than a mere technical breakthrough.


I was quite wrong on bitcoin by the way. I heard of it as long ago as 2009 when I think it was a dollar a bitcoin and wished in hindsight that I'd bought a few.

I didn't think that a currency without state backing would ever engender mass trust. A decade on and it's clear that it has a non-zero value.

It is clear to me now that bitcoin *does *have a use as a means of exchange for wholesale drugs and weapons trading. The currency risk is worth taking as it is a lot simpler than sending suitcases of cash around the world.

Otherwise bitcoin seems to be something that a lot of people can project all sorts of bizarre thoughts on to. I don't really understand this, but it has probably driven some of the value too.


----------



## Duke of Marmalade

WolfeTone said:


> Oh I get it, if non-Americans buy bitcoin to protect themselves against moribund CB monetary policy its all part of the Russian/NK axis to destablise America and Western culture as we know it.
> 
> But if Americans buy bitcoin, that's a whole new thing! Totally different!


I am not talking about Americans or non-Americans I am talking about YOU and @tecate.
I'll remind you again.


			
				tecate exclusively in the context of bitcoin said:
			
		

> The Americans have weaponised money. You think that they are doing good with this? I certainly don't. A couple of years ago, they locked Iran out of international banking - against the wishes of the Europeans. They didn't care - they just acted unilaterally.
> Next up....give us an example of how sanctions have really been a force for good in the world? There isn't one! Have you talked to anyone from a sanctions-hit country? ...because I do all the time. In Venezuela, they have a shortage of all manner of things including medical equipment, drugs, etc. A family member of a friend of mine died in Venezuela last year because of a lack of a very basic drug. That death would not have happened had there not have been sanctions. It's one of countless cases of the real effects of sanctions.


Really, you are getting as stubborn as your mentor.  No more from me on this particular aspect.


----------



## Duke of Marmalade

NoRegretsCoyote said:


> I was quite wrong on bitcoin by the way. I heard of it as long ago as 2009 when I think it was a dollar a bitcoin and wished in hindsight that I'd bought a few.
> 
> I didn't think that a currency without state backing would ever engender mass trust. A decade on and it's clear that it has a non-zero value.
> 
> It is clear to me now that bitcoin *does *have a use as a means of exchange for wholesale drugs and weapons trading. The currency risk is worth taking as it is a lot simpler than sending suitcases of cash around the world.
> 
> Otherwise bitcoin seems to be something that a lot of people can project all sorts of bizarre thoughts on to. I don't really understand this, but it has probably driven some of the value too.


Agree with that.  I don't think the limited medium of exchange utility you cite justifies a $2trn crypto market cap.  But there are other sources of demand most notably speculative.  Again I don't think they are in any way sufficient to sustain the $2trn market cap long term.

If Elon Musk were to change his mind I would say we would get a 50% mark down overnight.  In the context of this particular nation state taking a crypto stake, it surely wouldn't dare take that sort of risk whether it is within its mandate or not.


----------



## WolfeTone

Duke of Marmalade said:


> I am not talking about Americans or non-Americans I am talking about YOU



Yeh, so you keep saying. Perhaps you read up on what Saylor has to say about bitcoin. In particular his views on gold, US Dollar and violence. 
I think you will find that his own thoughts are closer to @tecate views than you are trying to make out. 

But its not unlike to shift the goals when your narrative is bereft of any insight outside your own base BOHA bile. 

Better you say no more on bitcoin.


----------



## tecate

NoRegretsCoyote said:


> It is clear to me now that bitcoin *does *have a use as a means of exchange for wholesale drugs and weapons trading. The currency risk is worth taking as it is a lot simpler than sending suitcases of cash around the world.


Are you aware of any weapons deal financed via bitcoin? The same question re. wholesale drugs trading as I would imagine that it would represent a poor medium in its current form given that there's a high potential for such transactions to be traced from point of origin to final destination.
The US dollar is the medium of choice for illicit transfer of value in the world. Where cash doesn't suffice - the international banking sector is more than happy to facilitate this lucrative activity. Meanwhile, studies have been carried out which have found that only 1% of bitcoin transactions are related to illicit activity.


NoRegretsCoyote said:


> Otherwise bitcoin seems to be something that a lot of people can project all sorts of bizarre thoughts on to. I don't really understand this, but it has probably driven some of the value too.


By all means, feel free to expand on what to your mind are 'bizarre thoughts' in this instance.


Duke of Marmalade said:


> I am not talking about Americans or non-Americans I am talking about YOU and @tecate.
> I'll remind you again.


Indeed you were as per post #145.



			
				Duke of Marmalade said:
			
		

> If Elon Musk were to change his mind I would say we would get a 50% mark down overnight.


In that circumstance, I don't think the news would be welcomed but I also think there would be little material change in the price as a direct consequence.


			
				Duke of Marmalade said:
			
		

> In the context of this particular nation state taking a crypto stake, it surely wouldn't dare take that sort of risk whether it is within its mandate or not.


We've already identified two sovereign wealth funds who have put bitcoin on their balance sheets (either directly or indirectly). I think there needs to be further development in the bitcoin market - and a further expansion of market cap - and then these funds will incorporate bitcoin into their investment mix.


----------



## Firefly

tecate said:


> Comments were made exclusively re. sanctions  - in the context of bitcoin. There was no other commentary on anything else that gives your comment above legitimacy - let alone that anyone should find a grain of truth in it.


I suppose we've all become a little better at wearing masks over the past year, but occasionally they do tend to slip..


----------



## tecate

Firefly said:


> I suppose we've all become a little better at wearing masks over the past year, but occasionally they do tend to slip..


Very much the empty statement Firefly unless you have the wherewith-all to justify it (or at a minimum, explain to us all what it even means. I would suggest that as a basic starting point). The use of bitcoin by sanctions-hit countries came up in discussion here a couple of years ago already. I commented on the inequity of sanctions then - as I have now (in the context of bitcoin, of course). I've been very clear and consistent in what I've stated. Meanwhile, all you have done is cast aspersions in a cryptic manner. I'd suggest you either refrain from such commentary or clarify such comments definitively.
Whilst I'm on, you also stated that I'm a communist in one of your posts yesterday. I invited you to cite one of my 1,200+ posts that provides the backing to that statement. All we've gotten in response is.....***CRICKETS****


----------



## WolfeTone

Firefly said:


> I suppose we've all become a little better at wearing masks over the past year, but occasionally they do tend to slip..



Is this another of your cryptic identity parades on show again?
You left out your customary trademark .


----------



## Firefly

tecate said:


> Are you aware of any weapons deal financed via bitcoin? The same question re. wholesale drugs trading as I would imagine that it would represent a poor medium in its current form given that there's a high potential for such transactions to be traced from point of origin to final destination.
> The US dollar is the medium of choice for illicit transfer of value in the world. Where cash doesn't suffice - the international banking sector is more than happy to facilitate this lucrative activity. Meanwhile, studies have been carried out which have found that only 1% of bitcoin transactions are related to illicit activity.


Enter, yet again, _Whataboutism_, that sacred Russian tactic. Oh dear, has the mask slipped again?


----------



## WolfeTone

@Firefly may I ask you some questions?

Do you think nation states will start to acquire bitcoin? If yes, do you have timeframe, even a guess of when they will?

If no, do you think they are missing an opportunity to acquire a valuable assest?


----------



## Firefly

WolfeTone said:


> @Firefly may I ask you some questions?
> 
> Do you think nation states will start to acquire bitcoin? If yes, do you have timeframe, even a guess of when they will?
> 
> If no, do you think they are missing an opportunity to acquire a valuable assest?


Not a fiddlers, how about you?


----------



## tecate

WolfeTone said:


> @Firefly may I ask you some questions?


Not without receiving a citation from @Firefly  for _'whataboutism'_ apparently. If you've ever asked a question in these parts in the past, steel yourself for the receipt of the charge of having your mask slip also. :-D


----------



## Firefly

tecate said:


> Not without receiving a citation from @Firefly  for _'whataboutism'_ apparently.


Was I wrong?


----------



## tecate

Yes..and I note that you've just left your other vague inferences as exactly that. It's particularly cowardly to cast aspersions and not have the gumption to clarify your deliberately vague claims.


----------



## Firefly

tecate said:


> Yes..and I note that you've just left your other vague inferences as exactly that. It's particularly cowardly to cast aspersions and not have the gumption to clarify your deliberately vague claims.



That's a bit rich coming from you I must say. You have _repeatedly _made assertions without having the gumption to back them up yourself, or in your own words "_If you want to disagree with my opinion, that's another thing entirely. That doesn't require asking someone to cite sources_." and worse.. "_Like I told the other guy, I'm under no obligations to do jack - that's first and foremost. I may or may not choose - as I decide - I won't be dictated to._"

Oh and by the way your post was Whataboutism, when NoRegretsCoyote made a reference to Bitcoin being used for illegal uses you shot back with Whatabout about the USD.....maybe you just don't see it?


----------



## Sunny

I have read some nonsense on this subject but the argument that because NBIM own 1.09% of Microstrategy or any other company somehow equates to a sovereign wealth fund or a Central Bank building up a position a in Bitcoin to protect itself the issue described in the original post takes some beating: _With collapsing finances, the disruption to the fabric of the economy will be felt in the years ahead. Having bitcoin in reserve could shoulder some of that burden._

NBIM is the largest equity investor in the world. There are very few companies that they are not invested in. In fact they owned a bigger % of Microstrategy at the end of 2019 before the company bought Bitcoin and investing in Microstragy became a play on crypto than they own now.


----------



## tecate

Firefly said:


> That's a bit rich coming from you I must say. You have _repeatedly _made assertions without having the gumption to back them up yourself, or in your own words "_If you want to disagree with my opinion, that's another thing entirely. That doesn't require asking someone to cite sources_." and worse.. "_Like I told the other guy, I'm under no obligations to do jack - that's first and foremost. I may or may not choose - as I decide - I won't be dictated to._"


Is this the _whataboutism_ you're talking about?  

As regards my discourse with NoRegretsCoyote, I stand by my post. It's entirely relevant to point out what may be misunderstandings, assumptions and/or untruths. Bitcoin has been long since tarred and feathered on the basis of a perceived or contrived illicit use role. In that context, it's relevant to point out that comparatively with the USD, it's not at the races. You linking to a wiki-explainer on 'whataboutism' doesn't diminish that in any way shape or form.


----------



## Firefly

tecate said:


> As regards my discourse with NoRegretsCoyote, I stand by my post. It's entirely relevant to point out what may be misunderstandings, assumptions and/or untruths. Bitcoin has been long since tarred and feathered on the basis of a perceived or contrived illicit use role. In that context, it's relevant to point out that comparatively with the USD, it's not at the races. You linking to a wiki-explainer on 'whataboutism' doesn't diminish that in any way shape or from.



whataboutism
Definitions from Oxford Languages
Google’s English dictionary is provided by Oxford Languages.

_"the technique or practice of responding to an accusation or difficult question by making a counter-accusation or raising a different issue."_

When it was proffered that Bitcoin has a use as a means of exchange for wholesale drugs and weapons trading, you whataboutered USD and "Where cash doesn't suffice - the international banking sector is more than happy to facilitate this lucrative activity".


----------



## tecate

@Firefly : Post # 166 clarifies the matter.


----------



## Firefly

tecate said:


> @Firefly : Post # 166 clarifies the matter.


I beg to differ, rather post # 167 does


----------



## Duke of Marmalade

When @NoRegretsCoyote pointed out a medium of exchange utility for bitcoin I took at as a rebuttal of my assertion that it would never make the grade as an MoE.  @tecate took it as blasphemy against the sacred one.  Is this a case of pint glasses being half full or half empty?


----------



## tecate

@Duke of Marmalade  - see if you can stretch that any further into your fantasy world.
@Firefly : I disagree and so we park it up there in disagreement and move on.


----------



## WolfeTone

Firefly said:


> Not a fiddlers, how about you?



Yes, I think they will at some point, couldn't guess when. And from the OP I think I made it clear it would be a good thing.

I suppose inherent in my questions was, why are you here? If you have "not a fiddlers", I can only assume you are here to antagonoise and provoke. 
As far as I can tell, you are the only 'contributor' to this thread that has not offered an opinion on the subject matter either way.


----------



## NoRegretsCoyote

tecate said:


> Bitcoin has been long since tarred and feathered on the basis of a perceived or contrived illicit use role.


So where on earth is it useful as a medium of exchange *if not *for illegitimate purposes?

You have a better idea of what a Venezuelan Bolivar will be worth in a week's time than a bitcoin!


----------



## Firefly

WolfeTone said:


> Yes, I think they will at some point, couldn't guess when.



Down here, we would say you are "mad for the Bitcoin", so I was expecting something a bit more specific than that to be honest, especially since you started the thread with the very question n'all...


----------



## Firefly

WolfeTone said:


> I suppose inherent in my questions was, why are you here? If you have "not a fiddlers", I can only assume you are here to antagonoise and provoke.
> As far as I can tell, you are the only 'contributor' to this thread that has not offered an opinion on the subject matter either way.


I did offer an opinion on the subject...my opinion was, admittedly glib, but I did take your questions in good faith...was I wrong?

And....regarding your assumption that I am here to "antagonoise and provoke", well that is certainly a glass half-empty outlook you have right there.


----------



## tecate

NoRegretsCoyote said:


> So where on earth is it useful as a medium of exchange *if not *for illegitimate purposes?


My first suggestion would be to reframe the way you look at bitcoin so that it's not boxed in to a consideration exclusively as a medium of exchange. It is being used as a store of value and a hedge against fiat currency / financial system risk. As the world's most secure network, its also being used to secure Microsoft's digital identity project, Ion. Similarly, the Blockstack network harnesses bitcoin network security to protect their decentralised internet project.
It is being used as a medium of exchange in West Africa - and places where there are major issues with transferring value. It's also being used for larger international / cross-border settlement. It's a component in a number of remittance services.  I don't see anything illicit in all of the above. Lightning network has led to the development of startups such as bottlepay and strike - which I believe will go on to canabalise existing cross border transfer models.



NoRegretsCoyote said:


> You have a better idea of what a Venezuelan Bolivar will be worth in a week's time than a bitcoin!


It's a process of price discovery. If you think it through, it's logical that it should go through said process. If you're saying that volatility is a difficulty/drawback in terms of a medium of exchange use case, I agree entirely. However, as you can see above, this is just one use case. Secondly, it still doesn't preclude its use in that role right now either. My expectation is that it continues to build on its other use cases - and as it matures (we're some years away from that yet), volatility will also diminish. If people have other reasons to hold the asset, then I expect there will also be an element of it being used as a means of exchange.


----------



## Firefly

NoRegretsCoyote said:


> It is clear to me now that bitcoin *does *have a use as a means of exchange for wholesale drugs and weapons trading.


Not to mention it's uses for ransomware, which these Russians quite like...is Vlads reading this thread?


----------



## tecate

People have been trying to tar and feather bitcoin for years on the basis of illicit use, energy use, etc. - conveniently holding it to a higher standard than everything else. When this is pointed out, we get the ill-fitting charge of 'whatabout-ism'. So be it. Sovereign currency remains the means of exchange most used for illicit activity - whether that's in cash or electronically/facilitated by the banking sector.

A Chainalysis report in 2019 concluded there to be 1 percent illicit use of bitcoin.


----------



## Duke of Marmalade

tecate said:


> As the world's most secure network, its also being used to secure Microsoft's digital identity project, Ion.


You really have to track down these supposed adoptions of bitcoin produced by @tecate.


> What is Microsoft’s ION?​As noted by Buchner, ION is open source, so anyone can download the code and run an ION node to use the service. It uses Sidetree, an open-source protocol for decentralized identifiers built by devs from Microsoft, ConsenSys, Mattr and Transmute.
> Open to the public after being in closed beta since June 2020, ION *uses the same logic as Bitcoin’s transaction layers t*o sign off on identity. A public key and its associated private key are used to verify that a user owns an ID.


