 | Here’s the ideal progression of a Bitcoiner:
The last item is critical, and you’ll understand why by the time I get done educating you. Bitcoin’s distribution is fixed and predictable; there’s a block mined once every ten minutes and inflation is adjusted once every four years in an event known as halving. The block reward currently is 6.25 BTC. Since blocks are mined once every ten minutes, that’s 6 blocks an hour, and 144 blocks every day. That means 900 BTC are mined each day. The current price of BTC is $50,000. So why is this relevant? Because of this: $45,000,000 worth of new BTC is hitting the open market every day. Think back to May of last year just before the most recent halving. There were 1800 blocks being produced a day at an average BTC price of $7500, meaning $13,500,000 of new BTC was being produced daily. And if that would’ve remained the same after the halving, it would’ve been $6,750,000. That’s why anyone that understood this stuff knew immediately that was the last chance to ever buy BTC under 5 figures. Michael Sailor was all over it, and a maxi I knew literally sold his house under market value, moved into an Airstream trailer, and sold me his motorcycle on the cheap. He made the wise decisions, me not so much, although I’ve been dollar cost averaging in for many years. So armed with this knowledge, you should understand immediately why halvings are so important, and why BTC fights an existentially tougher battle to maintain its price each time it moons to all time highs. You should also see why it’s so volatile at times, and why with enough time, that will go away too. There is no better investment than BTC longterm, and I’m convinced people should dump 50% of their IRA’s and 401k’s in favor of a Trezor, Ledger, or Coldcard hard wallet. This is an asset you build generational wealth with, and pass on to your children. Now about those orange pills… Adoption is the only thing that matters. The Matrix-related orange pill meme was developed literally because maxi’s realized many years ago that absorbing bitcoin’s inflation would lead to exponential price growth. Supply and demand. That’s it. That’s why it’s played out so favorably and consistently. That’s what’s governed it for 13 years. And in those years, when was the best time to sell bitcoin? NeverAnd if you did sell, you missed out huge. This is an asset that rewards HODLers and relentlessly punishes traders. I authored a post recently explaining why even if you guess the longterm direction correctly trading bitcoin, you’ll lose money, and if you’re leveraged, you’ll almost certainly go broke. I highlighted this with a gold/Papiermark chart from the Weimar Republic. Most traders who correctly bet against this famously hyperinflating currency went broke, especially the leveraged ones. Look at the chart. The volatility was too extreme and the directional velocity was too slow. Don't be these people, out-HODL volatility and the US dollar THERE IS NO MANIPULATIONMost of bitcoin social media is contaminated with this conspiratorial nonsense of manipulation right now. Several fine bitcoiners newer to the space have reached out, PM’ing me with these talking points. It’s starting to feel like a meme-stock sub or QAnon get together in Wyoming where “shorts haven’t covered yet”, and Trump is only weeks away from being restored to the White House. What you’re seeing are bitcoin’s very own dynamics playing out, not the workings of George Soros Bitcoin isn’t gold which has physical borders it can’t traverse. It’s not gold which can’t be used for settlement. It’s not gold that coming out of Bretton Woods, saw 70% of reserves held in custodial vaults in the US. It’s not OPEC which controls 80% of the world’s Brent crude production. It’s not a stock of which more than half is owned by board members and executives who on a whim can issue bonds, issue more shares, issue commercial paper, draw on massive credit facilities, and restructure share classes. In order to control and manipulate something global worth trillions of dollars in a meaningful way longterm, you have to have ownership of a very large portion of that underlying asset, preferably more than 50%, because if it exists in a truly free market, your attempts at control would be equivalent to selling naked calls or naked puts. One fast move in either direction and you’re bankrupt. There’s too much game theory to try for delta-neutral positions either, which would require enormous amounts of money and faster devaluation (printing) of the currency you were using to achieve this. And this all assumes it never moved up in value. The more it does that, the more out of reach this becomes, eventually being the thing that’s margin calling you. Bitcoin is open source. It’s decentralized. It’s free market. It trades globally 24/7. It’s permissionless. Its distribution is fixed and predictable. It’s pseudonymous. Verifiable. It’s impairment resistant. It’s a store of value, a currency, and a central bank, in one singularity. It’s full-stack is sophisticated, impossibly simple, beautiful, and looks like something you’d expect of 20-years worth of work from the cypherpunks that gave us encryption. 2% of the global population owns bitcoin. On most technology adoption curves, 13% is still considered “early adopter”. So we have plenty of time, and a bunch of orange pills to slip into drinks, place on tongues, and press into palms. Gary Gensler (SEC Chair) is going to drop the hammer on pre-mine altcoins and stablecoins early next year. This video cracks me up: https://twitter.com/HODLneverSODL/status/1468495579663769600?s=20 This will benefit bitcoin in enormous ways. Gensler is friendly to bitcoin regardless of what you might've heard, and taught BTC and blockchain courses at MIT when he was a professor there. Not everything is rosy though. A massive Mt. Got distribution is coming next year which will not be beneficial to BTC, at least in the short-term. Otherwise the only other going concern might be an invasion of Ukraine by Russia in the dead of winter that could spike energy prices 50% and cause the bitcoin mining economy of scale enough trouble the leveraged ones distribute their coins too. Be prepared to buy the dip. There’s only 21M of these things, which isn’t even enough for everyone in the state of Florida, let alone the US, let alone the whole world. Conclusion:Stack your bitcoin. Act broke. Have more than you show. And say less than you know. P.S.My PM's are always open for anyone wanting to talk through the complications of bitcoin. G'day [link] [comments] |
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