13 Reasons Bitcoin Bulls Are Wrong

“Simplicity is about subtracting the obvious and adding the meaningful.”

John Maeda, The Laws of Simplicity: Design, Technology, Business, Life

The chances are, you fall into one of three tribes when it comes to crypto.

The first is that you are pro crypto, and bullish.

The second is that you believe crypto is a bubble or “scam” etc. and are bearish.

The third is that you still don’t know what crypto is and how it works, which means you’re likely more inclined to join the bears than you are the bulls.

If you’re a bear, you’re going to have a hard time arguing that crypto is in a bubble, because the first thing I’d ask is “compared to what?”.

When compared to what we usually measure bubbles in, like any major index like the S&P 500 or the bond market, that argument won’t really fly. There are well-established conventions for valuing a stock or index… how do you value a rare “escape valve” for capital outside of the monetary system that allows capital to be privately transferred almost instantly?

Further, the “stimulus” in the last year alone has risen asset prices to extreme levels across the board. Bitcoin may have been a recipient; but so has a lot of things.

So unless you want to compare the price of Bitcoin to the price of something that hasn’t seen wild capital flows like… I don’t know… bananas, you can’t really argue that it’s in a bubble, even at the all time high prices we are currently seeing.

And arguing it is a scam is fine, if you could point out how it’s a scam.

But you can’t, no one has, and it seems increasingly obvious that proponents of this argument are either politicians, or clueless (and obviously, there’s a massive overlap there), and conflate Bitcoin with all sorts of shitcoin.

To be fair, Carlos didn’t help.

Which leaves us with tribe #1, which most of our readers tend to be.

For full disclosure from the outset – we hold Bitcoin and Ether positions, and have been recommending these since even before the start of Insider and our fund.

When we first officially recommended Bitcoin to clients (@ $450), we were mostly met with raised eyebrows, and a lot of questions.

Since then we’ve written many reports on it, frequently covered it in our newsletter, taken many questions from our Insider members at our monthly Q&As, sought guidance from experts, held many long conversations with incredibly bright investors on it, and generally kept abreast of all the goings on seeing it is still one the themes in our portfolio.

That is to say, we have a deep enough understanding of what it is, the market for it, and its potential future role in the world.

But although we still recommend buying Bitcoin, it won’t be for much longer. This separates us from most out there who hold Bitcoin, and think the wide scale adoption of it is inevitable.

Over the years, much has happened to solidify crypto as a mainstay.

We had the ICO meltdown a few years ago, which flushed out a lot of “investors” and created a great buying opportunity.

We’ve had the WallStBets story that exposed the state of the financial system’s “health”, pushing more people into crypto.

We’ve had the recent run, which our governments’ increasingly preposterous interventions have no doubt contributed to.

And we may soon have Turkey introducing capital controls, which would give Bitcoin a whole new fuel tank.

In 2013, when Cyprus led the way in the “bail in” movement, bitcoin’s price surged, but so too did adoption. As Bloomberg wrote:

“Since Sunday, a trio of Bitcoin apps have soared up Spain’s download charts, coinciding with news that cash-strapped Cyprus was planning to raid domestic savings accounts to pay off a $13 billion bailout tab. Fearing contagion on the other end of the Mediterranean, some Spaniards are apparently looking for cover in an experimental digital currency.

“This is an entirely predictable and rational outcome for what’s happening in Cyprus,” says Nick Colas, chief market strategist at ConvergEx Group. “If you want to get a good sense of the stress European savers are feeling, just watch Bitcoin prices.”

The value of the virtual currency has soared nearly 15 percent in the last two days, according to the most-recent pricing data. “One hundred percent of that is due to Cyprus,” says Colas. “It means the Europeans are getting involved.”

That Spaniards would consider converting a portion of their dwindling savings into a peer-to-peer currency vulnerable to wild price fluctuations and the odd thieving Trojan speaks volumes about banking confidence in some parts of Europe. As German economist Peter Bofinger warned in an interview with Spiegel Online: “European citizens must now fear for their money.”

Now imagine the effects of a population roughly 80 times larger going down this road…

We’ve also seen the adoption of blockchain technology into real world applications and the signalling from banks and corporations that it is actually a legitimate and worthwhile technology to pursue, during all this time, and China’s march toward releasing the first Central Bank Digital Currency (CBDC).

Today, we also have a never ending lineup of “experts” and “gurus” shilling crypto, along with a gamut of newsletters and services designed to profit from a trend.

This concentration of excitement and optimism around crypto has set up echo chambers, where on one hand, you have the mainstream financial media and the forces it represents, and on the other, you have the alt financial media that has its own incentives and biases.

What we increasingly do not have and desperately need, is functioning journalism, independent, critical thinking, and discussion from more than one side of a story.

This is crucial for proponents of Bitcoin as it is proponents of a free and prosperous society.

Over the last years and decades now, the mainstream media has proven untrustworthy, biased, protected by large corporations or governments, and incapable of independence and intellectual rigor.

Check out this job advertisement for a Russia Correspondent from the New York Times as a brief example:

Though the ad has since been removed, here’s a Source

Whether any of the claims highlighted in this job post are valid or not is missing the point: what does any of the text underlined in red have to do with hiring someone?

This is a clear example of how real journalists are excluded from being hired by these news outlets – if you don’t agree with the claims made in the advert, and report accordingly, don’t even bother to apply.

Real journalism takes a back seat running a news outlet these days.

The masses have been waking up to this, and have grown so distrustful of the “fact checkers” and broad censorship that they’re flocked en masse to the “alt media”.

That’s good, right?

Not really, no, and I’ll tell you why.

Alt media journalists are not typically trained in the rigor of journalism.