The bold italic is mine.
No one is questioning the technological aspect of bitcoin- although certainly not on a par with such wonders as TV and Aeronotics.  But how anybody thinks this announcement from Microsoft has any relevance whatsoever for bitcoin's $1trn market cap escapes me.


----------



## tecate

@dukey: what's the significance of your use of italics??


----------



## Duke of Marmalade

tecate said:


> @dukey: what's the significance of your use of italics??


To distinguish it from the other bold.  A some what muted response.


----------



## WolfeTone

Firefly said:


> Not to mention it's uses for ransomware, which these Russians quite like...is Vlads reading this thread?



I'm missing something here? Did you just post an article about ransomware and tie it to illicit bitcoin use by Russians and Russian government? 
Even though the article does not mention Bitcoin, Russia or Putin?


----------



## tecate

@WolfeTone : There's no need to let facts get in the way of a good old fashioned tar n' feathering!


----------



## tecate

Duke of Marmalade said:


> You really have to track down these supposed adoptions of bitcoin produced by @tecate.


There's no 'supposed' about it.


Duke of Marmalade said:


> No one is questioning the technological aspect of bitcoin- although certainly not on a par with such wonders as TV and Aeronotics.  But how anybody thinks this announcement from Microsoft has any relevance whatsoever for bitcoin's $1trn market cap escapes me.


You can look at items individually Duke - or you can look at the complete picture. I suggest the latter.


----------



## Firefly

.


----------



## Duke of Marmalade

I’ll ask @WolfeTone who owns this thread.  Do you think Microsoft copying bitcoin’s technology for ID management increases the possibility of nation states buying bitcoin?  I can certainly see the possibility of nation states adopting similar technology for ID management but I don’t think you would equate this with them buying bitcoin or would you?


----------



## WolfeTone

Firefly said:


> I was expecting something a bit more specific than that to be honest



I guess if I cannot provide you with your expected specifics and you have "not a fiddlers" about the subject matter, you will be on your merry way now?


----------



## WolfeTone

Duke of Marmalade said:


> Do you think Microsoft copying bitcoin’s technology for ID management increases the possibility of nation states buying bitcoin?



No, I honestly couldn't say that it does.



Duke of Marmalade said:


> I can certainly see the possibility of nation states adopting similar technology for ID management



Yes, me too. But now that you mention it that way, then why not nation states buying bitcoin direct for treasury management?


----------



## tecate

Duke of Marmalade said:


> Do you think Microsoft copying bitcoin’s technology for ID management increases the possibility of nation states buying bitcoin?


I guess you'd have to ask him a factually correct question to start with. Microsoft's Digital Identity project (Ion) is secured directly on the bitcoin network. MS engineers decided to use it to harness its utility as a security layer.


----------



## jim

Crypto seems to taking a serious dive this morning showing its volatility once again.


----------



## tecate

jim said:


> Crypto seems to taking a serious dive this morning showing its volatility once again.


Indeed Jim - and you can expect that volatility to exist for some years to come. Bitcoin and crypto remains at a very early stage on the adoption curve. Until it matures, it's in price discovery mode.


----------



## Duke of Marmalade

tecate said:


> I guess you'd have to ask him a factually correct question to start with. Microsoft's Digital Identity project (Ion) is secured directly on the bitcoin network. MS engineers decided to use it to harness its utility as a security layer.


It does not use bitcoin.  It has no relevance for its value or its appropriateness as an investment for nation states.


tecate said:


> Indeed Jim - and you can expect that volatility to exist for some years to come. Bitcoin and crypto remains at a very early stage on the adoption curve. Until it matures, it's in price discovery mode.


We can all drink to that from our pint glasses.  Though being in “discovery mode” sounds a bit like adolescent growing pains.  In reality nobody has a clue what price it will grow up/down to be.  The estimates range from 0 to over $1m.  There are those who say this is an asymmetric risk i.e. far more upside than downside.  I guess that is the pint glass being a quart full.  I think nation states should wait till bitcoin discovers its price.


----------



## tecate

Duke of Marmalade said:


> It does not use bitcoin.  It has no relevance for its value or its appropriateness as an investment for nation states.


It relies directly on the security of the bitcoin network. Its use in this role is  a further demonstration of its utility - and utility is relevant to assessing value. Anyway, that's my view. You disagree - that's fine.



Duke of Marmalade said:


> We can all drink to that from our pint glasses.  Though being in “discovery mode” sounds a bit like adolescent growing pains.  In reality nobody has a clue what price it will grow up to be.  The estimates range from 0 to over $1m.  There are those who say this is an asymmetric risk.  I guess that is the pint glass being a quart full.  I think nation states should wait till bitcoin discovers its price.


There is no other way for a network and digital asset of its nature to find its value. That may be deemed to be inconvenient for some but when the overall proposition is assessed in its entirety, sovereign funds would do well to get off zero.


----------



## Firefly

WolfeTone said:


> I guess if I cannot provide you with* your expected specifics* and you have "not a fiddlers" about the subject matter, you will be on your merry way now?



How about your own specifics, below....care to answer these questions, being your questions n'all?

_Do you think nation states will start to acquire bitcoin? If yes, do you have timeframe, even a guess of when they will? 
If no, do you think they are missing an opportunity to acquire a valuable assest?_


----------



## WolfeTone

Firefly said:


> How about your own specifics



This is just _howaboutism. _The ugly cousin of _whataboutism_.

I already gave my answer to you



WolfeTone said:


> Yes, I think they will at some point, couldn't guess when. And from the OP I think I made it clear it would be a good thing.



Opening a thread with question in the title may give some indication to the reader that the poster is looking for answers, or at least trying to glean some thoughts and views of other posters that may help provide an answer or shape a view. I think all of the posters have contributed one way or another the direction of their thoughts, except yourself - you are firmly in the "_not a fiddlers_", _howaboutery, random Guardian articles_ camp.


----------



## Duke of Marmalade

tecate said:


> Microsoft's Digital Identity project (Ion) is secured directly on the bitcoin network. MS engineers decided to use it to harness its utility as a security layer.


Serious question, not part of the bun fight.
My source said it *"uses the same logic"* which is somewhat different from your source. I wonder which it is.  I would have thought bitcoin folk would not take too kindly to use of its network for other than transactions in bitcoin. (I know script can be used in this way.)  Is there not an issue with scalability?
Of course does not alter my comment re its relevance to this thread.


----------



## Firefly

WolfeTone said:


> I already gave my answer to you



Your Question:
"Do you think nation states will start to acquire bitcoin? If yes, _do you have timeframe_, _even a guess of when they will_?"

Your Answer:
"Yes, I think they will at some point, _couldn't guess when_"

You (a) didn't offer a timeline, nor (b) provide _"even a guess of when they will"_


----------



## WolfeTone

@Firefly Did you read the title of the thread? Clearly, like you, I have no idea when nation states will acquire bitcoin. That is why I posed the question. However, inherent in the question is my assumption, _unlike you_, that they _will_ acquire bitcoin.

So for you, as regarding the acquirement of bitcoin and/or the timeframe - you have not a fiddlers.

For me, I have taken a position that they will acquire bitcoin but I do fall short on being able to determine a timeframe. Hence the question in the title.
I will say, given some of the answers and contributions it appears that despite the initial protestations that the NTMA could not, or never hold bitcoin, the NTMA could actually hold bitcoin but are just highly unlikely to do so for the forseeable future. Although, I do think when it does happen it will happen very quickly.

Also, some other answers suggest that some nation states are actually acquiring bitcoin, but these suggestions are dampened by other views that they are not states to be taken 'seriously', or indirect ownership of bitcoin through sovereign wealth funds is not tacit acceptance of acquiring bitcoin.

And then there are your own views - Russian conspiracy theories that you unwittingly manage to debunk by yourself within a sentence or two, and random newspaper articles that bear no correlation to your statements. Summarised by "not a fiddlers".


----------



## Firefly

WolfeTone said:


> @Firefly Did you read the title of the thread? Clearly, like you, I have no idea when nation states will acquire bitcoin. That is why I posed the question. However, inherent in the question is my assumption, _unlike you_, that they _will_ acquire bitcoin.
> 
> So for you, as regarding the acquirement of bitcoin and/or the timeframe - you have not a fiddlers.
> 
> For me, I have taken a position that they will acquire bitcoin but I do fall short on being able to determine a timeframe. Hence the question in the title.
> I will say, given some of the answers and contributions it appears that despite the initial protestations that the NTMA could not, or never hold bitcoin, the NTMA could actually hold bitcoin but are just highly unlikely to do so for the forseeable future. Although, I do think when it does happen it will happen very quickly.
> 
> Also, some other answers suggest that some nation states are actually acquiring bitcoin, but these suggestions are dampened by other views that they are not states to be taken 'seriously', or indirect ownership of bitcoin through sovereign wealth funds is not tacit acceptance of acquiring bitcoin.
> 
> And then there are your own views - Russian conspiracy theories that you unwittingly manage to debunk by yourself within a sentence or two, and random newspaper articles that bear no correlation to your statements. Summarised by "not a fiddlers".


Your Question:
"Do you think nation states will start to acquire bitcoin? If yes, do you have timeframe, even a guess of when they will?"

Your _First_ Answer:
"Yes, I think they will at some point, _couldn't guess when_"

Your _Second_ Answer:
"..I have taken a position that they will acquire bitcoin but_ I do fall short on being able to determine a timeframe_."

If you cannot provide a timeframe, in your own words, can you even guess when they will?


----------



## WolfeTone

Firefly said:


> If you cannot provide a timeframe, in your own words, can you even guess when they will?



Ok, just for you, I will take a guess. Within 7yrs. 

You can offer an opinion, thought, viewpoint now? Other than glib and random comments?


----------



## noproblem

I remember at the outset of all this BC business and the arguments for and against BC, Mr Burgess saying that at the end of the day BC was just worthless, no value, etc. Then some time later I watched as ordinary people in the street came across saying they had bought some, sold some and others were holding on to it because they totally believed it would soar. No doubt some "investors"  made a few bob, some i'm sure lost and others are in there for the long run. Now, this "long run" strategy has me a bit baffled. Imagine you buy something for a few Euro and find yourself the owner of the exact same asset now worth €60,000.00 (was worth). I would love to know if there's many punters on here who actually bought a few Bitcoin for the couple of Euro and sold on for the €60k?  Saw a piece in yesterdays Indo suggesting similar to Me Burgess that it's a worthless bubble type "thingy".  In any case, did many make a killing when they had a chance? Not just a few € but a proper Kill?


----------



## Firefly

WolfeTone said:


> Ok, just for you, I will take a guess. Within 7yrs.
> 
> You can offer an opinion, thought, viewpoint now? Other than glib and random comments?


That wasn't hard now was it?     

My answer was, already acknowledged, glib. But the truth is I really don't know. Just like I don't know whether it will rain on the 1st August this year, I don't know if nation states will acquire Bitcoin.


----------



## WolfeTone

Firefly said:


> I don't know whether it will rain on the 1st August this year



You could perhaps open a thread on that so?
According to some Russian conspiracy theorists, Putin is trying to control the weather.

Can Russia control the weather

Its got stuff about NK also, so why not knock yourself out?


----------



## Firefly

WolfeTone said:


> You could perhaps open a thread on that so?
> According to some Russian conspiracy theorists, Putin is trying to control the weather.
> 
> Can Russia control the weather
> 
> Its got stuff about NK also, so why not knock yourself out?



Why, I'm not interested in knowing whether if it will rain on the 1st of August? 

So you accuse me of posting random articles and then do exactly that yourself! By the way, I didn't have you for a Daily Mail reader I must say, unless of course you just did a Google search


----------



## WolfeTone

noproblem said:


> I would love to know if there's many punters on here who actually bought a few Bitcoin for the couple of Euro and sold on for the €60k?



I would be surprised if many here, or elsewhere did, although Im sure some both it at $1-2 and still at least hold some.. The psychology at play would be immense. The idea that you could buy something for say, $5, and in a relatively short space of time it is worth $500, let alone $5,000 or $50,000, and _not _cash in some or all of your holding at some point is hard to imagine, for me, anyway.

I've doubled my stake, twice. I still hold some bitcoin, unfortunately its less than my holding in 2017.  But nevertheless what I do hold has now cost me nothing and has become quite valuable. Not life changing, but if predicted $200,000+ price ever emerges I can start to contemplate maybe knocking some years off for early retirement.


----------



## WolfeTone

Firefly said:


> Why, I'm not interested in knowing whether if it will rain on the 1st of August?



Then why mention it? 
That's my point, you don't seem interested in this topic either, so why are u here? You have nothing but glib responses and unrelated, unsubstantiated conspiracy theories.



Firefly said:


> unless of course you just did a Google search



I did a google search


----------



## tecate

Duke of Marmalade said:


> My source said it *"uses the same logic"* which is somewhat different from your source. I wonder which it is.  I would have thought bitcoin folk would not take too kindly to use of its network for other than transactions in bitcoin. (I know script can be used in this way.)  Is there not an issue with scalability?
> Of course does not alter my comment re its relevance to this thread.


It's all there in the article that you selectively quoted from but didn't cite -> Coindesk: '_Microsoft’s ION Digital ID Network Is Live on Bitcoin'_

It's a layer 2 solution which runs on top of the bitcoin network and is secured by it - working in a similar way as lightning network. It's capable of 10,000 digital identity requests per transaction - so there's no scalability issue. The project lead has been quoted as saying that bitcoin is a very important facet of the project as no other network can match its level of security.

As I suggested previously, these features and use cases should all be considered together - rather than in isolation - in arriving at a conclusion as to what overall value bitcoin brings. Bear in mind that this is just the beginning and whilst bitcoin itself is deliberately limited from a programability perspective, there are still people building services to run on top of it.




noproblem said:


> I remember at the outset of all this BC business and the arguments for and against BC, Mr Burgess saying that at the end of the day BC was just worthless, no value, etc. Then some time later I watched as ordinary people in the street came across saying they had bought some, sold some and others were holding on to it because they totally believed it would soar. No doubt some "investors"  made a few bob, some i'm sure lost and others are in there for the long run. Now, this "long run" strategy has me a bit baffled. Imagine you buy something for a few Euro and find yourself the owner of the exact same asset now worth €60,000.00 (was worth). I would love to know if there's many punters on here who actually bought a few Bitcoin for the couple of Euro and sold on for the €60k?


On average, bitcoin has appreciated at a rate of 200% pa over the course of its 12 years so it's a fair assumption to make that early adopters have done ok. WolfeTone recently sold some BTC just below $60,000.



			
				noproblem said:
			
		

> Saw a piece in yesterdays Indo suggesting similar to Me Burgess that it's a worthless bubble type "thingy".


The Indo is nothing more than a blog at this stage - not a good source of info on the subject. Someone ran a search on either the FT or WSJ recently for the term "DeFi" (abbreviated term that refers to Dencentralised Finance). I think it returned around three results. I'm not necessarily referring to bitcoin in this example but conventional/establishment finance (and the media associated with it) has no earthly idea of the disruption that's coming down the tracks.

As regards the bubble charge, its said that a bubble is a bull market that you don't have a position in. There's no doubt that there's hype, over-exuberance and latent greed. I suspect that there will once again be an 80% correction when the dust settles on this particular cycle. However, if you zoom out and look at its ongoing development over the long run, the trajectory is upwards and to the right...as per that 200% pa appreciation I mentioned above.

@WolfeTone : So your back and forth has confirmed to you that you were spot on the first time as per post # 172.


----------



## Firefly

WolfeTone said:


> so why are u here?


I am interested in the subject matter....and regarding the subject matter, not having a fidler's is quite different to not giving a fidler's


----------



## DazedInPontoon

noproblem said:


> I would love to know if there's many punters on here who actually bought a few Bitcoin for the couple of Euro and sold on for the €60k?


I bought a reasonable amount of crypto in 2013 and 2014. I sold some in the previous cycle (a bit too early in hindsight). I've sold a small amount recently. I won't sell more until closer to $100k. I'm happy to hold some indefinitely.


