Category Archives: Bitcoin
Is Bitcoin Decoupling From Treasurys, Equities And Bonds? – Bitcoin Magazine
The below is a direct excerpt of Marty's Bent Issue #1271: Soaring rates, begging and bitcoin's relative strength. Sign up for the newsletter here.
Last week, we discussed the fact that credit default swap spreads for sovereign nations are becoming completely detached from their historical averages. In that piece, we highlighted that rapidly rising rates will begin to have a material effect on the interest payments on sovereign debt. Our friend Lawrence Lepard did some rough calculations on the exact impact this type of high-rate environment will have on the amount of money the U.S. government will owe their counterparts in interest payments if rates continue to rise. At this rate, interest payments will be about 3.5 times what they were in 2020. Of course, this won't happen right away as a lot of these Treasurys need to mature. However, if you take a look at the maturity calendar, a considerable amount of these Treasurys are due to mature over the next two years.
While interest payments on the U.S. sovereign debt may not balloon to $1.2 trillion immediately, they will begin to increase materially in pretty short order. This is happening as tax revenues are all but certain to fall dramatically as Americans attempt to deal with a rate of inflation that is screaming far beyond whats reported via the consumer price index; and as capital gains tax revenues dry up as most will probably have to report losses on their stock portfolios and home sales. Anyone with a lick of common sense and rudimentary math skills can see that this problem is about to have a material effect on peoples confidence in the U.S. governments ability to pay its debts and, by extension, overall confidence in the U.S. ability to be the leader of the Western world. It doesnt matter how much the DXY rallies.
Not only that, but everyone who has become wholly dependent on the easy money gravy train that left the station in 2008-2009 is literally beginning to beg for the Federal Reserve to reverse course on their hawkish policy. In the last three weeks alone, weve seen the U.N., the International Monetary Fund (IMF) and ARK Investments Cathie Wood come out and ask the Fed directly and indirectly to reverse course.
We find ourselves in very weird times. Everyone from the U.N. to the IMF to large asset managers is coming out and admitting that their way of being is wholly dependent on the gravy train barreling down the tracks at full speed. They have built their worldview around a dependence on central planning and free money flows that push up the prices of the assets they own and lull the world into a false sense of security. Markets have been forced to quit their heroin addiction cold turkey and the withdrawal shakes are more violent than anyone could ever imagine they would be. The world is wandering into uncharted territory. As the heroin addicts beg their dealer to give them their fix, bitcoin is quietly showing relative strength in the background.
As those in the mainstream continue to pooh-pooh $18,000-$20,000 bitcoin after an approximately 75% fall from highs attained late last year, the nascent peer-to-peer digital cash system seems to be developing a stable base as everything around it begins to crumble at an increasing pace. This is something to keep an eye on in the weeks and months to come. Who knows whether or not this relative stability will continue moving forward? If it does, while everything else continues to crash, it would be a massive signal that there are likely more and more individuals out there recognizing the value proposition that bitcoin provides as a monetary good divorced from the whims of the central planners who have lit the world on fire.
Could the decoupling be upon us? We shall see.
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Is Bitcoin Decoupling From Treasurys, Equities And Bonds? - Bitcoin Magazine
Cryptoverse: Hack jitters push bitcoin investors back to the future – Reuters
Oct 11 (Reuters) - It's not easy being a crypto investor.
They've seen the value of their holdings drop like a brick this year, and now many are stewing over the safety of their crypto cash after a series of heists that's seen around $2 billion spirited away by hackers.
Enter the ghost of technology's past.
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Hardware wallets - old-school physical devices similar to USB drives that stash crypto holdings offline - might seem a throwback to a more innocent digital age, but they're proving to be a popular response to a cutting-edge conundrum.
The global hardware wallet market, valued at $245 million in 2021, is expected to swell to over $1.7 billion by 2030, according to market research firm Straits Research.
It's being fueled by a steady stream of cyber robberies that, according to researcher Chainalysis, has seen thieves steal $1.9 billion in crypto in the first seven months of the year, an increase of 60% from a year earlier. Much of this was stolen directly from blockchains or "hot" online wallets.
It's not only hacks making investors edgy. Others lost access to their crypto when major lenders such as Celsius Network and Voyager Digital collapsed in July.
"We have definitely seen increased interest in hardware wallets, and in general self-custody, post-several issues," said Adam Lowe, chief product and innovation officer at U.S.-based CompoSecure (CMPO.O), one of several hardware wallet makers seeking to capitalize on a rush for safety.
"The day of or day after those events, we would see very significant (sales) lifts."
There's no such thing as a free crypto lunch, though: While hot wallets are convenient and allow for quick trading, hardware wallets typically don't appeal to first-time investors, who often buy cryptocurrencies on big exchanges and might choose to keep their assets on those platforms, where they can simply log in with a username and password.
