Sunday, July 25, 2021

Bitcoins And Bolivars: Two Hot Potatoes

by Michael Pento, Market Oracle:

It was just a little more than a decade ago when “Satoshi Nakamoto” ushered in what has become the era of private cryptocurrencies. Nakamoto’s vision was clearly laid out in a whitepaper: “Bitcoin: A Peer-to-Peer Cash System.”

Nakamoto’s bitcoin money machine—or as Larry White refers to it: a private “algorithmic central bank”—was going to wipe out the inflation risk and the accompanying loss of purchasing power that plague fiat monies issued by government-controlled central banks. Alas, bitcoin’s source code that predetermines its supply is set on a fixed-quantity path that is unresponsive to changes in demand. In consequence, bitcoin inhabits a demand-supply space in which supply is almost perfectly inelastic. So, to reach a demand-supply equilibrium, all the adjustment falls on the back of bitcoin’s price (read: purchasing power). As a result, bitcoin’s price is inherently volatile and unstable. Indeed, small changes in demand in the face of an inelastic supply create a price volatility storm. Furthermore, unless more demand can be attracted to bitcoin, there is no reason why its price should trend upwards, as many have been led to believe. If speculation wanes, bitcoin’s price could trend downwards. Indeed, bitcoin’s design guarantees volatility, which inhibits its widespread use. In short, it is very risky to hold bitcoins or accept them for deferred payments.

Bitcoin: Revolutionary Money in a Time of Universal Deceit

by Nozomi Hayase, Consortium News:

In the cryptocurrency’s decentralized network, Nozomi Hayase says those who seek to conspire in secret have no place to hide, as Bitcoin aids WikiLeaks’ mission to keep governments transparent and honest.

George Orwell is reputed to have said, “In a time of universal deceit, speaking truth to power is a revolutionary act.” Over a decade ago in the spring of 2010, WikiLeaks burst onto the global stage with the publication of the “Collateral Murder” video that depicted the U.S. military gunning down Iraqi civilians and Reuters journalists on a street in New Baghdad.

Doug Casey: How I Learned to Love Bitcoin, Part II

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by Doug Casey, International Man:

In all of Africa, most of South America, and a great part of Asia, fiat currencies issued by governments are a joke. They’re extremely unreliable within those countries. And they’re totally worthless outside the physical borders of the country. That’s why those people now want dollars. But those are physical paper dollars. And governments everywhere are trying to eliminate physical currency.

I think, therefore, that the Third World will adopt Bitcoin in a huge way.

That’s not just because people who own cryptocurrencies are currently making money. They’re saving an appreciating asset rather than a depreciating asset. You’re on a Sisyphean treadmill if you try to save a Third World currency—but three-fourths of humanity has no alternative. Nobody in these backward places wants to save the worthless local currency—but, by law, that’s typically their only option. Billions will try to get into Bitcoin.

These coins are also private. They can transfer wealth outside of the country, which is very helpful. Kwachas, pulas, pesos, and such are worthless outside of the countries that issue them. Of course, governments hate that, and this will present a big problem down the road. Governments hate Bitcoin. It gives their subjects a huge measure of extra freedom.

The whole Third World is going to go to these cryptocurrencies. They all have smartphones in these countries. A phone is the first thing they buy after food, shelter, and clothing. Bitcoin will become their savings vehicle.

Sure, it’s a bubbly market. But soon billions more people will be participating in it. So, it’s going to get more bubbly. That’s my argument for the bubble getting bigger, and the prices of quality cryptos going higher.

But like I’ve said, cryptocurrencies are just the first application of blockchain technology. I think they have staying power simply because government fiat currencies are bad, and will be getting worse. They’re not going away. But I view them mainly as a speculative opportunity right now.

How high is Bitcoin going to go? Bitcoin is kind of the numeraire. It’s the gold standard, as it were, of cryptocurrencies. John McAfee, who founded the cyber security giant McAfee, Inc., thinks it’s headed much higher. He thinks Bitcoin’s going to $50,000.

That sounds outrageous, but it’s entirely possible. Another 10-1 in a manic market is possible—although it brings up thoughts of tulip bulbs, of course.

Remember, Central Banks all over the world are printing up fiat currencies by the trillions, desperately trying to put off a collapse of the world economy. Many will issue their own cryptos—they’re trying to totally abolish paper cash as we speak. And they won’t want competition from private currencies like Bitcoin. Governments may well try to outlaw peer-to-peer cryptos.

That’s a topic worth exploring. Governments are going to get into these currencies in a big way. But only their own versions, probably making private cryptos like Bitcoin illegal. With paper cash no longer available, they’ll then be able to track absolutely everything that’s bought and sold.

At that stage—which is in the near future—the blockchain tech will have gone from one of the biggest pro-freedom innovations to one of the most repressive. Like gunpowder—first a liberator for the average man, then a means to suppress him. That said, technology, in the long run, is eventually always a liberating force.

Read More @ InternationalMan.com

Is Bitcoin Strangling The Other Cryptos? Part 2: The Little Guys Are Soaring

by John Rubino, Dollar Collapse:

The idea that “bitcoin is its own asset class” and should therefore be judged based on its own highly-constrained supply rests on the assumption that the rest of cryptospace consists of “shitcoins” that will evaporate as bitcoin, with its first-mover advantage, network effects, etc., eats the rest of the currency world and becomes the one true reserve asset.

The following chart shows the 7-day moves of some of the no-names in the space. All are below $1 billion in market cap (though several hundred million is still real money, even in this hyperinflationary world), so they’re not yet serious contenders for much of anything, let alone reserve currency status.

Bitcoin conference unable to accept payment in bitcoin

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from RT:

People hoping to attend an upcoming conference dedicated to cryptocurrencies have been told they must pay for their tickets in regular old dollars because using crypto is too slow and expensive.

The North American Bitcoin Conference (TNABC), which will be held in Miami next week, said on its website that it has closed payments using bitcoin and other cryptocurrencies due to network congestion and manual processing.

READ MORE: Russia’s largest bank opens blockchain lab

“Due to the manual inputting of data in our ticketing platforms when paid in cryptocurrencies, we decided to shut down bitcoin payments for last minute sales due to print deadlines,” the organizers said.

“Hopefully, next year there will be more unity in the community about scaling and global adoption becomes reality.”

Rising transaction fees and lengthy processing times have been a big bone of contention in the crypto community in recent times and organizer Moe Levin told Bitcoin.com that they also made it difficult for the conference to accept digital currency.

According to Blockchain.info it currently takes more than 50 minutes to confirm a bitcoin transaction.

“We wish this was easier, but no ticketing options exist which can handle large volumes of ticket sales, and transaction fees on the Bitcoin blockchain exceed $30 at certain times of the day,” Levin said.

Read More @ RT.com