----------



## noproblem

DazedInPontoon said:


> I bought a reasonable amount of crypto in 2013 and 2014. I sold some in the previous cycle (a bit too early in hindsight). I've sold a small amount recently. I won't sell more until closer to $100k. I'm happy to hold some indefinitely.


Thank you for that,  but like tecate and Wolfe Tone not what I wanted to know.


----------



## DazedInPontoon

Well ok, I didn't buy for 1 or 2 euro, but I did buy some at double digit euro prices, and I have held some right through since. It's once in a lifetime kind of stuff.


----------



## WolfeTone

DazedInPontoon said:


> Well ok, I didn't buy for 1 or 2 euro, but I did buy some at double digit euro prices, and I have held some right through since. It's once in a lifetime kind of stuff.



That would certainly qualify as a 'proper Kill' in my eyes.


----------



## joe sod

noproblem said:


> I would love to know if there's many punters on here who actually bought a few Bitcoin for the couple of Euro and sold on for the €60k? Saw a piece in yesterdays Indo suggesting similar to Me Burgess that it's a worthless bubble type "thingy". In any case, did many make a killing when they had a chance? Not just a few € but a proper Kill?


I'd say very few now due to the nature of the bubble, whats unique about bitcoin is that it has crashed a few times and recovered to reach new highs. During the dot com mania many people would have cashed out towards the late 90s  with tidy profits and then watched as it kept going higher, human nature being what it is most of these bought back in because of FOMO.
The nature of bitcoin being a whole belief system would mean that most of these people are still fully invested in bitcoin they couldn't resist missing out as it went to 60K. We will only know for sure when its all over who really made the killing on it.


----------



## WolfeTone

joe sod said:


> due to the nature of the bubble,



I think we can all agree that bitcoins rapid price rise is a characteristic of a bubble. But it is not necessarily identifiable a bubble either. It is only identifiable as a bubble _after_ a rapid price crash and then, and only then, by virtue of the price high and lows can we identify the where and how big the bubble (if there is one) is.




joe sod said:


> The nature of bitcoin being a whole belief system



As opposed to any other form of money? Is there a form of money throughout the history of humankind that has not been built on a belief system?
The core of that belief system being trust.



joe sod said:


> We will only know for sure when its all over



But that could be decades or centuries away?


----------



## Duke of Marmalade

WolfeTone said:


> That would certainly qualify as a 'proper Kill' in my eyes.


Maybe.  We do not want to pry into DiP's "proper kill" but here is a not unreasonable scenario that fits the stated facts. 
S/he bought €5,000 (a reasonable amount) at €50 (double digits).

When it went to €15,000 s/he cashed in €5,000 (I would, even if I had the faith).
And so on, and is currently still holding about €10,000 worth (a mere fraction of the original purchase).  I would say that strategy would have provided about €30,000 profit.  Certainly better than a poke in the eye, but a "proper kill"?  Now if s/he had held on to the original purchase that would represent a profit of €5m which would be a "proper kill" even to a duke.


----------



## WolfeTone

Duke of Marmalade said:


> Now if s/he had held on to the original purchase





DazedInPontoon said:


> I did buy some at double digit euro prices, and I have held some right through since.



The implication being that s/he has a least 1 BTC or more likely more considering the "some" reference. Bought at double digit euros, so no greater than €99, and held right through since.
Which is worth some €40,000 per €99 unit of bitcoin.



DazedInPontoon said:


> It's once in a lifetime kind of stuff.



Agreed. I think @noproblem is searching for the ultimate kill, but I would imagine they would be few and far between.

More importantly, and heading back close to topic. Christine LaGarde is propagating the notion that hyperinflation is actually a good thing.

"_I completely appreciate that people who are saving are not satisfied with being charged the consequences of negative interest rates, but we have to look at the situation from a global point of view. We cannot look at a particular depositor, or a particular category, we have to look at the whole economy. And we know that by putting in place those negative interest rates, we are effectively supporting the economy, we're encouraging enterprises, families, households, young couples, to actually borrow at very low rates in order to invest, in order to buy their first apartment, in order to buy some equipment, and....the contribution that that is in order to support the economy, in order to make sure that jobs are kept, in order to make sure that cooperates can continue to operate and produce is clearly a trade off against some aspects that are resented by those that are only savers and are not borrowers."_
Source: Twitter, @ecb, Apr 23, 12:21pm.  

So there you have it folks, FTB's saving for a deposit on an apartment or a house are not helping the economy. So much so that your savings need to be confiscated to induce you to borrow instead at very low interest rates. With eurozone house prices rising 5.4% yoy, the only way for FTB to get a house or apartment is to quit that savings nonsense and go all in on borrowing, 100%, maybe more (does LaGarde understand the correlation?)

[broken link removed]

@Duke of Marmalade, I think your brave new world has arrived. Looking good?


----------



## Sunny

Not exactly stating hyper inflation is a good thing though is she??? She is explaining economics 101 that junior cert students learn. Whether you agree with her or not, I don't see anything controversial in what she said. Not like she is suddenly announcing the ECB have abandoned 2% inflation target and are instead looking for hyper inflation to kill off indebtedness.


----------



## WolfeTone

Sunny said:


> Not exactly stating hyper inflation is a good thing though is she



Of course she is not saying it directly, but she is intimating that taxes on savings are here and if anyone had any cop on they would take their money out of banks, spend, and borrow as much as they can "at very low interest rates"


Sunny said:


> She is explaining economics 101 that junior cert students learn.



Exactly. You need see beyond the junior cert economics to understand the implications.



Sunny said:


> I don't see anything controversial in what she said.



Exactly, because she is explaining economics 101 that is geared to junior cert economic thinking.


----------



## Sunny

WolfeTone said:


> Of course she is not saying it directly, but she is intimating that taxes on savings are here and if anyone had any cop on they would take their money out of banks, spend, and borrow as much as they can "at very low interest rates"
> 
> 
> Exactly. You need see beyond the junior cert economics to understand the implications.
> 
> 
> 
> Exactly, because she is explaining economics 101 that is geared to junior cert economic thinking.



Except that's not what she is saying is it??? That's what you think she is saying. She admits negative rates hurt savers but it is a lesser evil than the alternative when looking at the whole economy. Feel free to disagree with her but nowhere does she mention hyper inflation and nowhere does she tell people to fill their boots with debt. 

You basically took a quote, read what you wanted into it and then used that as proof for some idea you had.....handy tool to have in any discussion....


----------



## Duke of Marmalade

“investopedia” said:
			
		

> Hyperinflation is a term to describe rapid, excessive, and out-of-control general price increases in an economy. While inflation is a measure of the pace of rising prices for goods and services, hyperinflation is rapidly rising inflation, *typically measuring more than 50% per month.*


@WolfeTone I know hyperinflationary breakdown of the corrupt Western financial system is a fantasy of yours.  If it stokes your fantasy that 5% yoy house price rises is bringing 50% mom inflation closer why should I rain on you?
I think you are on record as arguing that high interest rates cause inflation.

Having said that I think Mme. Lagarde is wrong on the low interest rates helping folk to buy their first apartment.  All the low interest rates are doing there is driving up prices and making them less affordable.  She’s out of her depth.


----------



## noproblem

Duke of Marmalade said:


> @WolfeTone I know hyperinflationary breakdown of the corrupt Western financial system is a fantasy of yours.  If it stokes your fantasy that 5% yoy house price rises is bringing 50% mom inflation closer why should I rain on you?
> I think you are on record as arguing that high interest rates cause inflation.
> 
> Having said that I think Mme. Lagarde is wrong on the low interest rates helping folk to buy their first apartment.  All the low interest rates are doing there is driving up prices and making them less affordable.  She’s out of her depth.


Was she ever anywhere other than out of her depth?


----------



## Sunny

noproblem said:


> Was she ever anywhere other than out of her depth?


Political appointment if ever there was one. Having said that, the role reminds me of the Lord mayor. Looks good and all the parties/countries want it but at the end of the day, very little power. Still run by the Governing Council.


----------



## WolfeTone

Sunny said:


> That's what you think she is saying.



Granted, it is my interpretation of what she is saying.

To elaborate a little,

"_*in order* to make sure that jobs are kept,_ _*in order* to make sure that cooperates can continue to operate and produce is clearly a trade off against some aspects that are *resented* by those that are only savers and are not borrowers" _

I thought free market competition in a democratic society would decide all that?
Not a central bank? 
At least that's what they thought at Junior cert in my school anyway. 

Instead a centralised command banking economy where policy makers, unelected by the people, get to decide and implement a monetary policy over 400m people that says, *savers pay a tax*,  regardless of the amount of savers, or those attempting to save in that actual economy.

If, for imagine, a majority of income earners in this economy are savers, or trying to save - on the premise of the age-old, but somewhat quaint, theory of prudence. 
How should such income earners react? 

I don't know, and I don't know when or for how long, but I do sense the prospect of dissent emerging at some point that exposes the bankrupt thinking.


----------



## WolfeTone

Duke of Marmalade said:


> If it stokes your fantasy that 5% yoy house price rises is bringing 50% mom inflation closer why should I rain on you?



It's not just 5%yoy house prices Duke, please try look beyond the standard text book.
It's 5% increases coupled with monetary policy that taxes savers, coupled with a governing ideology that negative interest rates are actually a good thing for everyone.



Duke of Marmalade said:


> I think you are on record as arguing that high interest rates cause inflation.



Again, you need to look beyond the standard text. If I may, use a 'thought experiment'.
If, per chance, ECB slaps a 50%, a 5% and a 0.5% interest rate on all debt tomorrow (just to see what happens), then what would happen in each scenario? 
Hard to say precisely, however, my argument is, that for a period, and assuming law abidence, that businesses scrambling to stay afloat will pass on the the increased cost of debt service to consumers who in turn (scrambling to pay for necessities) will demand higher wages.

Higher wages has long been argued in this quarter as the holy grail of inducing an inflationary environment.



Duke of Marmalade said:


> Lagarde is wrong on the low interest rates helping folk to buy their first apartment. All the low interest rates are doing there is driving up prices and making them less affordable.



Yes, that is the example I gave. Of course, underlying the paper statement of a 5% increase is the real and pretty dire consequence of younger generations not being able to create a stable future for themselves.
We have had a decade or so of increasing homelessness, mortgage indebtness etc... thankfully it only affected some 10,000 people or so .
Anyway, the critical element is that the ECB thinks we need more of this, not just in Ireland, but across the eurozone.


----------



## Duke of Marmalade

WolfeTone said:


> I thought free market competition in a democratic society would decide all that?
> Not a central bank?
> At least that's what they thought at Junior cert in my school anyway.


Lots of nigh eve stuff _Wolfie _in those last few posts, though I note you have not been deflected from your implicit prediction of 50% month on month inflation.  I think someone once uncharitably suggested that you were way out of your depth in these waters, perhaps you should steer us back on topic to spare your own blushes.
Anyway I singled out the above.  The disappointed leftie anarchos kept up this refrain during the crisis.  Let the free market rip, they cried, let us all crash and burn along with the banks.
Short lesson, possibly above Junior cert level.  Neither of the two extreme models of human economic organisation can be in anyway fit for modern purpose - unbridled free markets or the state command economy.  Instead we need a well balanced mix which requires state involvement and management where it is beneficial.  Perhaps the most delicate and essential lubricant of a modern economy is its monetary system.  Central Banks in a democracy are essential servants of the common good not an elitist plot to deny the leftie anarchos their fantasy chaos.


----------



## WolfeTone

Duke of Marmalade said:


> I think someone once uncharitably suggested that you were way out of your depth in these waters, perhaps you should steer us back on topic to spare your own blushes.



Thanks, Duke, certainly the junior cert theory of interest rates up, inflation down, interest rate down, inflation up, in a conventional monetary system is being peddled quite a lot. I certainly have no issue with that. 
What I do take issue with is the prevailing belief that we are living in a conventional monetary system and that conventional monetary theories be applied. 
Here is some more in-depth thought from Lagarde (assuming supported by her governing council). I wouldn't recommend a full read, I've summarized the theme in title. 

I thought we had figured out inflation? 

Instead, since you mentioned houses, I quote this excerpt, 

_"our economies are changing increasingly quickly. We need to keep track of broad concepts of inflation that capture the costs people face in their everyday lives and reflect their perceptions, including measures of owner-occupied housing. This is not about moving the goalposts for monetary policy. It is about future-proofing how we measure inflation."_

Appreciating we can all interpret the same text in different ways, my interpretation of the above is a dawning realisation upon on monetary overseers that faith in the peddled inflation rate is increasingly wearing thin with the population, particular in consideration of the realities they experience with housing, mortgages and rents. 




Duke of Marmalade said:


> The disappointed leftie anarchos kept up this refrain during the crisis. Let the free market rip, they cried, let us



I thought that was Reagan/Tatcherism that wanted to let the free market rip? World-turned-upside-down-much? 



Duke of Marmalade said:


> Neither of the two extreme models of human economic organisation can be in anyway fit for modern purpose - unbridled free markets or the state command economy.



Ah, we can find some common ground here. I agree. The difference being I suppose, who should shoulder the burden, at what time and to what extent when things go pear-shaped, and who benefits and to what extent, when it's time to let the bull loose. 
A concise set of rules, derived from democratic platform and applied without fear or favour, is often thought to be the most just way of ensuring a fair and equitable system. 



Duke of Marmalade said:


> Central Banks in a democracy are essential servants of the common good



Yes they are. But in a democracy there needs to be scope for dissent. And dissent should have meaningful channels to challenge the prevailing policy. 
The ECB is not such an institution.


----------



## Duke of Marmalade

WolfeTone said:


> Thanks, Duke, certainly the junior cert theory of interest rates up, inflation down, interest rate down, inflation up, in a conventional monetary system is being peddled quite a lot. I certainly have no issue with that.
> What I do take issue with is the prevailing belief that we are living in a conventional monetary system and that conventional monetary theories be applied.
> Here is some more in-depth thought from Lagarde (assuming supported by her governing council). I wouldn't recommend a full read, I've summarized the theme in title.
> 
> I thought we had figured out inflation?
> 
> Instead, since you mentioned houses, I quote this excerpt,
> 
> _"our economies are changing increasingly quickly. We need to keep track of broad concepts of inflation that capture the costs people face in their everyday lives and reflect their perceptions, including measures of owner-occupied housing. This is not about moving the goalposts for monetary policy. It is about future-proofing how we measure inflation."_
> 
> Appreciating we can all interpret the same text in different ways, my interpretation of the above is a dawning realisation upon on monetary overseers that faith in the peddled inflation rate is increasingly wearing thin with the population, particular in consideration of the realities they experience with housing, mortgages and rents.
> 
> 
> 
> 
> I thought that was Reagan/Tatcherism that wanted to let the free market rip? World-turned-upside-down-much?
> 
> 
> 
> Ah, we can find some common ground here. I agree. The difference being I suppose, who should shoulder the burden, at what time and to what extent when things go pear-shaped, and who benefits and to what extent, when it's time to let the bull loose.
> A concise set of rules, derived from democratic platform and applied without fear or favour, is often thought to be the most just way of ensuring a fair and equitable system.
> 
> 
> 
> Yes they are. But in a democracy there needs to be scope for dissent. And dissent should have meaningful channels to challenge the prevailing policy.
> The ECB is not such an institution.


Okay.  But I still think suggestions of 50% month on month inflation do  not belong in the thread. Happy to move back on topic.


----------



## WolfeTone

Duke of Marmalade said:


> I still think suggestions of 50% month on month inflation do not belong in the thread



Fair enough, with the exception that policies being implemented, in my view, move closer to such an environment. That is why I buy bitcoin.
Others, like yourself, think differently and believe that the 'greater good' theory, in trusted hands, is sufficient to steer off such an environment.


----------



## Duke of Marmalade

WolfeTone said:


> Fair enough, with the exception that policies being implemented, in my view, move closer to such an environment. That is why I buy bitcoin.
> Others, like yourself, think differently and believe that the 'greater good' theory, in trusted hands, is sufficient to steer off such an environment.