Although hot wallets are usually free and offer quick access to crypto, they can be vulnerable to hacks. In August, nearly 8,000 crypto wallets on the Solana blockchain were hit by hackers who made off with more than $5 million in crypto.
"Users are strongly encouraged to use hardware wallets," Solana said at the time.
France's Ledger, another hardware wallet maker, said it saw a spike in sales after the Solana wallets heist.
"We do see significant uptick in user-based interest in some of these situations of stress in the markets," aid Alex Zinder, global head of Ledger Enterprise.
Most hardware wallets connect to a mobile app, where the owners of the digital keys needed to access their crypto keys can control their funds. Some use "Secure Enclave" technology, a security feature used to store sensitive data.
Josef Ttek, bitcoin analyst at Czech-based hardware wallet company Trezor, says he expects better phone interaction with cold storage wallets in the future, to serve investors in places like South America and Africa, where it's more common for users to have mobile phones than personal computers.
Yet companies in this ballooning market might be advised to make hay while the sun shines.
One long-term question is whether phone makers will want to get in on the action, said Stan Miroshnik, co-founder and partner at 10T Holdings, which led Ledger's $380 million Series C funding round last year.
"One question, I think, for the industry and where it's going and in part what will drive consumer adoption, is what if every iPhone has a built-in Secure Enclave hardware wallet?"
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Reporting by Hannah Lang in Washington; Editing by Tom Wilson and Pravin Char
Our Standards: The Thomson Reuters Trust Principles.
Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.
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Cryptoverse: Hack jitters push bitcoin investors back to the future - Reuters
The charts of Tesla, Ark and bitcoin are all flashing the same big warning for investors – CNBC
The charts of bitcoin, Tesla and Ark Innovation ETF are all showing the same thing: That the market for the some of the riskiest holdings is at an inflection point. That could be a warning sign for the broader market as well. Jonathan Krinsky, chief market technician at BTIG, says all three are testing key chart areas that look ready to break, taking prices lower. They are all on the "cusp of cracking key levels," he says. Tesla closed Tuesday at $216.50, below the important $220 level. Ark briefly broke below the key $35 level Tuesday, before rebounding to close at $35.65. Bitcoin is nearing a test of $18,000, Krinsky notes. "They were leadership on the way up...They've generally been leading to the downside," said Krinksy. Krinksy said the group's behavior backs his call for more downside for the S & P 500, which closed at 3,588 Tuesday. "I do think the S & P 500 is vulnerable to 3,400," he said. "I'm not bearish on the S & P simply because of these charts, but they do add to the conviction." Bitcoin, just below $19,000 Tuesday on Coin Metrics, could fall to $14,000, if the $18,000 level doesn't hold, he said. "I think it speaks to the Nasdaq, and I think it will eventually translate to the S & P 500," said Todd Sohn, technical analyst at Strategas. "The weakness from one area will leak to the S & P." Sohn described Ark, bitcoin and Tesla as emblems for the "speculative corner of the market." "Ark and bitcoin bottomed earlier in the summer, and they kind of treaded water since. Now, they're starting to approach those lows again," said Sohn. "It's a new test, and the pressure is on." Ark Innovation has been a poster child for the riskiest trades. "My expectation is that they all do break," said Krinksy. "If you look at the Ark chart, it's the fifth time we've tested $35, $36. Typically there's not anything such as a triple bottom, let alone a quintuple bottom. The more times you test a level, the more likely it is you break." Sohn points out that the Nasdaq fell to a two-year low Monday. He said it is the first time the index carved out a new low over a rolling 2-year period since 2008. Like the Nasdaq, trading in Ark, Tesla and bitcoin is tied to the direction of interest rates. "I think they are three keys for long duration," Sohn said. "You could make the case that they're somewhat of a clue on interest rates. If interest rates come in, they would at least try to bottom and improve. That could be somewhat of a tell that maybe rates are starting to pause." Sohn noted that the i Shares 20+ Year Treasury Bond ETF , which serves as a bond market proxy, hit a new 11-year low Monday. The closely-watched benchmark 10-year Treasury yield touched 4% in overnight trading, and stood at 3.94% late Tuesday afternoon. Sohn noted that $206 was the May low in Tesla, and if it stays below that, it could drop to the low $100s. "If Ark undercuts $35, you're looking at $30. That's back to the Covid low," he said. Bank of America's chief equity technical strategist Stephen Suttmeier has also been watching Tesla closely. He says it is on "head and shoulders top breakdown watch." That chart formation signals more negative action that could take the stock to $100. "A decisive break below 216-206 would confirm the head and shoulders top and suggest deeper downside risk to chart supports at 180 and 167 along with the rising 200-week [moving average] near 156 and the log scale pattern count in the 100 area," Suttmeier wrote. --CNBC's Michael Bloom contributed to this story
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The charts of Tesla, Ark and bitcoin are all flashing the same big warning for investors - CNBC
How Bitcoin And Art Will Free The People – Bitcoin Magazine
And those who were seen dancing were thought to be insane by those who could not hear the music, Friedrich Nietzsche
Bitcoin and art could lead us out of the mechanical stronghold that the predatory, manipulative and exploitative fiat reality imposes on us. Art is individually liberating and inherently disruptive. Bitcoin is the groundbreaking technology that does the same. How do we free a people whose monetary foundation is not free?
To free the people, is a powerful statement. We can guess with great certainty from what or whom people want to be free. What happens when people are free? If we agree that Bitcoin and art need to free people from the fiat systemic oppression structures, we must be specific about what kind of freedom we want to lead. The power of art to free the people was always a threat to any political, military and economic system. As much as that power was suppressed by kings, governments and bureaucrats, that power was also manipulated in leading many revolutions just think of Europe in the 1960s, the 1980s and 1990s.
You think you are an individual, but are you actually? Jiddu Krishnamurti
In art, I becomes we. It is a paradox that is present in art. An artist is communicating the work with the public and in doing so becomes a part of the larger group. In that instant the artist becomes we, and we are one with the artist. Something similar is present in the existence of Bitcoin. With every block created and node approval granted, a singular becomes plural-forever embedded in the blockchain. I in Bitcoin, even if it is seen as a sovereign individualistic and pragmatic construct, disappeared from the vocabulary. In Bitcoin, it is always we as we are not singular but a combination of more than just one node/individual. That is how we discover that we is the path to free the people.
Consider your origins: You were not made to live as brutes, but to follow virtue and knowledge. Dante Alighieri
The fiat system and culture are predatory and mechanical. If we chose a contemplative and creative culture, the massive civil awakening that is potentially upon us could be transformed into the movement of creation and renaissance of human consciousness. The base for it is sound money is bitcoin, and the way of enlightening people is art. That is freedom. To be enlightened and to have sound money. That is how Bitcoin and art will free the people. Why do we always and repeatedly need to build technology and money for the worst-case scenario? We already have new, different technology and means of communicating and adopting the same. We have Bitcoin and art. Unfortunately, we perceive history as a past narrative, but we do not understand that history itself is a narrative in perpetual motion. And we learn nothing. All is already written in cycles and the nature of progress. To fully transform our reality we need to free the people.
Only after disaster can we be resurrected. Its only after youve lost everything that youre free to do anything. Nothing is static, everything is evolving, everything is falling apart, Chuch Palahniuk, Fight Club
Art will give us the vocabulary to articulate the science of Bitcoin. Through art, we could access the morality of Bitcoin. The people will be free through allegory and symbols. Someone could rightly state that allegory itself is nothing else but verbal symbolism. Bitcoin is the symbol of an idea and that idea is freedom. Bitcoin gives a new identity to freedom that is born out of contemplation and creativity. The idea of freedom is larger than the response to predatory and mechanical structures of the fiat system and fiat institutions. Bitcoin can free people to create a new reality using the language of art.
Bitcoin needs its own symbolism. That symbolism is the future essence of Bitcoin's existence.
If we are to withdraw that symbolism from Bitcoin, we will leave behind a lifeless mass of code and cold mathematical calculations. Bitcoin proposes a new definition of not just monetary freedom, but a definition of freedom in and of itself. The proposition is simple: Bitcoin is not issued and not controlled by any government or financial institution. By being not controlled by anyone at all, Bitcoin is closer to the idea of energy. And energy is freedom.
As a non-controllable entity, Bitcoin proposes a way for us to deal peacefully with each other through mutual agreement. That is freedom. This kind of exchange could only happen between and among free people. The only true connection even spiritual connection is between Bitcoin and art.
Freedom in the new Renaissance actually exists everywhere all at once on each node. Bitcoin and art inspire us equally to say: I dont know, and that is the only way to be free. In learning, we open freedom to be and to create. Bitcoin holds the idea that all people have the same opportunities to grow. That is freedom and that freedom cannot be achieved without your work and your compassion. That freedom is the key to the new Renaissance.
The artistic realm is real. It comes at first, down to us, in its immateriality. To grasp art we need to have consciousness and free will. Consciousness and free will are not illusions.
Art is not an illusion.
Bitcoin is not an illusion.
Freedom is not an illusion.
This is a guest post by Stefan Dzeparoski. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.
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How Bitcoin And Art Will Free The People - Bitcoin Magazine
Bitcoiners Must Fight The FATF And Its AML Regime – Bitcoin Magazine
This is an opinion editorial by Stephan Livera, host of the Stephan Livera Podcast and managing director of Swan Bitcoin International.