I would suggest that gold is a much surer insurance against hyperinflation.  Notably its price has hardly moved in the last twelve months suggesting that fears of hyperinflation are not paramount in the investment community, as further witnessed by the 1.5% 10 year expected inflation in index linked bonds.
Gold is a fairly certain insurance against HI.  In case you missed them, these are a few of the risks facing bitcoin even if we have HI.

It is usurped by a better crypto - surely at 12 years of age it is getting a bit old
Quantum computing destroys its elliptic curve private key technology
Central banks successfully suppress it (could happen to gold, I guess)
The satoshi drops that it actually has no intrinsic/utility value
Elon Musk moves on to some new fad like doggie or whatever


----------



## WolfeTone

Duke of Marmalade said:


> It is usurped by a better



I have acknowledged this in past that it is a threat to bitcoin. But instead of it being the end of the crypto era with the death of bitcoin. It will still do what bitcoin does, only better. 
And we may end up  having the same discussion all over again, only this time it is with betterbitcoin. 


Duke of Marmalade said:


> Quantum computing destroys its elliptic curve private key technology



Or enhances it. 



Duke of Marmalade said:


> Central banks successfully suppress it (could happen to gold, I guess)



I think they have done that quite successfully.


----------



## tecate

Duke of Marmalade said:


> Notably its price has hardly moved in the last twelve months suggesting that fears of hyperinflation are not paramount in the investment community, as further witnessed by the 1.5% 10 year expected inflation in index linked bonds.


$ has been moving from gold into bitcoin which goes some way into explaining why gold has been flat the last few months. Inflation is a two track affair. Some items are deflationary - whilst assets and commodities are inflationary.




Duke of Marmalade said:


> It is usurped by a better crypto - surely at 12 years of age it is getting a bit old


These are old tired arguments but lets go through them. The classic example that usually gets rolled out in this discussion is Facebook flipping MySpace. What many don't account for in that instance is that ..A. MySpace wasn't anywhere near a $1 trillion dollar company at the time - bitcoin is a $1 trillion dollar asset. At its peak, MySpace had a valuation of $12 billion.
B. Any pretender is going to have to be a minimum 10x technological improvement in order to usurp it. Facebook managed to steal a march on MySpace as it was optimised for mobile at a time when mobile was taking off - MySpace wasn't.
Of course nothing is forever but there doesn't seem to be much on the horizon over the next decade. The case could be made that Ethereum 2.0 will challenge it - but I think its going to have a whole manner of smart contracting disruption to focus on. Bitcoin is programmably limited for a reason.



Duke of Marmalade said:


> Quantum computing destroys its elliptic curve private key technology


It's a threat to be taken seriously but it's not imminent. Cryptography still has the time to develop to deal with this threat before it becomes a real concern. Other than that, it should be noted that in a quantum computing scenario, bitcoin is well down the list of targets for whomever has that capability. The US military, NSA and others use the very same SHA-256 algorithm-based cryptography. The gatekeepers of the bitcoin project are likely to have steered it toward a quantum-proof algo before this threat becomes imminent/realistic.



Duke of Marmalade said:


> Central banks successfully suppress it (could happen to gold, I guess)


It has been long since acknowledged by most that the gold market has been and continues to be ..heavily manipulated. As I pointed out to you a couple of weeks ago, Henry Ford called this out over 100 years ago already.
Otherwise, with every day above ground bitcoin continues to expand its network effect. The Lindy Effect is in play. There is some risk re. wall street - in that if some centralised entities end up custodying large proportions of it, it becomes centralised and open to control/manipulation. Having them involved has some upside also as it staves off the likelihood of nation states banning it outright. It's a bit of a high wire act - but bitcoin stands a better chance than gold in freeing itself. Gold - due to the nature of how its stored (for the most part) - is centralised. It's easier for people to transport and self custody bitcoin - so it should work out that the majority of it remains in the hands of its owners....meaning that it can't be controlled/manipulated.



Duke of Marmalade said:


> The satoshi drops that it actually has no intrinsic/utility value


It's a $1 trillion dollar asset now Duke. At what point are you going to be prepared to walk away from that objection? You'll be aware that there is a very well worn counter argument to that point too - i.e. it has a base value due to mining cost, it has utility as a settlement layer and means of payment (which you may not find ideal today for micro-transactions - but then that too is getting addressed via lightning network). As per the point raised a couple of days ago, it is being used by the likes of Microsoft and Blockstack as a security layer to secure their digital identity and decentralised internet projects...an emerging use case.



Duke of Marmalade said:


> Elon Musk moves on to some new fad like doggie or whatever


Most of Elon's tweets have been about Dogecoin rather than bitcoin. I don't believe that the influence here is as great as you think it is - where bitcoin is concerned. Doge is a different matter entirely! It's attracted the gamestop/wall street bets crowd and is a phenomenon of this moronic 'fin-fluencer' nonsense. I'm not from the TikTok age - so naturally I don't use it - but by all accounts there's all forms of moronic shilling of dogecoin going on there over the course of the past few weeks.


----------



## Duke of Marmalade

tecate said:


> $ has been moving from gold into bitcoin which goes some way into explaining why gold has been flat the last few months. Inflation is a two track affair. Some items are deflationary - whilst assets and commodities are inflationary.
> 
> 
> 
> These are old tired arguments but lets go through them. The classic example that usually gets rolled out in this discussion is Facebook flipping MySpace. What many don't account for in that instance is that ..A. MySpace wasn't anywhere near a $1 trillion dollar company at the time - bitcoin is a $1 trillion dollar asset. At its peak, MySpace had a valuation of $12 billion.
> B. Any pretender is going to have to be a minimum 10x technological improvement in order to usurp it. Facebook managed to steal a march on MySpace as it was optimised for mobile at a time when mobile was taking off - MySpace wasn't.
> Of course nothing is forever but there doesn't seem to be much on the horizon over the next decade. The case could be made that Ethereum 2.0 will challenge it - but I think its going to have a whole manner of smart contracting disruption to focus on. Bitcoin is programmably limited for a reason.
> 
> 
> It's a threat to be taken seriously but it's not imminent. Cryptography still has the time to develop to deal with this threat before it becomes a real concern. Other than that, it should be noted that in a quantum computing scenario, bitcoin is well down the list of targets for whomever has that capability. The US military, NSA and others use the very same SHA-256 algorithm-based cryptography. The gatekeepers of the bitcoin project are likely to have steered it toward a quantum-proof algo before this threat becomes imminent/realistic.
> 
> 
> It has been long since acknowledged by most that the gold market has been and continues to be ..heavily manipulated. As I pointed out to you a couple of weeks ago, Henry Ford called this out over 100 years ago already.
> Otherwise, with every day above ground bitcoin continues to expand its network effect. The Lindy Effect is in play. There is some risk re. wall street - in that if some centralised entities end up custodying large proportions of it, it becomes centralised and open to control/manipulation. Having them involved has some upside also as it staves off the likelihood of nation states banning it outright. It's a bit of a high wire act - but bitcoin stands a better chance than gold in freeing itself. Gold - due to the nature of how its stored (for the most part) - is centralised. It's easier for people to transport and self custody bitcoin - so it should work out that the majority of it remains in the hands of its owners....meaning that it can't be controlled/manipulated.
> 
> 
> It's a $1 trillion dollar asset now Duke. At what point are you going to be prepared to walk away from that objection? You'll be aware that there is a very well worn counter argument to that point too - i.e. it has a base value due to mining cost, it has utility as a settlement layer and means of payment (which you may not find ideal today for micro-transactions - but then that too is getting addressed via lightning network). As per the point raised a couple of days ago, it is being used by the likes of Microsoft and Blockstack as a security layer to secure their digital identity and decentralised internet projects...an emerging use case.
> 
> 
> Most of Elon's tweets have been about Dogecoin rather than bitcoin. I don't believe that the influence here is as great as you think it is - where bitcoin is concerned. Doge is a different matter entirely! It's attracted the gamestop/wall street bets crowd and is a phenomenon of this moronic 'fin-fluencer' nonsense. I'm not from the TikTok age - so naturally I don't use it - but by all accounts there's all forms of moronic shilling of dogecoin going on there over the course of the past few weeks.


Well I was only pointing out to _Wolfie _that if hyperinflation is big on his radar gold is a surer insurance policy than any crypto.  Other than the dawning that Professor Roubini and the Nobel crowd are right I don't think the other risks I cited are significant.

But I do want to tease out this Quantum Computing thing.  I am by no means an expert but my understanding is that it is the elliptic curve private key/public key technology which is at more risk than SHA-256.  If it becomes possible to easily trace the private key from the public key that looks like a nuke to me.  But my instinct is that this isn't a significant risk.


----------



## WolfeTone

Duke of Marmalade said:


> gold is a surer insurance policy than any crypto.




Michael Saylor on gold

"_Gold invites violence.

Ceasar sacked Gaul to take the gold
Kublai Khan seized the gold
Pizarro seized gold from the Incas
Cortez seized gold from Aztecs
Charles I seized the gold from British Nobles
Prussians seized gold from the French in 1871
WWI everyone seized the gold
Lenin seized gold from the church in 1922
Roosevelt seized the gold in 1933
Stalin seized the gold of the Spaniards in 1936
Churchill took everyone's gold in 1940 at the onset of the war.
At Bretton Woods the US seized the world's gold and took it hostage. And in 1971 Nixon killed all the hostages. 

Gold is always getting seized."_


----------



## Duke of Marmalade

WolfeTone said:


> Michael Saylor on gold
> 
> "_Gold invites violence.
> 
> Ceasar sacked Gaul to take the gold
> Kublai Khan seized the gold
> Pizarro seized gold from the Incas
> Cortez seized gold from Aztecs
> Charles I seized the gold from British Nobles
> Prussians seized gold from the French in 1871
> WWI everyone seized the gold
> Lenin seized gold from the church in 1922
> Roosevelt seized the gold in 1933
> Stalin seized the gold of the Spaniards in 1936
> Churchill took everyone's gold in 1940 at the onset of the war.
> At Bretton Woods the US seized the world's gold and took it hostage. And in 1971 Nixon killed all the hostages.
> 
> Gold is always getting seized."_


If I was  looking for a HI insurance policy, that would be a terrific promotion of gold.  Or is your point that it might be seized?


----------



## WolfeTone

Duke of Marmalade said:


> If I was  looking for a HI insurance policy, that would be a terrific promotion of gold.  Or is your point that it might be seized?



It's Saylor view, I think he articulates the point very well, don't you think? 

Best of luck cashing in an insurance policy after a state seizure.


----------



## tecate

@WolfeTone : This latest development suggests the answer to your original  question is 'soon' (if a few are not already holding).


__ https://twitter.com/i/web/status/1387123993614946304
Regardless of the underlying circumstances, that's a central bank  normalising the use of crypto for payments ( particularly large international settlement). The rest will follow (and by the rest I mean them holding significant bitcoin reserves (although there's a good chance they do already) and the practice spreading to other jurisdictions).

It's not just time for CBs to get off zero, it's time for everyone to get off zero.


----------



## Duke of Marmalade

When a cult looks to Iran for its affirmation its levels of self doubt must be high indeed.


----------



## tecate

Duke of Marmalade said:


> When a cult looks to Iran for its affirmation its levels of self doubt must be high indeed.


Quite clearly that works both ways, your Dukeness.  
The irony is that its your good self presenting with the cultish behaviour such that you can't see the wood from the trees. It was specifically this viewpoint from Acheson that I was referring to:

_"But this is a bold move by a central bank, and it sends a strong signal to the global financial community that bitcoin is an alternative. 
The implications of the whole world having access to greater choice of payment instruments… we have yet to fully understand what that means."_

You can focus on ...'meh, it's Iran - it doesn't count' all you wish but that's not what's at play here.


----------



## WolfeTone

tecate said:


> This latest development suggests the answer to your original question is 'soon'



Also, I read somewhere that Turkish Central Bank, having banned its banking system from engaging with crypto a week ago, has since set up its own crypto custodial Bank. 
Albeit I only heard this fleetingly so I may be way off the mark.


----------



## WolfeTone

Duke of Marmalade said:


> When a cult looks to Iran for its affirmation its levels of self doubt must be high indeed.





tecate said:


> You can focus on ...'meh, it's Iran - it doesn't count' all you wish



Yes, @Duke of Marmalade perhaps you can elaborate on your obvious disdain toward the Iranian central bank? 
I'm kind of minded that a central bank is a central bank is a central bank? 

Or perhaps, when is a central bank not a central bank?


----------



## Sunny

You are intelligent people but you are dragging this thread into the land of pixies and fairies if you trying to say that the Central Bank Of Iran is no different to the Central Bank Of Ireland. 

Central Bank Of Iran does not recognise international money laundering rules, has been subject to sanctions for over a decade because of terrorist financing to groups like Hezbollah. It has enabled financing of Quds Force who are linked to significant terrorist activity. It is not even a member of SWIFT. The Governer of the Central Bank is a designated terrorist according to the US. 

You might not agree with sanctions or the world view of Iran but saying Iranian central bank buying bitcoin is an example the rest of the worlds central banks should follow is preposterous.


----------



## WolfeTone

Sunny said:


> You are intelligent people but you are dragging this thread into the land of pixies and fairies if you trying to say that the Central Bank Of Iran is no different to the Central Bank Of Ireland.



I was not saying that the central bank of Iran was the same as Central Bank of Ireland, I was asking what the difference was I understood central banks to be just that, central banks.

You have pointed out some differences, thanks.

That a sovereign state uses its central bank to fund nefarious activities in the terrorism department is hardly the preserve of the Iranians. My understanding is the CBI is not a member of SWIFT because another powerful state, the US, imposed financial sanctions against them that effectively ended their participation in that system?


So while there are differences between central banks in different parts of the world, there are also similarities. The CBIran is a function of the monetary system of Iran, like the CBIreland is a function of the monetary system of Ireland.


----------



## Sunny

WolfeTone said:


> So while there are differences between central banks in different parts of the world, there are also similarities. The CBIran is a function of the monetary system of Iran, like the CBIreland is a function of the monetary system of Ireland.



So? The Central Bank of Iran is not buying Bitcoin (If that is true) because it believes in Bitcoin. It is buying Bitcoin so circumvent sanctions and international money laundering regulations. Whether you think that is a good thing or not, it not really relevant.  If that is what people are clinging to in suggesting that Central Banks around the world are beginning to embrace bitcoin and that it is only a matter of time that they all follow Iran's example, then we really have entered the a new realm of ridiculous. 

There are good arguments to be made for Bitcoin and other Crypto but this isn't one of them.


----------



## WolfeTone

@Sunny ok, for the sake of arguement, I am willing to concede that of all the central banks in the world that acquired bitcoin first I had hoped it would not be the Iranian central bank.


----------



## tecate

WolfeTone said:


> @Sunny ok, for the sake of arguement, I am willing to concede that of all the central banks in the world that acquired bitcoin first I had hoped it would not be the Iranian central bank.


This is the point.  Whilst these guys get apoplectic on the subject, bitcoin doesn't give a fiddlers what your geopolitics is. We've had similar labeling on here re. the presumed politics of those that are supportive of bitcoin. It's a tool that can be utilised by anyone. There is no opinion involved. In her twitter thread, Acheson points out whats relevant here in terms of the ongoing progression of bitcoin which is this -> "It [Iran] is merely taking advantage of a new tool in the global financial toolbox".  THAT is whats relevant - not getting into the reeds on the geopolitics itself. You can decide to get indignant about Iran or you can realise that bitcoin works effectively in global settlement. You can decide that you don't like the circumstances but the reality is that its role in global settlement is being formalised by their central bank.
If in the future another nation thinks that bitcoin could serve a role for it in international trade and settlement, the notion that they will dismiss the idea because Iran has utilised bitcoin is the stuff of pixies and fairies. Someone mentioned SWIFT.  This is the Brussels-based organisation that locked the Iranians out of international banking and prevented the Europeans from trading with them (against their wishes). It's toast - it's only a matter of time until it's replaced.