Financial surveillance is all around us. Every time you want to sign up with a bank, you have to show identifying documentation, be screened by their automated systems and get peppered with all kinds of questions about your job, your lifestyle and source of wealth. Oftentimes, when you go to withdraw, spend or transfer what you thought was your own money, you are subject to even more questions.
It only seems to be getting worse and worse as time goes by. Why are we here? It has to do with various organizations that push this nonsense forward. And one of the key organizations here is FATF, the Financial Action Task Force. FATF is a natural enemy of those who favor financial freedom.
There is a regulatory burden brought by FATF and financial crime regulations such as anti-money laundering (AML) requirements and sanctions. These regulations are introduced and driven on the basis that they help stop money laundering or terrorist financing around the world. But serious analysis of their effectiveness seems to show that they are resulting in less than 1% of illicit financing being detected (see my chat with Ron Pol and his research here). And yet, the world is paying a huge cost in compliance and lost civil freedoms. And, from a property rights standpoint, businesses and banks should be able to run their businesses how they see fit, rather than constantly being in a position where they must ask permission from regulators or licensing agencies to continue operating.
If theres a crime being committed, let law enforcement go and get a warrant! Regulators shouldnt just get to automatically violate the privacy of everyday citizens financial details.
Well its not clear exactly what kind of entity FATF is. It claims to be an independent inter-governmental body, but what is its registered entity? That appears to be a project operated out of the Organisation For Economic Cooperation And Development (OECD). Its ironic in some ways that FATF pushes massive regulation and scrutiny onto everyday normal people but it seems to not be very accountable itself.
But the short version is: it bills itself as a global money-laundering and terrorist-financing watchdog. The FATF Secretariat is funded by OECD nations to the tune of about 619 BTC (or in fiat terms: about $11 million) per year and it has about 65 staff members, per its 2021 Annual Report. But the impact it has is great, because it is the one pushing out FATF recommendations and threatening countries with being placed on FATF gray or black lists.
Now its not just FATF. There are all kinds of AML and financial crimes working groups, regulators and other entities out in individual nations around the world. So, they seem to all collaborate on how our financial lives must all be regulated and micromanaged. The gist seems to be that they come back with FATF recommendations about how to stop money laundering, and local countries and regulators have to implement these rules. Few people in any individual country or state care enough to kick up a stink and stop the financial regulation overreach and human rights crime.
Usually there are at least a few politicians in each country or political body who want to pretend to be anti-financial-crimes, which might also explain some of the recent unhosted wallets garbage coming out of the EU (see my chat with Gigi on why this corruption of language is harmful to bitcoin and to all of us.)
So, the end result is that more and more financial control flows into individual banks, businesses and entities who are forced to comply, or else. The regulatory and bureaucratic state deputizes businesses and individuals to perform unpaid labor. And anyone who disagrees gets accused of being a shill for criminals and money launderers. Do they not appreciate that there might be people who want to defend private property and freedom on principle?
Cue the classic comic.
This is why we are all subject to so much financial surveillance and intrusive questioning about ourselves. In some ways, that poor bank teller or low-level bank staff member is not wholly to blame! The real culprit is at a much higher level, its these intergovernmental-funded entities who continually spin narratives about how effective their regulations are.
Now, of course, Bitcoin is a big part of the answer to obsolete these wanton human rights violators. But even here, there are various Bitcoin companies and exchanges who are experiencing issues getting access to fiat accounts to enable the on-ramps that they provide for users.
Catch them for the actual crimes they do, whether thats theft or murder, etc. We also have to accept that freedom has a cost. Criminals also use roads, are we gonna have know-your-customer (KYC) requirements every time anyone uses a road? And criminals could also install curtains in their homes. Can you imagine the insanity if we came up with a Curtain Regulatory Authority that mandated that before any curtain installer could come install curtains, they have to conduct identity checks to confirm that youre not a criminal hiding behind curtains?
And remember, its not like the current justice regime is doing some fantastic job given all of the financial surveillance in the world today. The vast majority of the crime is still being done with fiat currency. The answer is not more control and bureaucracy, its to accept that the current approach is simply not effective.
This normalization of private data collection goes beyond merely AML and financial crime laws though. Were seeing real impacts, with quite recent examples:
So, in the end, creating this culture of private data collection has resulted in more innocent people being put at risk. Where does this factor into the calculation of overeager bureaucrats and politicians who play-act like their surveillance laws are helping?
PayPal recently came under fire for its change in policy relating to misinformation and docking customers $2,500. This time, it had to walk it back, given the social media outrage. But clearly, this is just a temporary reprieve from further financial surveillance on us all.
As Samson Mow of JAN3 tweeted, we can either use Bitcoin, or be forced to research all political ideologies of executives at major fintech companies. Your self-sovereign bitcoin wallet will not check your political views before broadcasting your bitcoin transaction. Your self-sovereign bitcoin wallet will not ask you about your source of wealth before permitting you to deposit funds and make use of it.
FATF and the AML regime have created and grown a culture where statists believe it is acceptable to peer into other peoples finances and control them, so long as their ideology differs from the people in power at the time.
Its a question of human rights. To the extent that its FATF recommendations encourage local regulators, bureaucrats and politicians to continue controlling private citizens and business money, it is impinging on their private property rights. FATF and the associated AML regime is violating human rights around the world, and were all poorer for it.
Bitcoiners must be clear about what the problem is, and start speaking up and taking action on it. That action can take the form of coding and building self-sovereign FOSS alternatives to the financial panopticon, and it can also take the form of suing government entities over-regulating and encroaching on innocent peoples lives. It could even take the form of lobbying local politicians to push back on FATF and financial surveillance. Defunding FATF would also be a great idea. Why must taxpayers around the world pay for this ineffective and economically destructive regulation?
As a final take away though, consider that while there are more obvious cases of financial exclusion (which FATF brushes away as unintended consequences), the case must be made on the principle of the matter. We want to live in a free market society with private property rights, and not be constantly wondering what we are allowed to do with our own money. The world does not need more FATF recommendations and reports. It needs defense of private property rights in principle.
This is a guest post by Stephan Livera. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
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Bitcoiners Must Fight The FATF And Its AML Regime - Bitcoin Magazine
Bitcoin Miners Are The Dung Beetles Of The Energy Sector – Bitcoin Magazine
This is an opinion editorial by Robert Warren, partner at Distributed Hash and business development at Upstream Data Inc.
The layperson knows only one thing about Bitcoin mining it uses a lot of energy, and that is bad.
This mind-virus, successfully spread by the climate extremists and anti-Bitcoin street corner preachers (typically carrying a proof-of-stake torch) is intended to be the death knell of our burgeoning industry. We use a lot of energy, and using energy is obviously a terrible thing. It follows that we should be scorned, pursued and regulated out of existence.
We are in a climate crisis, so as we all know, the best course of action is to install solar on your roof, buy a Tesla, shut down the coal and gas plants in your region, and argue anything short of that is systematically racist. Proof-of-work is the enemy.
This argument is, to most reasonable people who enjoy running their dishwasher and having the lights on at night, patently ridiculous.
But there is still that one big issue: Doesnt Bitcoin mining still use a lot of energy? And dont those computers clog our landfills the second they become unprofitable?
If you find yourself under the interrogation of the Bitcoin curious, having to answer for all of those megawatts were consuming, there is one question you must ask in response to, Doesnt Bitcoin use a lot of energy?
Yes, but which energy?
Source: Author
NOTE: Before we go any further, lets draw a clear distinction between energy and electricity. Energy comes from primary sources like a natural gas well, or hydroelectric dam. These primary sources are used to generate electricity, the secondary energy we make all over the world, sent through high voltage wires and used to power our dishwashers. If you want a resource to explore further, look HERE.
NOTE TO THE NOTE: Today not all bitcoin miners are using waste or excess energy. My assertion is that this is the direction our industry trends over the long run, regardless of generation type, because simple supply and demand drives miners to the lowest priced energy.
As long as waste energy exists, Bitcoin mining exists and is profitable.
Let me say again that for those of you in the back rows. As long as there is waste in energy production and supply chains, it will always be profitable to mine bitcoin, regardless of hardware type, manufacturer, age, location, anything.
Even esteemed Bitcoin Mining FUD masters like Alex de Vries of Digiconomist fail the simplest of economic analyses in the bitcoin mining space. That is, not understanding supply and demand. Which is why they publish findings like, A similar dynamic ultimately determines the fate of ASIC-based mining devices as advances in ASIC chip efficiency result in more powerful devices that eventually crowd out older, less efficient technology Because the technical lifetime of ASIC mining devices typically exceeds the period of time during which the device can perform its task profitably (McCook, 2018), the moment they become unprofitable determines their lifespan and the point at which they become electronic waste We show in this study that the lifespan of Bitcoin mining devices remains limited to just 1.29 years.
So, we are to understand, that efficiency in the ASIC market is the single driver of energy consumption and e-waste produced?
Ill invoke Brandolinis Law ("The amount of energy needed to refute bullsh*t is an order of magnitude bigger than that needed to produce it.") as my rationale for not addressing the above directly, and will instead discuss energy waste.
By waste energy I mean the various points across energy supply chains where energy is available to perform work, but for one reason or another does not. This takes various forms across the market, whether its methane venting and flaring on oil and gas sites, wind farms, hydroelectric plants, nuclear reactors, and solar farms powering down due to low demand.