Sunny said:


> The Central Bank of Iran is not buying Bitcoin (If that is true) because it believes in Bitcoin. It is buying Bitcoin to circumvent sanctions


Nobody is suggesting that Iran has some grand ideal re. bitcoin. Leave your politics and indignation at the door - then look at it again.  They're using an available financial tool - and it's a tool that can be used effectively by any central bank/country. That's proven. Busting sanctions is one thing (and it makes no earthly difference re. your belief of whats right or wrong with that...it presents a need to reach for another financial tool to deal with it). The petro-dollar system is another - that affects a hell of a lot more countries.

Lastly, maybe some of their trading will have something to do with terrorist financing, maybe it will have something to do with their nuclear programme, or maybe it will involve much needed medical supplies. Regardless, when they establish as being available to trade internationally via bitcoin, they're also dragging international trading partners into a need to trade with them in bitcoin also.


----------



## Duke of Marmalade

If Iran is using bitcoin to avoid sanctions then that is in danger of making bitcoin an enemy of the US.  Not a smart thing for bitcoin to do.  A word from Joe in Muskie's ear would be enough to knock 50% of its price instantly.  But I am sure they have many other weapons to fight bitcoin if it is a sanctions buster.


----------



## WolfeTone

tecate said:


> bitcoin doesn't give a fiddlers what your geopolitics is.



That is my sentiment. But, considering the forum we are in, this point would have been easier if it were not Iran.


----------



## WolfeTone

Duke of Marmalade said:


> If Iran is using bitcoin to avoid sanctions then that is in danger of making bitcoin an enemy of the US. Not a smart thing for bitcoin to do.



Bitcoin isn't doing anything, Iran is. 
But if bitcoin is a BOHA, the US need have no concern?


----------



## tecate

Duke of Marmalade said:


> If Iran is using bitcoin to avoid sanctions then that is in danger of making bitcoin an enemy of the US.


You think that they're just considering that now? Who knows what way they've game theoried it out but they would have acted a few years ago already if they felt that was the appropriate or worthwhile thing to do.



Duke of Marmalade said:


> Not a smart thing for bitcoin to do.


I don't think you're getting this.  See my previous post.  Bitcoin doesn't have an 'opinion'.  It's a financial tool - that anyone is free to use.




Duke of Marmalade said:


> A word from Joe in Muskie's ear would be enough to knock 50% of its price instantly.


If Tesla drop kicked bitcoin tomorrow, I doubt the price drop would be 50%. With every cycle, new people are onboarded - oftentimes being much less well informed. That's why we're seeing knee-jerk reactions to all manner of fud that is being deliberately spread to induce that reaction in recent weeks. Those that have been around longer won't react on the basis of such an event.
Even if it dropped by 50%, you're talking about it being a long way above the $20k level that - over the course of 3 years - you told us bitcoin had long since retreated from - leaving so many innocents out of pocket.
Over and above that, you're talking about the price - a short term price drop doesn't kill bitcoin.



Duke of Marmalade said:


> But I am sure they have many other weapons to fight bitcoin if it is a sanctions buster.


You're assuming that they want to fight bitcoin. I've come across all manner of theories on this - and its as clear as mud as regards how the yanks and Chinese think about bitcoin at a strategic level. There's been mention that China likes to see it in the world as it causes problems for the Americans - busting sanctions, etc. Others have speculated that it suits the Americans as the ethos of bitcoin better fits in with the mindset of many Americans. The thinking is that they embraced free market development of the internet and tech - and benefited greatly from it - and that the same would apply to bitcoin/decentralised blockchain. 
It definitely doesn't fit in with the authoritarian Chinese approach BUT it could be that they can live with it at an international level. Some arm of Chinese government came out last week and unexpectedly praised bitcoin. It can also be that they both dislike it but that they could stomach it rather than have their adversary be dominant in international trade with the USD or the upcoming digital Yuan. 
There's no clear understanding of what their thinking is - but either way bitcoin doesn't give a fiddlers. Every day its out in the world, it becomes harder to put back into the bottle - that much is clear. 



WolfeTone said:


> this point would have been easier if it were not Iran.


For sure - that's why in her tweet thread, Acheson referred to bitcoin’s "_reluctant_ role on the global stage of geopolitical tensions".


----------



## Sunny

tecate said:


> This is the point.  Whilst these guys get apoplectic on the subject, bitcoin doesn't give a fiddlers what your geopolitics is. We've had similar labeling on here re. the presumed politics of those that are supportive of bitcoin. It's a tool that can be utilised by anyone. There is no opinion involved. In her twitter thread, Acheson points out whats relevant here in terms of the ongoing progression of bitcoin which is this -> "It [Iran] is merely taking advantage of a new tool in the global financial toolbox".  THAT is whats relevant - not getting into the reeds on the geopolitics itself. You can decide to get indignant about Iran or you can realise that bitcoin works effectively in global settlement. You can decide that you don't like the circumstances but the reality is that its role in global settlement is being formalised by their central bank.
> If in the future another nation thinks that bitcoin could serve a role for it in international trade and settlement, the notion that they will dismiss the idea because Iran has utilised bitcoin is the stuff of pixies and fairies. Someone mentioned SWIFT.  This is the Brussels-based organisation that locked the Iranians out of international banking and prevented the Europeans from trading with them (against their wishes). It's toast - it's only a matter of time until its replaced.
> 
> Nobody is suggesting that Iran has some grand ideal re. bitcoin. Leave your politics and indignation at the door - then look at it again.  They're using an available financial tool - and it's a tool that can be used effectively by any central bank/country. That's proven. Busting sanctions is one thing (and it makes no earthly difference re. your belief of whats right or wrong with that...it presents a need to reach for another financial tool to deal with it). The petro-dollar system is another - that affects a hell of a lot more countries.
> 
> Lastly, maybe some of their trading will have something to do with terrorist financing, maybe it will have something to do with their nuclear programme, or maybe it will involve much needed medical supplies. Regardless, when they establish as being available to trade internationally via bitcoin, they're also dragging international trading partners into a need to trade with them in bitcoin also.



The original title of this thread is 'How Long Before Nation States Buy Bitcoin'......

You come along with a huge announcement with an unsubstantiated story from some crypto website showing Iran are doing something with Bitcoin and on the back of Iran doing something, you say:

_regardless of the underlying circumstances, that's a central bank normalising the use of crypto for payments ( particularly large international settlement). The rest will follow (and by the rest I mean them holding significant bitcoin reserves (although there's a good chance they do already) and the practice spreading to other jurisdictions).

It's not just time for CBs to get off zero, it's time for everyone to get off zero._

The idea that Iran Central Bank is 'Normalising' the use of crypto for other Central Bank's to follow is completely ridiculous and you are doing to a large disservice to your many other informative posts by peddling this nonsense.



As for this bit:

_Lastly, maybe some of their trading will have something to do with terrorist financing, maybe it will have something to do with their nuclear programme, or maybe it will involve much needed medical supplies. Regardless, when they establish as being available to trade internationally via bitcoin, they're also dragging international trading partners into a need to trade with them in bitcoin also._

That's ok then. As long as Iran can pay foreign terrorists in Bitcoin and foreign terrorists can accept the Bitcoin, we are a step closer to Bitcoin being used in International Trade on a greater scale. Is that really your argument?

Since we have decided that Iran is the global trendsetter, it appears that even they want to crack down on it even if it turns out good enough for their Government for whatever reason.....









						Bitcoin backlash: Iran cracks down on crypto exchanges
					

The current hawkish stance comes in the wake of bitcoin’s meteoric price rise since mid-December.




					www.aljazeera.com


----------



## tecate

Sunny said:


> The idea that Iran Central Bank is 'Normalising' the use of crypto for other Central Bank's to follow is completely ridiculous and you are doing to a large disservice to your many other informative posts by peddling this nonsense.


You're entitled to your opinion as I am mine. I disagree. Actively using it for the purpose of international settlement is precisely that. You can lament the underlying circumstances all you wish but the fact is that it is being used as a financial tool to settle international trade. It might not sit well with you (because you're focusing on the geopolitics) but it's the reality.



Sunny said:


> As for this bit:
> 
> _Lastly, maybe some of their trading will have something to do with terrorist financing, maybe it will have something to do with their nuclear programme, or maybe it will involve much needed medical supplies. Regardless, when they establish as being available to trade internationally via bitcoin, they're also dragging international trading partners into a need to trade with them in bitcoin also._
> 
> That's ok then. As long as Iran can pay foreign terrorists in Bitcoin and foreign terrorists can accept the Bitcoin, we are a step closer to Bitcoin being used in International Trade on a greater scale. Is that really your argument?


Again, you're getting into the geo-politics. That's in no way helpful. Who's right or wrong between the US/Iran is beside the point for the consideration of the use of bitcoin in this instance. The fact of the matter is that it is being used by them for international trade settlement - and they've just formalised that.  That is the basis on which trading partners will trade with them too - and so, that pulls more entities into settlement via bitcoin.




Sunny said:


> Since we have decided that Iran is the global trendsetter, it appears that even they want to crack down on it even if it turns out good enough for their Government for whatever reason.....
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Bitcoin backlash: Iran cracks down on crypto exchanges
> 
> 
> The current hawkish stance comes in the wake of bitcoin’s meteoric price rise since mid-December.
> 
> 
> 
> 
> www.aljazeera.com


You make my point for me. I've already stated that they are using bitcoin as a financial tool that is available to them. In that role, it proves itself more than capable of settling international trade.


----------



## Duke of Marmalade

I exercised a little poetic licence by giving bitcoin a persona.  @WolfeTone and @tecate swiftly point out to me that bitcoin is not a person and does not have opinions.  I guess poetry is somewhat wasted in these parts.


----------



## tecate

Sunny said:


> You come along with a huge announcement with an unsubstantiated story from some crypto website ..


Firstly, the publication is Coindesk and they're no better nor worse than any other financial media.
Secondly, what remains unsubstantiated exactly?
Lastly, I linked to Acheson's tweet thread and her thinking on the subject as I consider it very relevant - not the article directly.


----------



## WolfeTone

Bitcoin making all Revoluts dreams come true 

What are the implications of this (if any)? 
Is this not the 'FinTech' that Roubini said would make bitcoin irrelevant @Duke of Marmalade ?


----------



## tecate

WolfeTone said:


> Bitcoin making all Revoluts dreams come true
> 
> What are the implications of this (if any)?
> Is this not the 'FinTech' that Roubini said would make bitcoin irrelevant @Duke of Marmalade ?


Wolfie, I'm sure the good Duke will be along shortly to respond. In the meantime, Aunt Jemima articles? Out of respect for the honourable fish and the humble potato, I wouldn't wrap my fish n' chips with one which leaves Jemima's 'work' lacking a use case....ironic given what she's scribbled about use case in the past. 
Revolut's crypto offering was lacking - this helps give it a bit more utility. Paypal will end up doing the same.


----------



## Duke of Marmalade

WolfeTone said:


> Bitcoin making all Revoluts dreams come true
> 
> What are the implications of this (if any)?
> Is this not the 'FinTech' that Roubini said would make bitcoin irrelevant @Duke of Marmalade ?


Paywall


----------



## WolfeTone

Duke of Marmalade said:


> Paywall



Google 'Bitcoin Revolut', if you can't get passed ft paywall there are several other sites carrying the same item


----------



## Duke of Marmalade

WolfeTone said:


> Google 'Bitcoin Revolut', if you can't get passed ft paywall there are several other sites carrying the same item


I briefly did as you said.  But it all looks a little underwhelming.  Can you summarise the main takeaways that I should have, please.


----------



## WolfeTone

Duke of Marmalade said:


> I briefly did as you said. But it all looks a little underwhelming. Can you summarise the main takeaways that I should have, please.



That is what I was hoping to elicit from posters like yourself. I just assumed that if the FT and other media sites were reporting on it that there may be some significance to it?


----------



## Duke of Marmalade

Sorry @WolfeTone I am by no means well versed in the micro economics of bitcoin.  I'm a macro man.


----------



## DazedInPontoon

The president of El Salvador announced today that he is submitting a bill soon to make Bitcoin legal tender there - I saw him announce it on video. Apparently he has a supermajority to pass the bill too (I can not confirm this).

Jack Mallers who has been in El Salvador working on bitcoin adoption there has also said they will hold bitcoin in their reserves, though I did not hear the president say this directly as part of his announcement, but I guess it doesn't seem far fetched if it's legal tender.

Here is a quote from the bill itself:



> Central Banks are increasingly taking actions that may cause harm to the economic stability of El Salvador
> 
> That in order to mitigate the negative impact from central banks, it becomes necessary to authorize the circulation of a digital currency with a supply that cannot be controlled by any central bank and is only altered in accord with objective and calculable criteria



longer clip including an emotional Jack at the Bitcoin conference in Miami: https://www.youtube.com/watch?v=-Vcgy1wli9k
clip of just the president's announcement: https://www.youtube.com/watch?v=vCtBcKa064s


----------



## tecate

Mike Peterson's work on the El Zonte / Bitcoin Beach project paying dividends. Hoping to make it down there before Christmas. Mallers involvement has been more recent and with Lightning and Mallers Strike coming along, all the locals are accepting btc payments via mobile app. Strike comes into play for remittances - which accounts for 20% of El Salvadors GDP. Losing an average 10% through WU, Money gram, etc in fees is significant.

The snippet you quoted is directly referencing the Feds money printing. Dollarised countries like El Salvador, Ecuador & Panama are seeing dollar reserves devalued with none of the upside.

Well done El Salvador - first of many.


----------



## tecate

It's not clear precisely what this guy has in mind but it seems Paraguay may be moving in the same direction. 


__ https://twitter.com/i/web/status/1401712725886132224
More details to be released during the week.


----------



## tecate

Two members of Parliament in Brazil & Mexico and one each in Panama, Argentina & Ecuador  have also come out and indicated a desire to embrace Bitcoin. Likewise, in the case of an advisor to the Colombian President. Of course, in isolation this means little. However, it's something that was unimaginable not all that long ago and over the longer haul, it will serve to normalise the idea of adoption in some form at nation-state level.


----------



## SDMXTWO

July 2010 BTC 0.08$ Today it is 26'983€. I'd say a lot of people are just miffed they did not buy at the start say 100€ @ .08


----------



## tecate

SDMXTWO said:


> July 2010 BTC 0.08$ Today it is 26'983€. I'd say a lot of people are just miffed they did not buy at the start say 100€ @ .08


And yet this is all still incredibly early. 

Congress is currently in session in San Salvador - and the bill has just passed. This is far more progressive than originally thought. 

- Bitcoin and the US dollar will both be legal tender in El Salvador. 

- Merchants will be required by law to accept bitcoin payment. Nobody will be able to refuse such a payment. There is a transitional clause in the bill to provide an exemption for merchants in remote areas with internet access difficulties.

- The government will assume volatility risk on behalf of merchants - allowing them to automatically convert to USD where that is their preference. This will be facilitated through a state-owned bank. The government will develop a wallet to facilitate this - albeit that use of the wallet is at the discretion of merchants.






The speculation over the past 18 months was that a small country in the developing world would put btc on its balance sheet. This is entirely different and builds on bitcoins use as a means of exchange.


----------



## evil_g

tecate said:


> - The government will assume volatility risk on behalf of merchants - allowing them to automatically convert to USD where that is their preference. This will be facilitated through a state-owned bank. The government will develop a wallet to facilitate this - albeit that use of the wallet is at the discretion of merchants.



That is absolutely hilarious. I hope this guy has his escape plan sorted.


----------



## Brendan Burgess

SDMXTWO said:


> July 2010 BTC 0.08$ Today it is 26'983€. I'd say a lot of people are just miffed they did not buy at the start say 100€ @ .08



People who did not buy at the start would be "miffed" at the lost opportunity.

But not as "miffed" as people like me who sold short and then watched its irrational rise. 

But people who did buy at over $60,000 would be even more "miffed" at the lost money.


----------



## Duke of Marmalade

This is very interesting.  It seems that Bukele is going all-in.  While I don't think a "success", however that is judged, will make bitcoin I see great possibilities for a major disaster, for example many poor people being duped as they see their btc dive.
If the purpose was to avoid transaction fees in US$ transmissions why was this State bank not set up to facilitate that much more conventionally? Indeed why does it  not facilitate the immediate but cost effective conversion of transmitted btc to US$?
Surely the poor people of El Sal are not going to HODL bitcoin, or are they?