Bitcoin mining is the ultimate waste reduction tool, because as long as waste exists in the energy sector, and it always will, there will always be an incentive to mine Bitcoin with that energy, regardless of ASIC type. (NOTE: If you are Alex de Vries, I need you to re-read that last sentence and reconsider your 1.29 year estimate for ASIC lifespan.)
Source: Author
Source: Author
The energy that is worth the least, is the energy that never makes it to market. The methane vented or flared on an oil well, the wind turbine that sits idle in a megafarm, the hydroelectric turbine that doesnt spin. In the case of solar, you have production times that mismatch demand times, so excess capacity goes unused midday. I.e., People turn lights on more when the sun goes down.
Bitcoin miners have no interest in your Science-Backed Turbo Grid, your political idealizations, or which dream team you assembled to form a research council. Whether you want 89% nuclear, 71% solar with Tesla Powerwalls, elimination of fossil fuels completely or 93.7% hydro-power, is irrelevant, we dont care.
We are the eternal free market free agents.
We want your waste and excess.
We are the dung beetles of the energy sector.
And already the framework of this robust industry is developing.
Rack, power distribution unit and transformer expertise for indoor operations, a variety of containerized solutions designed to protect miners in rugged Texas Summers and frigid Alberta Winters, half engine half datacenter chimeras birthed for the sole purpose of consuming natural gas, home mining black boxes that dump excess heat into your house during the cold season all exist. A secondary market in software and hardware emerges in firmware, machine management, maintenance and lifetime extension.
Everything is designed around a single goal, the identification and utilization of the lowest priced energy in the most efficient way possible. That lowest priced energy is not the electricity youre using to charge your iPhone, or watch Netflix it lives far off and away in a substation with excess capacity, or a natural gas plant with underutilized turbines. In this way Bitcoin mining brings a market to everywhere there isnt one in the energy supply chain.
At nearly every point in the energy supply chain there is some waste or excess that is better priced and consumed than left idle.
So when your Bitcoin curious friends next corner you to ask about those terrible megawatts that the bitcoin miners are using, your first reply might most productively be:
Which energy do those Bitcoin miners use?
This is a guest post by Rob Warren. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
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Bitcoin Miners Are The Dung Beetles Of The Energy Sector - Bitcoin Magazine
Bitcoin Now Costs $12,500 at This Trust, And You Can Even Buy It – U.Today
Arman Shirinyan
Exposure to Bitcoin can be far cheaper when using this fund, but there are some downsides
The Grayscale Bitcoin Fund was one of the main ways to receiveexposure to the cryptocurrency market for the majority of institutional investors back in the 2017 bullrun era. However, with the appearance of Bitcoin futures ETPs, the attention of investors shifted and the discount of the fund started rising to unprecedented values.
According to data shared by Arcane Analytics, it is farcheaper to getexposure to BTC via Grayscale compared to the spot. The discount against the NAV of the GBTC fund reached the record of 36%, making it farmore profitable to buyBitcoin via the fund rather than using the spot asset.
The current discount onGBTC and the lack of inflows into it paint a clear picture: institutional investors do not feel like it is a good time for investing in Bitcoin and the cryptocurrency market in general.
A high discount against NAV might turn out to be a good opportunity for investors when Bitcoin enters the uptrend once againsince the discount tends to turn premium when the demand for suchexposure is on the rise.
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Unfortunately, some investors prefer avoiding GBTC, considering some downsides like the minimum investment value of $50,000, which does not apply to secondary markets, a lock period and a noteworthy management fee.
Generally, institutional inflows to the cryptocurrency market are going through tough times, considering the almost nonexistent volume on Bitcoin and Ethereum ETPs and funds in both the U.S. and Canada.
The crisis on the institutional side of the market will most likely continue until the U.S. pushes a strict monetary policy to battle inflation.
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Bitcoin Now Costs $12,500 at This Trust, And You Can Even Buy It - U.Today
Progress Toward Bitcoin’s Halving Is 60% Complete, Block Times Suggest Reduction Could Happen Next Year Mining Bitcoin News – Bitcoin News
According to countdown statistics based on the average block generation time of around ten minutes, progress toward the next Bitcoin block reward halving has surpassed 60%. However, while most halving countdown clocks leverage the ten-minute average, the countdown leveraging the most current block intervals of around 7:65 minutes shows the halving could occur in 2023.
Just recently, at block height 757,214, mined on October 5, 2022, Bitcoins total hashrate tapped an all-time high (ATH) at 321.15 exahash per second (EH/s). Lately, block intervals have been faster than usual and well under the ten-minute average.
The speed at which the 2,016 blocks are found in between difficulty adjustments determines the difficulty and current block intervals suggest a large difficulty jump is in the cards. Now, prior to the next difficulty rise, the hashrate has continued to remain strong and block times at the time of writing are around 7:65 minutes.