As for any possibility of any significant amount of EL Sal reserves being in bitcoin surely the community must in conscience call Halt!  A typical mantra of bitcoin enthusiasts such as hedge funds is that maybe 1% to 2% of your portfolio would be suitable as a diversification play.  These are wealthy individuals or institutions and can afford to take a 1%-2% diversification play.  This is a very poor country - its citizens can't afford even a 1%-2% risk - unless they buy into _Wolfie's _philosophy "if you have nothing to lose, why not go all-in"?"


----------



## Sunny

I don't know what is more hilarious. People keeping an eye on Congress in San Salvador to see what is passed or the idea that The Government while negotiating an IMF aid package is in a position to guarantee anything never mind hold bitcoin or the hedging of the volatility of Bitcoin...


----------



## Brendan Burgess

Sunny said:


> The Government while negotiating an IMF aid package



The IMF should bring the San Salvaorean team of negotiators on a junket to Albania.









						Finance and Development
					





					www.imf.org
				




_The pyramid scheme phenomenon in Albania is important because its scale relative to the size of the economy was unprecedented, and because the political and social consequences of the collapse of the pyramid schemes were profound. At their peak, the nominal value of the pyramid schemes' liabilities amounted to almost half of the country's GDP. Many Albanians—about two-thirds of the population—invested in them. When the schemes collapsed, there was uncontained rioting, the government fell, and the country descended into anarchy and a near civil war in which some 2,000 people were killed. Albania's experience has significant implications for other countries in which conditions are similar to those that led to the schemes' rise in Albania, and others can learn from the way the Albanian authorities handled—and mishandled—the crisis._


----------



## SDMXTWO

Brendan Burgess said:


> People who did not buy at the start would be "miffed" at the lost opportunity.
> 
> But not as "miffed" as people like me who sold short and then watched its irrational rise.
> 
> But people who did buy at over $60,000 would be even more "miffed" at the lost money.


Maybe try some of the other smaller cryptos which are at 0.0028+ now and just forget about them.


----------



## DazedInPontoon

This is wild. As Duke said it seems Bukele is going all-in, and it's moving quickly too. 

I see this whole thing more as a test of, and challange for, Strike than bitcoin. I expect that in terms of the population using it that they'll use Strike. That will take care of the remittance aspect from the US side. There's also no way he can make accepting bitcoin mandatory and expect everyone to learn how to use, accept and secure it in such a short time frame, so I assume what really will happen is that they must allow payment of bitcoin through *some* app, which is probably Strike. Just a guess though.


Duke of Marmalade said:


> Surely the poor people of El Sal are not going to HODL bitcoin, or are they?


I think the Strike app effectively gives the choice of balance as bitcoin or as some USD stable coin.

The other aspect is the government themselves keeping reserves. I see that as a completely unrelated aspect except that if they accept some payments from the citizens via something like Strike, they might accept it as bitcoin and then directly add it to the reserves.

There's a risk Bukele is doing this for all the wrong reasons and that it fails spectacularly. Even if he isn't, there's a risk that they depend on something like Strike and it's just not ready yet for such heavy usage. Fascinating to see though.


----------



## WolfeTone

Duke of Marmalade said:


> This is a very poor country - its citizens can't afford even a 1%-2% risk



But you keep telling us fiat currency is designed to lose 2% purchasing power pa? This is more of the "_you are poor, you will stay poor, that is just the way things are_", mentality.

My take on this, is that is mostly media-pumped window dressing, for now at least. The % population in El Salvador that is engaged in bitcoin I'm guessing is extremely low. And if a large portion of that population is poor, then we are not talking about large sums here, for now at least. 
There is a trend on Twitter about how Tesla will now be forced to take bitcoin payments....but realistically, how many Tesla's are sold in El Salvador? How many poor people buy electric vehicles? Zero, or else they would not be classed as poor.

Away from the hype, overall it is a good thing. It means poor people, perpetually disenfranchised, ostracised, marginalised from the financial and economic system can for the first time take ownership of property that has value, with government backing. This is the import of what is happening now, not that you could buy a latte in bitcoin - that will follow in its own time.
Psychologically this has greater import than the BTC/USD exchange rate.


----------



## tecate

There seems to be a lot of fear and misunderstanding on this. This switch will be very subtle. In reality, everyone keeps using the dollar as normal. However, it just facilitates someone to pay in bitcoin should they want to do so. They are NOT holding bitcoin reserves and not putting bitcoin on their balance sheet per se. They are setting up a trust fund to act as a market maker in effect. i.e. they will automatically convert btc received by a merchant into usd - assuming the merchant wants that conversion - which of course most of them will.

We're talking about starting a project like this from a standing start - so despite this being a groundbreaking move - nobody should expect any major change for the foreseeable. However, El Salvador is an extreme case with regard to remittances. Duke - you referred to 'monetary rape' the other day but surely anyone can see that WU or Moneygram taking 10% of remittances is bonkers - yet that's whats happening. Imagine working a low end job in the US - trying to support family back home in El Salvador and this slime is taking 10%.  That's gone on for years and affects millions of migrants. This should be the start of that going away. Mallers claims zero commission but there's some sort of mechanism built in somewhere or other...but no matter - we're talking a reduction in commission from 10% to 1 or 2%.
Whereas that might not be so significant for any other country at a state level, its hugely significant in El Salvador where remittances account for in excess of 20% of GDP.
It's also clever in that they have not been getting any FDI - but they can harness FDI unconventionally via the crypto community. A further change will be made to immigration policy, which will offer permanent residency to those that want it in return for a minimum 3 BTC inward investment into the country.



			
				Dazed in Pontoon said:
			
		

> There's also no way he can make accepting bitcoin mandatory and expect everyone to learn how to use, accept and secure it in such a short time frame, so I assume what really will happen is that they must allow payment of bitcoin through *some* app,


The government are building out an app for use which will provide for seamless automatic conversion back to USD. However, it's not mandatory - merchants can use any wallet that they want.
The bill was passed and signed last night. The law becomes effective in 90 days so there's an adjustment period. In many Latin countries, merchants tack on a 5% surcharge for using visa/mastercard - so there won't be any such charge in this instance.



			
				Dazed in Pontoon said:
			
		

> I think the Strike app effectively gives the choice of balance as bitcoin or as some USD stable coin


You're quite right. Bitcoin Beach have their own bitcoin-based app. In recent months, the finding has been that locals were using the Strike app akin to a checking account and the Bitcoin Beach app akin to a savings account. Remember - these are people who have been denied access to the banking system.


----------



## DublinHead54

tecate said:


> We're talking about starting a project like this from a standing start - so despite this being a groundbreaking move - nobody should expect any major change for the foreseeable. However, El Salvador is an extreme case with regard to remittances. Duke - you referred to 'monetary rape' the other day but surely anyone can see that WU or Moneygram taking 10% of remittances is bonkers - yet that's whats happening. Imagine working a low end job in the US - trying to support family back home in El Salvador and this slime is taking 10%  That's gone on for years and affects millions of migrants. This should be the start of that going away. Mallers claims zero commission but there's some sort of mechanism built in somewhere or other...but no matter - we're talking a reduction in commission from 10% to 1 or 2%.



What is your source that BTC to USD conversion in EL Salvador will only have a fee of 1-2%?


----------



## Duke of Marmalade

tecate said:


> There seems to be a lot of fear and misunderstanding on this. This switch will be very subtle. In reality, everyone keeps using the dollar as normal. However, it just facilitates someone to pay in bitcoin should they want to do so. They are NOT holding bitcoin reserves and not putting bitcoin on their balance sheet per se. They are setting up a trust fund to act as a market maker in effect. i.e. they will automatically convert btc received by a merchant into usd - assuming the merchant wants that conversion - which of course most of them will.
> 
> We're talking about starting a project like this from a standing start - so despite this being a groundbreaking move - nobody should expect any major change for the foreseeable. However, El Salvador is an extreme case with regard to remittances. Duke - you referred to 'monetary rape' the other day but surely anyone can see that WU or Moneygram taking 10% of remittances is bonkers - yet that's whats happening. Imagine working a low end job in the US - trying to support family back home in El Salvador and this slime is taking 10%  That's gone on for years and affects millions of migrants. This should be the start of that going away. Mallers claims zero commission but there's some sort of mechanism built in somewhere or other...but no matter - we're talking a reduction in commission from 10% to 1 or 2%.
> Whereas that might not be so significant for any other country at a state level, its hugely significant in El Salvador where remittances account for in excess of 20% of GDP.
> It's also clever in that they have not been getting any FDI - but they can harness FDI unconventionally via the crypto community. A further change will be made to immigration policy, which will offer permanent residency to those that want it in return for a minimum 3 BTC inward investment into the country.


A few years back my son was on some medical training thing in Cameroon.  I was on holiday in South of France.  I got the rather alarming message that he had no funds and was rather desperate to receive them.  My normal banking relationships were of no use.  That's when I first discovered WU in a French post office.  Given the banks complete impotence in this space I was truly grateful that WU facilitated the transfer of (I think) €300 in Cameroon Francs, I forget but at most with a day's delay. The charge was €25 or something like that, but I could have kissed them for it.  So I will never see them as slime.  Similarly I do not see charities like Oxfam as slime, even though I understand their fees for merely passing on charitable donations would be considerably higher than 10%.
I didn't reflect on the charges aspect and I certainly didn't blame WU.  If blame there was to be it was that Cameroon was rather backward in the ways of modern banking.  The same seems to hold for El Sal.  The blame would not appear to be on the First World side of the transfer otherwise transfers between US and EU would also be very expensive.
So I am puzzled on a couple of fronts.
If Bukele can set up a State bank to facilitate bitcoin why could he not have set up a State bank to bring conventional bank transfers between the US and El Sal on to a modern footing?  He might even have given all his citizens an opening account (balance zero of course), that would solve the disenfranchisement at a stroke.

As I understand it, bitcoin transactions and holdings were entirely legal in El Sal.  Why could these not have already been used to bypass the slime?


----------



## DazedInPontoon

Duke of Marmalade said:


> If Bukele can set up a State bank to facilitate bitcoin why could he not have set up a State bank to bring conventional bank transfers between the US and El Sal on to a modern footing?


For all the same reasons conventional bank transfers don't work quickly and cheaply between different countries? You say this as if it's trivial, surely it isn't since WU get to charge 25 quid for the service.

Spending 25 to send 300 once in an emergency is grand (I've been in that situation too). But if you're spending 25 to send 50 every week or fortnight I imagine the novelty wears off.

It sounds like Strike, using bitcoin/lighning as the settlement layer is the solution they're using.


----------



## tecate

Duke of Marmalade said:


> A few years back my son was on some medical training thing in Cameroon.  I was on holiday in South of France.  I got the rather alarming message that he had no funds and was rather desperate to receive them.  My normal banking relationships were of no use.  That's when I first discovered WU in a French post office.  Given the banks complete impotence in this space I was truly grateful that WU facilitated the transfer of (I think) €300 in Cameroon Francs, I forget but at most with a day's delay. The charge was €25 or something like that, but I could have kissed them for it.  So I will never see them as slime.  Similarly I do not see charities like Oxfam as slime, even though I understand their fees for merely passing on charitable donations would be considerably higher than 10%.
> I didn't reflect on the charges aspect and I certainly didn't blame WU.  If blame there was to be it was that Cameroon was rather backward in the ways of modern banking.  The same seems to hold for El Sal.  The blame would not appear to be on the First World side of the transfer otherwise transfers between US and EU would also be very expensive.


I understand your example and I understand that you couldn't have cared less about the commission in an emergency scenario. However, millions of migrants around the world today are sending back remittances on an ongoing basis to their families in their countries of origin and the average commission is 10%. That's morally bankrupt. You can say that its the governments issue or the banking systems issue - I would imagine it's both.



Duke of Marmalade said:


> If Bukele can set up a State bank to facilitate bitcoin why could he not have set up a State bank to bring conventional bank transfers between the US and El Sal on to a modern footing?  He might even have given all his citizens an opening account (balance zero of course), that would solve the disenfranchisement at a stroke.



State-owned bank or not, I can only assume that the banking system thwarts that effort. The bill goes out of its way to outline that 70% of the populace don't have bank accounts. Regulatory bloat has a lot to do with that. I'd also imagine he sees what way things are going and its an opportunity for the country to address some major issues and in some ways, put it ahead of the game rather than on a par via conventional banking.



Duke of Marmalade said:


> As I understand it, bitcoin transactions and holding were entirely legal in E Sal.  Why could these not have already been used to bypass the slime?


Because Mallers service hasn't even really gotten going - it's an early stage startup. Furthermore, whilst one of the key facets of bitcoin is decentralisation, it's completely different to what people are accustomed to. There's a large educational aspect to that in introducing this to the populace. The government can help with that by being proactive about it (and they can do so without that affecting bitcoin's decentralisation all the while).


----------



## DublinHead54

DazedInPontoon said:


> For all the same reasons conventional bank transfers don't work quickly and cheaply between different countries? You say this as if it's trivial, surely it isn't since WU get to charge 25 quid for the service.
> 
> Spending 25 to send 300 once in an emergency is grand (I've been in that situation too). But if you're spending 25 to send 50 every week or fortnight I imagine the novelty wears off.
> 
> It sounds like Strike, using bitcoin/lighning as the settlement layer is the solution they're using.



I worked in the United States and never once had to use WU to send money back home. Banks charge high fees on international transfers and there are a number of FinTech competitors closing the gap making it much more affordable (transferwise, worldfirst etc). So I assume the rhetoric on WU relates to workers in the US that are likely to be illegal workers earning cash in hand? Yes this cohort of people get a raw deal and resort to using WU and high fees to send money back given they don't have legal status to open bank accounts etc.

However, I am not sure that BTC solves the root of the issue. If they could now use BTC to bypass WU fees, this just supports the illegal labour market and mistreatment of millions. In this instance BTC is not banking the unbanked but rather keeping them outside the banked system furthering their exclusion and is not humanitarian.

Secondly, the only real reduction in fees would arise from if the individual was paid in BTC which currently is not the case. So in the example of a person in the US paid in $ wanting to send money back to EL Salvador would have to convert the dollar to BTC (fee) first for it to be spent in BTC terms in EL Salvador. However, to convert from $ to BTC on a recognized exchange requires a SSN, photo identity which the person is unlikely to be in the possession of or they wouldn't need to use WU in the first place. This will lead to the use of alternative sources to convert $ to BTC with much higher fees than established exchanges such as coinbase.


A separate question, I assume the price of goods will be higher in EL Salvador when bought with BTC vs $ to account for the spread built into BTC to account for price risk?


----------



## Duke of Marmalade

@tecate @DazedInPontoon I fully accept that my one off "emergency" is in a different league to receiving regular remittances.  But I would pause before calling WU "slime".  Similarly I wouldn't castigate all pawnbrokers as slime.  The former provide transfer facilities, the latter provide credit facilities to a certain constituency not serviced by mainstream banking and it costs a lot more proportionately, because the efforts and the risks are that much more proportionately.
Of course I would see anything that transforms this dynamic as being a good thing.  If bitcoin had intrinsic and stable value it would solve the first for sure.  It has neither and this initiative/stunt of Bukele has a huge potential to backfire on the poor people of El Sal.


----------



## Duke of Marmalade

Dublinbay12 said:


> A separate question, I assume the price of goods will be higher in EL Salvador when bought with BTC vs $ to account for the spread built into BTC to account for price risk?


There is of course a spread in every FX pair.  Whether that spread translates to an increase in retail prices depends on what is the unit of account.  In simple terms the unit of account is the measure by which all transactions are measured.  It is usually the local legal tender.  El Sal will have three legal tenders but I would presume that the US$ will remain the unit of account and so, yes there should be a spread built into BTC retail prices.  That will reverse if BTC ever becomes the unit of account.  There would be no spread in colon retail prices as the 2:1 conversion to US$ is fixed.