The next mining difficulty retarget is scheduled to happen on or around October 10, 2022. If block times remain faster than usual even after the retarget, the protocols block reward halving could very well happen in 2023. Statistics from bitcoinsensus.com indicate that at 7:65 minutes per block interval, the halving could take place on or around December 19, 2023.
Bitcoinsensus.com further shows the halving time based on the average ten-minute rule which shows the halving will occur on May 1, 2024. Most countdown calculators apply the average ten-minute rule, and other data points suggest the halving could occur on April 20, 2024.
Either way, the progress toward the next halving is still more than 60% complete, and when it occurs, bitcoin miner rewards will be reduced from 6.25 BTC to 3.125 BTC post halving. Despite the high speed now, miners could easily slow down after the meaningful difficulty increase on October 10 is recorded and if BTC prices remain low.
This, in turn, would push the halving date back to the 2024 range and after all, theres still well over a years worth of BTC block subsidies to mine. A lot can change. According to a recent blog post from Blocksbridge Consulting, the difficulty change and low price range could give bitcoin miners a headache from loss of profits.
Bitcoins daily mining revenue per PH/s is currently around $80. If the difficulty rises 13% on Monday and bitcoins price stays at $19.5K, the daily revenue would decrease to $70 per (petahash) PH/s, Blocksbridge Consultings Miner Weekly issue #17 notes. That would cause mining companies to mine at all-time low revenues on a daily basis, even lower than what we saw during the summer following the May 2020 halving.
The blog post adds:
Unless bitcoins price breaks the $20,000 barrier, those who employ older-generation machines or have bloated mining operations will face an even tougher time ahead.
Viabtcs Viawallet halving metrics show that eight blockchains are expected to see reward halvings or whats known as reward reductions. Dash expects a reward reduction on June 20, 2023, as rewards will shrink from 2.76 DASH to 2.56 DASH. Other reduction events and reward halvings will stem from blockchains that include BCH, BSV, LTC, ETC, ZEC, and ZEN.
What do you think about the Bitcoin networks progress toward the next halving exceeding 60%? Let us know what you think about this subject in the comments section below.
Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.
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Bitcoins Philosophy And Political Promise Of Borderlessness And Solving Inefficiencies – Forbes
Bitcoin BTC is not just a decentralized peer-to-peer electronic cash system. Theres more. It is a new way of thinking about economics, philosophy, politics, human rights, and society.
Hungarian sculptors and creators Reka Gergely (L) and Tamas Gilly (R) pose next to the statue of ... [+] Satoshi Nakamoto, the mysterious inventor of the virtual currency bitcoin, after its unveiling at the Graphisoft Park in Budapest, on September 16, 2021. - Hungarian bitcoin enthusiasts unveiled a statue on September 16 in Budapest that they say is the first in the world to honour Satoshi Nakamoto, the mysterious inventor of the virtual currency. The bronze life-size sculpture depicts a hooded figure with stylised facial features, alluding to Nakamoto, a pseudonym credited as bitcoin's founder, but whose identity remains unknown. (Photo by ATTILA KISBENEDEK / AFP) (Photo by ATTILA KISBENEDEK/AFP via Getty Images)
Most of the literature I have read about Bitcoin majorly focuses on Bitcoin as a store of value, a medium of exchange, an investment vehicle, a shield against government overreach, and more. However, there is less literature about the philosophy of Bitcoin and the politics it represents.
Modern political systems have made it harder for individuals to focus on what they do. Besides working hard to create value and store that value for future use, the global citizen has to work twice as hard thinking about money and how it can be tweaked to preserve value and or grow value.
This is mainly because the political systems are anchored around the control of fiat money and cannot control the temptation to increase supply while the citizens bear the burden of increased inflation and cyclical recessions.
The average global citizen does not have complete freedom to do what they do best because they must divert their attention to the subject of money. They understand that inflation erodes their purchasing power over time and that they must devote a significant portion of their income to hiring money managers to invest their money.
Alternatively, they actively invest their money in the markets, which is tedious and time-consuming. A larger proportion delegate the function by staking their money in financial institutions and financial instruments that rarely beat inflation.
What if there was an efficient store of value? Would this make the global citizen free to focus on value creation in whatever they do best?
In my opinion, Bitcoin's philosophy is based on freedom and borderlessness. If it eventually acts as a stable store of value, which it has achieved over a 4-year time horizon and failed under that time horizon, the global citizen will have more freedom to focus on what they do best without handing over control to a third party or spending significant time managing their store of value.
Bitcoin is borderless. It cruises through multiple jurisdictions and perhaps planets, well, if Elon Musk's mission succeeds. It presents a strong case for solving global inefficiencies associated with different states using different fiat currencies of varying quality.
For instance, the emigration problem, where people living in countries where there is bad money move to countries with perceived better money, can be evened out with Bitcoin adoption. For people working in the digital space, cryptocurrency payments (not just Bitcoin) have begun to solve the income inequality problem. Developers, content creators, artists, and other online workers have begun to close the pay gap regardless of where they are located.
In Bitcoins philosophy, an individuals country of birth or residence should not dictate their economic outcome. When they work hard to create value, they should be able to store and build value on a relatively fair playground. A truck driver in a country like Nigeria should have a similar level of financial outcome to a truck driver in, say, the UK. The value created should be borderless.
The inefficiencies resulting from the different quality of fiat curencies and government systems should be solved with wider Bitcoin adoption. For instance, an investor looking to invest in a coffee shop in a busy city like New York or Nairobi should find it easier to allocate capital to either without worrying about the influence of the fiat currency used in the two jurisdictions or the governance systems that apply. Bitcoin makes it possible to invest borderlessly without the headwinds associated with traditional financial institutions and systems.
In Zimbabwe, annual inflation was over 250% in July, and the central bank raised interest rates to 200% to combat the high inflation. What type of business can thrive in such an environment? I am confident that there are great businesses in Zimbabwe that solve critical societal problems, and they deserve to be able to access finance at competitive rates. As a result, they would price their products more competitively, resulting in lower inflation.
The lack of political influence on Bitcoins supply makes it the hardest asset on earth. This means that, as adoption grows, the value goes higher since supply is capped. This eliminates the possibility that political elites could print more like they do with fiat currencies leading to hyperinflation and later recessions. It also makes Bitcoin a trusted store of value and medum of exchange. Where am I going with this?
With wider institutional adoption, the political promise of Bitcoin is solving inefficiencies. For instance, according to the United Nations, the world produces sufficient food to feed all humanity. However, the wastage and inefficiencies in storage and distribution leave an estimated 800 million people hungry or malnourished.
For instance, with Bitcoins borderlessness, investments can be made in regions where there is excess food production at lower costs to improve standards, storage, and distribution channels. This would reduce food wastage and lower food costs across the world. However, the current financial systems make it harder due to taxation, currency devaluation, and poor access to financing.
This promise of borderlessness is already being experienced in energy production and distribution. Bitcoin miners are investing in regions that have excess power production at low costs and redistributing this value in other areas. In addition, some miners are acting as grid stabilizers where they consume excess energy when demand is low and switch off when demand is high thereby helping power producers earn value during both high-demand and low-demand grid cycles.
At a macro level, the capitalist Keynesian system that led to central banks printing trilions of cash during the pandemic led to the current high inflation environment that we are experiencing today. Though it helped people survive, to a degree, during the pandemic, the spillover effects have led to the poor people becoming poorer and the rich getting richer.
The Bitcoin plebs that understand the philosophy of Bitcoin have been accumulating Satoshis at lower valuations since they understand the fundamentals. They are able to store value in peace while focusing on doing what they do best. They are not worried that the FED is going to reverse course and print more dollars thereby devaluing their stored value. They have become sovereign individuals.
In my article about how Bitcoin is helping people become sovereign individuals, I explained the issue of borderlessness when it comes to spending your value, storing, and achieving a level playing ground for everyone.
Disclosure: I own bitcoin and other cryptocurrencies.
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Bitcoins Philosophy And Political Promise Of Borderlessness And Solving Inefficiencies - Forbes
Ex-Ripple Top Developer Tells Sad Truth About Bitcoin, Here’s What It Is – U.Today
Gamza Khanzadaev
Ex-Ripple top developer shares controversial opinion on Bitcoin
In explaining the difference between Bitcoin and other cryptocurrencies, Matt Hamilton, former director of development at Ripple, approached the answer from a nonstandard angle.
Thus, the developer stated that the main difference is that Bitcoin revolutionized and proved the concept of artificial digital scarcity, but now other cryptocurrencies rule the ball. All new developments, innovations and business models are now being built and shaped not based on Bitcoin, said Hamilton.
This is not to say that Bitcoin technology is not being addressed. For example, Lightning Labs, the company behind the Lightning Network infrastructure, recently released a test version of Taro, a new software that will allow BTC developers to create, send and receive assets on the Bitcoin blockchain.
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Michael Saylor, being a well-known Bitcoin maximalist, is also not staying away and, as has recently become known, is looking for a software engineer for MicroStrategy to build a SaaS platform based on the Lightning Network.
Bitcoin's share of the total crypto market capitalization remains quite high. At $916 billion, Bitcoin accounts for $381.4 billion. Bitcoin's dominance has also reached a comfortable level, at 41.75%, having been here since it hit its 2018 lows in early September.
In summary, it is hard to say whether Bitcoin's time has passed, but for now it remains the main cryptocurrency on the market and even seems to have a chance to continue its technological development.
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Ex-Ripple Top Developer Tells Sad Truth About Bitcoin, Here's What It Is - U.Today