----------



## tecate

Duke of Marmalade said:


> @tecate @DazedInPontoon I fully accept that my one off "emergency" is in a different league to receiving regular remittances.  But I would pause before calling WU "slime".  Similarly I wouldn't castigate all pawnbrokers as slime.  The former provide transfer facilities, the latter provide credit facilities to a certain constituency not serviced by mainstream banking and it costs a lot more proportionately, because the efforts and the risks are that much more proportionately.
> Of course I would see anything that transforms this dynamic as being a good thing.  If bitcoin had intrinsic and stable value it would solve the first for sure.  It has neither and this initiative/stunt of Bukele has a huge potential to backfire on the poor people of El Sal.


Use whatever nomenclature you're comfortable with, Duke. At the end of the day, the important item is a 10% slippage for people who can least afford it - making transfers on an ongoing basis. That's a significant loss for them personally and a significant loss for the country as a whole.

I don't see a major potential to backfire. This is a significant move - but most likely it will be a slow burner given that they're starting from standstill. Furthermore, on the risk that you perceive to exist with btc, nobody has to expose themselves to it - if they don't want.


Duke of Marmalade said:


> There is of course a spread in every FX pair.  Whether that spread translates to an increase in retail prices depends on what is the unit of account.  In simple terms the unit of account is the measure by which all transactions are measured.  It is usually the local legal tender.


For accounting purposes, everything will be represented in USD. In terms of slippage on the conversion, we will have to see. However, the President has stated that the objective here is not to make any sort of profit on this - simply to act as a market maker to facilitate the conversion and make the system work.


----------



## Duke of Marmalade

tecate said:


> However, the President has stated that the objective here is not to make any sort of profit on this - simply to act as a market maker to facilitate the conversion and make the system work.


Well yes, if the government guarantees that there is no spread as it does in the colon/US$ exchange rate then there will be no difference in retail prices based on the denomination of the legal tender being used.  That is going to be one heck of a guarantee to administer.


----------



## DazedInPontoon

Dublinbay12 said:


> there are a number of FinTech competitors closing the gap making it much more affordable (transferwise, worldfirst etc).


Do they support El Salvador, and if so what are the fees like? You can consider Strike one of these competitors.



Dublinbay12 said:


> So I assume the rhetoric on WU relates to workers in the US that are likely to be illegal workers earning cash in hand? ...


I wasn't assuming this.


Dublinbay12 said:


> However, to convert from $ to BTC on a recognized exchange requires a SSN, photo identity which the person is unlikely to be in the possession of or they wouldn't need to use WU in the first place. This will lead to the use of alternative sources to convert $ to BTC with much higher fees than established exchanges such as coinbase.


You might be right if indeed there are a significant number who have no other option of how to get BTC. For others assuming they can use the strike app, the founder is working under the assumption that fees will trend towards zero.


Dublinbay12 said:


> A separate question, I assume the price of goods will be higher in EL Salvador when bought with BTC vs $ to account for the spread built into BTC to account for price risk?


I assume it will be seamless in the app, whether you're paying from a USD stablecoin balance or BTC balance the payment amount would be the same to the recipient either way.


----------



## DazedInPontoon

It's interesting to note some lightning network statistics now (source).  Might be interesting to revisit them in the future and see whether it has grown or not:

Total Capacity:     1,465.74 BTC
Capacity Value:   $51.8M
Total Nodes:         11,817
Total Channels:    49,003


----------



## DublinHead54

DazedInPontoon said:


> Do they support El Salvador, and if so what are the fees like? You can consider Strike one of these competitors.


El Salvadors currency is the USD so the issue is just international transfer costs, whether local banks accept international transfers rather than costs associated with converting currency. 

Could you not either post the money home from the US or use a pre-loaded debit card in El Salvador given it is the same currency? 




DazedInPontoon said:


> I wasn't assuming this.


Who are the users forced to use WU that you referred to?


----------



## DazedInPontoon

Dublinbay12 said:


> Could you not either post the money home from the US or use a pre-loaded debit card in El Salvador given it is the same currency?


Why stop there, you could just fly back to El Salvador and hand them dollars in person!


----------



## DublinHead54

DazedInPontoon said:


> Why stop there, you could just fly back to El Salvador and hand them dollars in person!



Hmm, I suppose you don't have a legitimate answer then.


----------



## DazedInPontoon

I don't have a legitimate answer about how easy it is to send money from the US to El Salvadaor, I'm taking Jack Maller's word for it when he says it's difficult. Difficult enough that he went to live in El Salvador for 3 months because he saw it as the best example of where Strike would be of benefit.

Do you know for sure there are cheap, quick ways of moving money from the US to there or are you just assuming?


----------



## DublinHead54

DazedInPontoon said:


> I don't have a legitimate answer about how easy it is to send money from the US to El Salvadaor, I'm taking Jack Maller's word for it when he says it's difficult. Difficult enough that he went to live in El Salvador for 3 months because he saw it as the best example of where Strike would be of benefit.
> 
> Do you know for sure there are cheap, quick ways of moving money from the US to there or are you just assuming?



We are diverging from the point that EL Salvador accepting Bitcoin doesn't solve the problem of people who are forced to use WU as suggested by Tecate earlier. If anything BTC adoption in this case supports the continued mistreatment of millions of workers in places like the US. 

I don't know, but I was querying that if the currency in EL Salvador is USD then the only blockage is how to get USD into the country rather than also exchange rate risk.


----------



## tecate

Following on from El Salvador's move re. bitcoin - other central american countries are taking notice. Here's the front page of a mainstream national newspaper in Costa Rica:


----------



## tecate

Crypto is currently banned in Tanzania - but the President is now looking to reverse that ban and has instructed the Central Bank to look at ways to engage positively with digital currency. In Paraguay a bill is being put forward next month - which its believed will seek to make bitcoin legal tender in the country.

Meanwhile, in El Salvador, the government are making $30 in bitcoin available to every adult in the country to help them become accustomed to the use of the digital wallet that is being developed.
Additionally, Athena plans to install 1500 Bitcoin ATMs in El Salvador.


----------



## WolfeTone

Front-runner in the New York Mayoral race, Eric Adams, had this to say

"“_I’m going to promise you in one year … you’re going to see a different city,” said Adams. “We’re going to become the center of life science, the center of cybersecurity, the center of self driving cars, drones, the center of bitcoins.”_

Just election sloganeering of course so I take it with a pinch of salt. But it is indicative of the increasing mainstream acceptance of bitcoin.


----------



## tecate

Vice News report on El Zonte/Bitcoin Beach, El Salvador.


----------



## DublinHead54

tecate said:


> Crypto is currently banned in Tanzania - but the President is now looking to reverse that ban and has instructed the Central Bank to look at ways to engage positively with digital currency. In Paraguay a bill is being put forward next month - which its believed will seek to make bitcoin legal tender in the country.
> 
> Meanwhile, in El Salvador, the government are making $30 in bitcoin available to every adult in the country to help them become accustomed to the use of the digital wallet that is being developed.
> Additionally, Athena plans to install 1500 Bitcoin ATMs in El Salvador.



$30 is not great when fees can hit $60+. Given the average GDP of EL Salvador residents is $4,000 per annum, anything other than extremely cheap transactions is too expensive for them. For this to be any kind of success it requires the rollout of the lightning network. 

Interestingly given that BTC fees can be bid up during periods of volatility to allow those who want to sell or buy get their transactions to the front of the line. This pits the relatively poor El Salvadorians against those with large holdings or deep pockets (Wall Street Institutional Investors).


----------



## DublinHead54

WolfeTone said:


> Front-runner in the New York Mayoral race, Eric Adams, had this to say
> 
> "“_I’m going to promise you in one year … you’re going to see a different city,” said Adams. “We’re going to become the center of life science, the center of cybersecurity, the center of self driving cars, drones, the center of bitcoins.”_
> 
> Just election sloganeering of course so I take it with a pinch of salt. But it is indicative of the increasing mainstream acceptance of bitcoin.



With the mainstream adoption of Bitcoin, why is it still so volatile? P.s Bitcoin has long been accepted in NYC


----------



## WolfeTone

Dublinbay12 said:


> With the mainstream adoption of Bitcoin, why is it still so volatile? P.s Bitcoin has long been accepted in NYC



I said it was _indicative_ of _increasing_ mainstream acceptance. 

I never said it had mainstream acceptance. 
It was just an expression of an opinion based on an observation.


----------



## tecate

WolfeTone said:


> I said it was _indicative_ of _increasing_ mainstream acceptance.
> 
> I never said it had mainstream acceptance.
> It was just an expression of an opinion based on an observation.


Quite right. This thing is still early doors - adoption is only getting started. Plot it on an adoption curve and it's right at the beginning.


----------



## DublinHead54

WolfeTone said:


> I said it was _indicative_ of _increasing_ mainstream acceptance.
> 
> I never said it had mainstream acceptance.
> It was just an expression of an opinion based on an observation.



BTC is as accepted in NYC today as it was 4 years ago, they pioneered the acceptance of Crypto companies through the BitLicense. New York has always been crypto-friendly. I remember using BTC ATM machines in the Lower East Side back in 2017. 

So why is BTC still so volatile?


----------



## Duke of Marmalade

Can you hear the echo?
A poster in another thread raised a very interesting possibility.
"If bitcoin shoots for the stars", I quote, the poor of El Sal will be swan-ing around in yachts.  He suggests this is a potential avenue of escape from a corrupt world order that condemns them to eternal poverty.
This poses a big dilemma for dictators in other third world countries.  What if this dream scenario unfolds and their downtrodden citizens miss the yacht?
I can see a rush of said dictators to get on this band wagon whilst bitcoin is still going at a 40% discount to its ATH.
Buy! Buy! Buy!


----------



## tecate

Duke of Marmalade said:


> Can you hear the echo?



What echo would that be Dukey?



Duke of Marmalade said:


> Can you hear the echo?
> A poster in another thread raised a very interesting possibility.
> "If bitcoin shoots for the stars", I quote, the poor of El Sal will be swan-ing around in yachts.  He suggests this is a potential avenue of escape from a corrupt world order that condemns them to eternal poverty.


Just to be clear, the part I underlined - that's not a direct quote from the 'poster in another thread'?


----------



## DublinHead54

Duke of Marmalade said:


> Can you hear the echo?
> A poster in another thread raised a very interesting possibility.
> "If bitcoin shoots for the stars", I quote, the poor of El Sal will be swan-ing around in yachts.  He suggests this is a potential avenue of escape from a corrupt world order that condemns them to eternal poverty.
> This poses a big dilemma for dictators in other third world countries.  What if this dream scenario unfolds and their downtrodden citizens miss the yacht?
> I can see a rush of said dictators to get on this band wagon whilst bitcoin is still going at a 40% discount to its ATH.
> Buy! Buy! Buy!



HAVE FUN STAYING POOR


----------



## tecate

Dublinbay12 said:


> BTC is as accepted in NYC today as it was 4 years ago, they pioneered the acceptance of Crypto companies through the BitLicense. New York has always been crypto-friendly. I remember using BTC ATM machines in the Lower East Side back in 2017.
> 
> So why is BTC still so volatile?


For someone who claims to work in the space, this is particularly clueless. Ask anyone that works in the sector which is the most crypto-unfriendly state in the US and 100/100, the answer will be New York. For most crypto startups, the BitLicense is an unworkable travesty.


----------



## Duke of Marmalade

As I have self exiled from the "hyperbolic" thread I decided to dump this graphic here.
_Wolfie _predicted a BTC price of $33.5k last November.
On 14% of days since then it has been within 5% of the actual closing price, as it is today.  Not bad.
Better would have been $57k which has been within 5% nearly 20% of days.
One understands why he is jealously guarding his methodology.  If everyone knew it he would lose his edge  .


----------



## WolfeTone

Duke of Marmalade said:


> One understands why he is jealously guarding his methodology. If everyone knew it he would lose his edge.



Except my methodology is conditioned on accepting that I have got the price prediction way off the mark also and recognise that it is impossible to time the market.
Who knew when Musk was going to interject and the impact of that?

Speaking of the $57k... I think I mentioned I cashed out some at $54k?... not bad there either I'd say?

In the round, I think it is fair to say that my timing of buying and selling BTC has been good?
As I understand it, there are posters here who feel sorry for people who buy bitcoin at a price above $30k. Such is their concern they want to help people in making the 'right' decision on bitcoin.

If buying BTC above $30k is a bad idea, and they are here to help, why not reveal their methodology in determining why it is a bad idea? @Dublinbay12


----------



## Duke of Marmalade

@WolfeTone I was only pulling your leg.  I am the last one to be casting any nasturtiums at your predictive techniques.  But I will win out in the end.


----------



## WolfeTone

21st Feb 2021 @Dublinbay12



WolfeTone said:


> Well at these prices I had to do some reflection





WolfeTone said:


> my bitcoin holding has become valuable, *way beyond what I thought it could at this point*. The psychology at play in this market is something I have never experienced before





WolfeTone said:


> So I cashed in a portion of my BTC today to cover my outlay and taking an equal sum profit as a feel good factor.



See, I get it wrong alot of the time also.


----------



## DublinHead54

A model based on incorrect predictions and an impossibility to time the market, where can I sign up?!



WolfeTone said:


> Except my methodology is conditioned on accepting that I have got the price prediction way off the mark also and recognise that it is impossible to time the market.
> Who knew when Musk was going to interject and the impact of that?



@WolfeTone it is absolutely hilarious that you accuse me of misquoting or misinterpreting and then you do the same thing. I guess thats a great summary of how you process logic. What applies to others doesn't apply to you eh. I really hope you are just pontificating on an internet forum and don't believe yourself to be some form of Crypto investing rainman.

I have no model for valuing Bitcoin or other Cryptocurrencies, nor do I claim to. However, that has not prevented me from making and losing money. I put this mostly down to luck, I invested in Ethereum at $17 and Bitcoin at $1,000, I've tried to actively trade crypto multiple times, I was heavily involved in ICOs, you name the altcoin and I probably owned it. I had some wins and some losses, but nothing will ever beat the return I got from getting lucky with my timing to enter the market. I assume my non-modelled method has been more successful than your model. 

I don't believe there is an accurate model for valuing Bitcoin, for the main reason you point out..... you can't predict what Musk is going to tweet. So it is surprising you continue to claim you have a model when also admitting you can't time the market or anticipate the impact due to tweets etc.

From an investment perspective, you should understand that none of this prevents an individual in assessing the risk of an investment. For example, this is why when selecting a fund in your pension you base it on the 'risk rating' not the methodology used price the underlying instruments. My objective in the other thread has never been to provide a valuation technique, so please stop incorrectly inferring that it was. I've asked you multiple times to provide feedback, but you'd rather just follow Tecates queues and not engage. At the beginning I thought, you were choosing not to, but I've come to the understanding that it's because you don't have the knowledge.


----------



## WolfeTone

Dublinbay12 said:


> I have no model for valuing Bitcoin or other Cryptocurrencies, nor do I claim to. However, that has not prevented me from making and losing money. I put this mostly down to luck, I invested in Ethereum at $17 and Bitcoin at $1,000, I've tried to actively trade crypto multiple times, I was heavily involved in ICOs, *you name the altcoin and I probably owned it.* I had some wins and some losses, but nothing will ever beat the return I got from getting lucky with my timing to enter the market.



So you are a complete gambler and a chancer. Now you are proffering to want to help others make informed investment decisions in the crypto space! All the while;



Dublinbay12 said:


> I don't believe there is an accurate model for valuing Bitcoin



Neither do I, nor did I ever proclaim to have. It is why I am not hear to offer advice or offer to help. I am simply offering opinion. What I said was I use my own model for interpreting such things as monetary policy of central banks (which I think is pertinent to bitcoin). If I feel that a particular policy will increase the price of bitcoin then I am more likely to consider buying it.  I may turn out to be wrong, but that is the model I choose to use when considering buying or selling bitcoin. There are numerous other factors and sources. I listen to people who work in the area on the tech side, I listen to the economists, including Roubini. I listen to the policy makers and the regulators. I hear a lot of claims about 'crackdowns' and 'banning bitcoin', but when I tune into the policy makers and regulators, in the States for example, I hear a totally different tune.
I listen to the environmentalists and the fear about bitcoin energy usage and boiling the ocean and then I listen to bitcoin miners themselves and the innovation going into harnessing abundant clean renewable energy.

I read the predictions of people who know far more than me as kindly presented by @Duke of Marmalade

These are predictions from folk who know a lot more than you or I

And I decide if what they have to say has any merit or not. Then I make a decision whether to buy or not.




Dublinbay12 said:


> For example, this is why when selecting a fund in your pension you base it on the 'risk rating' not the methodology used price the underlying instruments.



Again, that is your opinion. My opinion would be a little bit more nuanced. I would be inclined to think that if selecting a fund for your pension that you _may_ base it on the 'risk rating'  but that you would be well advised to scrutinize to some degree the methodology used to price the underlying instruments for yourself.


----------



## DublinHead54

WolfeTone said:


> So you are a complete gambler and a chancer. Now you are proffering to want to help others make informed investment decisions in the crypto space! All the while;



This shows that you don't understand risk. You think because I said I owned altcoins...that I gambled, which infers you think the cryptocurrency market can be like gambling? Much like you I cashed out my original stake, so to follow on the gambling analogy, I was playing with house money.... My overall initial investment in Cryptocurrency was based on a portion of my portfolio that I was willing to risk. I knew full well that I could lose my investment, but at no point did I ever invest money that I was not prepared to lose. So no, it wasn't gambling, nor was there a model.



WolfeTone said:


> Neither do I, nor did I ever proclaim to have. It is why I am not hear to offer advice or offer to help. I am simply offering opinion. What I said was I use my own model for interpreting such things as monetary *policy* of central banks (which I think is pertinent to bitcoin). If I feel that a particular *policy will increase the price of bitcoin* then I am more likely to consider buying it.



This is just simply contradictory. You don't have a way to value Bitcoin, yet you have a model that provides the change in value in Bitcoin based on input parameters and your opinion?!

Lets look at an example based on some of the comments you have made.

You said Bitcoin is worth $34,500 back in November 2019. Bitcoin was trading in the region of $8-10k back then. You took your model based on interpretation of monetary policy and other various sources. You interpreted the information available at that time, put it into your model and came to the opinion that due to those interpretations Bitcoins value will change by ~25k to $34,500.

Can't you see it is contradictory to say you don't have a way to value Bitcoin, then in the next sentence say you have a model that estimates the change in the value of Bitcoin?!

I know on an internet forum it's easy to stick to your guns, but look for the sake of our sanity, I'm not going to hold this over your head if you just admit you don't have a model.


----------



## WolfeTone

Dublinbay12 said:


> My overall initial investment in Cryptocurrency was based on a portion of my portfolio that I was willing to risk





Dublinbay12 said:


> you name the altcoin and I probably owned it


 
It sounds like that no matter what was on sale you were having a bit of it. Did you not even try to understand what the alt coins were?


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## tecate

WolfeTone said:


> It sounds like that no matter what was on sale you were having a bit of it. Did you not even try to understand what the alt coins were?


He can't even clarify the rationale behind him (alegedly) holding bitcoin - what chance he can provide any clarity on anything else.

#ButImNeutral


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## WolfeTone

Dublinbay12 said:


> I'm not going to hold this over your head if you just admit you don't have a model.



Ok @Dublinbay12 I think I see where you are going with this. What you are stating is that I don't have a devised mathematical formula, where I input all the data and out pops a result that I use to value bitcoin?
You would be almost correct in that regard. I do have a crude mathematical formula but it is only as guidance and very incomplete.

What I do have is interpretation of a considerable amount of sources that either guide me into thinking that bitcoin is undervalued or it is overvalued. For instance, its hyperbolic price rise to $60K made little sense to me, over the short space of time it bore hallmarks of a mania, to me, in my opinion.
That said, the Duke opened this thread with bitcoin at roughly $25k(?) declaring its price to be 'hyperbolic' at that point. I on the other hand remained as bullish as I did in Nov 2020, and as it transpired bitcoin did reach $34500 shortly afterwards.

Yet, given your neutral stance, I don't see the same level of interrogation of Dukes 'hyperbolic' valuation? Why is that? And you yourself have declared to be 'sorry' for all those who buy btc over $30k. How have you come to this reasoning if there is you have no model to value bitcoin? Is it just a guess on your part? Seems like it. In which case, you are somewhat the charlatan to be professing to help others with sound investment advice in the crypto space.


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## tecate

WolfeTone said:


> Yet, given your neutral stance, I don't see the same level of interrogation of Dukes 'hyperbolic' valuation? Why is that?


Its a special type of neutral - we wouldn't understand it.


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## DublinHead54

WolfeTone said:


> It sounds like that no matter what was on sale you were having a bit of it. Did you not even try to understand what the alt coins were?


How did you infer that? Yes of course I did my research. I note you're trying to change the topic and twist the context. If you want to change the topic to discuss my investment in altcoins can we please first closet out the other discussion?


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## DublinHead54

WolfeTone said:


> Ok @Dublinbay12 I think I see where you are going with this. What you are stating is that I don't have a devised mathematical formula, where I input all the data and out pops a result that I use to value bitcoin?
> You would be almost correct in that regard. I do have a crude mathematical formula but it is only as guidance and very incomplete.
> 
> What I do have is interpretation of a considerable amount of sources that either guide me into thinking that bitcoin is undervalued or it is overvalued. For instance, its hyperbolic price rise to $60K made little sense to me, over the short space of time it bore hallmarks of a mania, to me, in my opinion.
> That said, the Duke opened this thread with bitcoin at roughly $25k(?) declaring its price to be 'hyperbolic' at that point. I on the other hand remained as bullish as I did in Nov 2020, and as it transpired bitcoin did reach $34500 shortly afterwards.
> 
> Yet, given your neutral stance, I don't see the same level of interrogation of Dukes 'hyperbolic' valuation? Why is that? And you yourself have declared to be 'sorry' for all those who buy btc over $30k. How have you come to this reasoning if there is you have no model to value bitcoin? Is it just a guess on your part? Seems like it. In which case, you are somewhat the charlatan to be professing to help others with sound investment advice in the crypto space.



So you do have a model for valuing bitcoin?


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## WolfeTone

Dublinbay12 said:


> Should be a simple yes/no?



Yes. But you almost had me convinced that I didnt.


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## WolfeTone

Dublinbay12 said:


> If you want to change the topic to discuss my investment in altcoins



No, I can assure you I have no real interest in this at all. I merely passed a comment as an observation from your previous comment that 



Dublinbay12 said:


> you name the altcoin and I probably owned it



I'm happy to leave the prospect of that discussion for another time, thanks.


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## DublinHead54

WolfeTone said:


> Yes. But you almost had me convinced that I didnt.


You did a good job of that yourself! Back to my very original point. Given you've now admitted you have a model that includes a crude mathematical approach. Can we hear your price prediction for BTC in the next year?


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## WolfeTone

Dublinbay12 said:


> Can we hear your price prediction for BTC in the next year?



Yes, but reading that Fed Reserve nonsense again, I will have to make some adjustments.


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## tecate

Dublinbay12 said:


> Can we hear your price prediction for BTC in the next year?


No offence to Wolfie but I think we should approach matters sequentially. How about you tell us what your rationale is for holding bitcoin? That item is outstanding since 2020. 

Would you recommend the Duke holds bitcoin? He might consider it if - as a neutral - that rationale comes from you.


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## Duke of Marmalade

tecate said:


> Would you recommend the Duke holds bitcoin? He might consider it if - as a neutral - that rationale comes from you.


With all due respect to @Dublinbay12 I will take my guidance from a very eminent professor


			
				Professor Roubini said:
			
		

> _bitcoin is not a currency
> it is not a medium of exchange
> it is not a unit of account
> Proof of Work is obscenely inefficient
> it is not scalable
> it has no regulatory oversight
> it has no assets
> it has no income
> it is not a store of value
> it is a speculative bubble _



This guy commands respect:


			
				Wiki on Professor Roubini said:
			
		

> Roubini is one of few economists who predicted the housing bubble crash of 2007–2008. He warned about the crisis in an IMF position paper in 2006. Roubini's predictions have earned him the nicknames "Dr. Doom" and "permabear" in the media.  In 2008, _Fortune_ magazine wrote, "In 2005 Roubini said home prices were riding a speculative wave that would soon sink the economy. Back then the professor was called a Cassandra. Now he's a sage". The _New York Times_ notes that he foresaw "homeowners defaulting on mortgages, trillions of dollars of mortgage-backed securities unraveling worldwide and the global financial system shuddering to a halt". In September 2006, he warned a skeptical IMF that "the United States was likely to face a once-in-a-lifetime housing bust, an oil shock, sharply declining consumer confidence, and, ultimately, a deep recession". Nobel laureate Paul Krugman adds that his once "seemingly outlandish" predictions have been matched "or even exceeded by reality."[/quote]
> It is of course possible that given the anonymity of this blog that either or all of @Dublinbay12 , @tecate or @WolfeTone can match these impressive credentials.  Most likely is @WolfeTone who appears to have developed a "nuanced" model for predicting BTC prices which has had an impressive record if not quite up to the professor's prediction of the financial crisis.


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## DublinHead54

WolfeTone said:


> Yes, but reading that Fed Reserve nonsense again, I will have to make some adjustments.



I think I should get a share of your profits after giving you a heads up that the largest component of your model made a massive announcement you were unaware off. I hope you don't have to go back and retract some of your opinions. Nevertheless I doubt we'll get a prediction with any certainty given you admit your model is crude, based of inaccurate price predictions, gets things wrong and can't time the market. 

I'll just take the simple wins though and be grateful you finally provided clarity. 

I'll retire from this thread, Have a great weekend. 

P.s if you do want to share your profits, pm and I'll send you my bitcoin address.


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## tecate

Duke of Marmalade said:


> With all due respect to @Dublinbay12 I will take my guidance from a very eminent professor _bitcoin is not a currency_
> 
> This guy commands respect:


All the more reason though for @Dublinbay12 to clarify. He is the first active participant to declare himself neutral above all others - whilst telling us he holds bitcoin. There must be something unique and interesting here as i have never seen an instance where he expressed anything positive about the world's foremost decentralised cryptocurrency. In fact in 2020 he openly ridiculed the notion of the decentralised element of the currency. It would be fascinating to hear how someone who sees no value in decentralisation relative to a digital asset  can justify or see value in holding it.

If you're not suitably impressed by the response Duke, then you can resume your attendance at the Roubini school of Wahhabist Indoctrination.


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## WolfeTone

WolfeTone said:


> US inflation, reasons to be worried
> 
> Here is one for the CB cultists. The language in this says it all. But due to the life-long indoctrination, the faith, it passes for reasoned logical comment.
> Not so much the commentator himself but rather the comments from CB.
> 
> In case you hit a paywall;
> 
> "_It would be fair to conclude that inflation expectations are moving up. But, at current levels, they will not concern the Federal Reserve all that much..."
> - _Well, that's ok then. As long as CB is not concerned then there is nothing for anyone to be concerned about?
> 
> _"... as Jay Powell, Fed chair, said last August, “we will seek to achieve inflation that averages 2 per cent over time. Therefore, following periods when inflation has been running below 2 per cent, appropriate monetary policy will probably aim to achieve inflation moderately above 2 per cent for some time.” _
> 
> What is he talking about? What does "averages over 2 per cent over time " mean? How much time is he talking about?
> 
> "_Therefore, following periods when inflation has been running below 2 per cent, appropriate monetary policy will probably aim to achieve inflation moderately above 2 per cent for some time.” _
> 
> So how long has this period of inflation to last? What is 'moderately above 2%'?
> 
> Here we go:
> 
> "_Because inflation has fallen short of the goal by a cumulative total of 5 percentage points since 2007, this could justify, say, 3 per cent inflation for five years, before a return to 2 per cent." _
> 
> So having failed to reach a 2% target on average over the last 14yrs (average was 1.65%, or 17% short of the target on average, every year, for 14yrs) it is now suggested that a 3% would be sustainable for 5yrs before returning to 2% (the target that has not sustained for 14yrs).
> 
> Perhaps I'm being a little harsh? Perhaps an average of 1.65% instead of average of 2% over 14yrs isn't such a bad result considering the innumerable variables of an economy so big?
> On the face of it probably not, not to the faithful anyway. But are there any other factors worth considering? The commentator highlights four factors of concern. This is the most significant.
> 
> "_The government and substantial swaths of the private sector have huge debt liabilities and borrowing plans." _
> 
> So while CB's were celebrating and congratulating themselves on 'managing' inflation, that inflation was being exported as debt onto the balance sheets of sovereign, corporate and individuals disproportionately boosting asset prices.
> 
> Speaking of volatility, it is said here that the depreciation of US$ is 2% pa over the long term.
> 
> Somewhere between 20-25% of all US dollars circulating were printed into existence were in 2020.
> In order to sustain an average 3% inflation rate over next 5yrs, CPI basket of goods will have to near double in price in that period.
> 
> Good luck 'managing' that (average) 3% inflation rate target.





Dublinbay12 said:


> massive announcement you were unaware off.



What are talking about? I was aware of the policy before the official announcement. From last May, page 40 - Hyperbolic thread.

Keep up man!


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## DublinHead54

WolfeTone said:


> What are talking about? I was aware of the policy before the official announcement. From last May, page 40 - Hyperbolic thread.
> 
> Keep up man!


Wolfie, not only do you have a model to predict the price of bitcoin to a "near bullseye". But you also saw into the future last may to know that in June 2021 the FRB would "change their policy" and bring forward their schedule for raising rates. All this whilst in the middle of a global pandemic. You are wasting your talents on this forum! 

Tell me this, whats the euromillion numbers for tonight?


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## tecate

Dublinbay12 said:


> Tell me this, whats the euromillion numbers for tonight?


It seems we stand a far better chance of getting the winning euromillions numbers from Wolfie than a smidgen of honesty from you in this discussion.

What is your rationale for holding bitcoin? Should Duke own some based on that rationale - whatever it is?


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## WolfeTone

Dublinbay12 said:


> Wolfie, not only do you have a model to predict the price of bitcoin to a "near bullseye".



Do I? Since when? I know I made a prediction last Nov 2020, based on my model, that to all intents and purposes was "near bullseye" within 2 months.
But I'm pretty sure I've mentioned how my predictions have been way off the mark too? Did you skip by those comments? You know the one where it actually went to $54k and I cashed out a portion because it was way beyond my prediction?

Even though did rise to $60k, think of all the people that you think follow my lead and dodged a price crash.
Isnt that right? You feel 'sorry' for anyone buying bitcoin over $30k based on my predictions - I sincerely doubt anyone has because outside your good self you seem to be the only one who considers my posts as financial advice 
But somewhat inconveniently for you, by following my activity and selling at $54k, they would have made a tidy profit.

Tell me again, why do feel 'sorry' for anyone buying bitcoin over $30k?



Dublinbay12 said:


> But you also saw into the future last may to know that in June 2021 the FRB would "change their policy" and bring forward their schedule for raising rates.



What are you talking about? The link to the Fed Reserve quoting Powell was from last May, and his quote was from the previous August.
Surely anyone awaiting


Dublinbay12 said:


> one of the most important pieces of information in the global financial system



would have some sort of inkling of the policy approach in advance of any official announcement? Surely?? Please don't tell me you had no prior knowledge of what was being piped by official channels through the media, for MONTHS in advance?


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## DublinHead54

WolfeTone said:


> .
> 
> would have some sort of inkling of the policy approach in advance of any official announcement? Surely?? Please don't tell me you had no prior knowledge of what was being piped by official channels through the media, for MONTHS in advance?


Wolfie you continue to astound me with your lack of knowledge but shear belief you are right despite how much you contradict yourself in every post. 

I give up, I can't handle your contradictions any longer.


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