In other words, what we have now is a whole army of content makers straying from the journalistic method while presenting their findings as fact.

This is generalising of course, but what you have is largely a bunch of people who became fed up with the status quo, took it upon themselves to do research, and became self appointed “journalists”.

Now, before you head to the comments section to tell me off for not supporting open source information that benefits everyone, please hear me out.

The problem is not with the people or their intentions, which are noble and essential to a free world. Being a true journalist these days takes enormous bravery and sacrifice – see Julian Assange, Ed Snowden, Glen Greenwald and others who are being hunted right now.

People that perform real journalism – where facts are verified and reported often to the chagrin of the status quo – deserve medals. They are key to a free society in which all ideas are exposed to criticism and debate, and therefore key to financial markets, as facts allow accurate price discovery to occur.

The problem is these people are too few and far between; they are the exception and not the rule.

The journalistic standard – the process of fact finding and verification – is not being upheld in alt media, just like it isn’t in the mainstream world. You either have the “blue pill” journalists being indoctrinated by university to glide into jobs where a predetermined narrative exists, or you have “red pill” journalists who recognise this and essentially rebel, taking the opposite side on any issue being covered.

This is true whether the issue falls under climate change, social justice, covid or the financial system.

While the status quo is guilty of propagating hot steaming piles of bovine manure about Bitcoin (it’s a scam, its uses are nefarious etc.), the alt financial media and its gurus are just as guilty of getting swept up in their own hype.

It goes something like this: crypto is the future, nothing can stop it and we’re all going to be rich.

I was told there'd be Lambos

It’s the same dynamic playing out with Wallstreetbets and its war against the financial establishment – hype that is aimed at changing the status quo and democratising the economy, because the government can’t… or won’t.

Both the establishment (hedge funds, brokerages, media, govt officials) AND the rebels (from teens using their stimmy cheques to gamble to long time anarchocapitalists) – what matters is beating the enemy, making money or both.

Little attention is given to the nuances.

And there are always nuances.

So with this as our backdrop, I was recently sent this article entitled “Every Reason Bitcoin Will Not Fail”, where the author provides an entire list of rebuttals to as many arguments against crypto as they can.

It was interesting to see an article take on many arguments against Bitcoin, instead of parroting arguments for Bitcoin.

But unfortunately, the same issue still troubles us with Bitcoin, that neither this article or anything we’ve seen properly addresses.

And that is:

Government.

The government is a force that likes competition in the same way that the Mafia do.

If you’re wondering what that means, it means they will ban Bitcoin at some point.

If you think the government cannot simply “ban” Bitcoin, you’re probably thinking about it the wrong way.

A government would have to ban the internet to ban Bitcoin (which by the way just happened in Myanmar, but anyway…).

This is one of the biggest arguments that proponents of Bitcoin and blockchain have – it’s impossible to do, given society relies on the internet, so governments cannot simply ban it, it won’t happen.

But let me ask you…

Would you buy bitcoin if you needed a (very expensive) banking license to?

How about if the government issued hefty fines for trading it?

What about 10 years in prison for buying it? Or worse?

Sounds whacky, doesn’t it?

Well, the state of Western Australia in good ol’ cruisy laid back Australia recently imposed $50,000 fines for you if you’re caught not wearing a goddamn mask.

If I’d told you that in December of 2019, you’d have called me a lunatic.

And yet, here we are.

Just like if I told you in 2019 that an entirely factual article I wrote on clean energy got everything we publish censored, because it triggered some faceless, incompetent, virtue signalling “fact checker” at Facebook, then you’d have said I was a paranoid lunatic.

And yet, that happened. Try sharing any of our content, chances are many won’t even have the guts to now, because of the atmosphere of censorship and the social pressures it creates makes it not worth it.

Most people are cowards.

It is the human response mechanism to danger and entirely understandable, even if not noble.

This is how governments can ban things, without banning them.

It’s almost maddening that people still cannot understand that what is going on politically in the West is the most important thing in determining your financial future, but I guess they’re going to have to find out the hard way.

Like this guy, writing about our Insider Weekly newsletter:

I guess disavowing genocide offends people too nowadays

To reiterate, we have zero political affiliation and have zero to gain by supporting one party over another. Our view is that while people probably get into politics for good reasons, those who achieve any level of power are mostly sociopaths who want to amass more power and control society rather than “serve” it.

Clients do not pay us to be supporters of these beloved “leaders”.

They pay us to understand reality, forecast outcomes, and position their capital accordingly.

That is our only interest.

If readers believe that we are in support of any political leader or movement, it’s probably their own insecurities being reflected in how they interpret our writings.

If we’re critical of “the left”, we must be “alt right”!

If we’re critical of “climate science”, we must be fossil fuel loving “climate deniers”!

If we’re critical of covid measures, we must be baby seal beating, heartless MAGA nazis who don’t care if people DIE!

Protests

And so on.

Our objective at the end of the day is to understand probabilities, and you cannot do that without understanding reality – not the reality you see on the news… actual reality… which is hard to do in a world where STEM is racist (read my report on it if you haven’t).

This is sometimes too uncomfortable to address for people who think investing involves dressing in a suit and looking at charts. I haven’t done the former for 20 years.

It’s equally difficult for those who hold their future hopes of financial freedom and the world being a better place on the success of Bitcoin.

As well as being a proxy for the generational war that’s going on between boomers and those younger who will own nothing and be happy according to the Davos crowd, Bitcoin promises what real estate did for the boomers… it gives normal people the opportunity to be wealthy by simply owning an asset that will appreciate substantially in price.

And this emotional dependence people have placed on Bitcoin and crypto in general being the answer to many of the world’s problems, is where their ability to understand reality falters and their judgement gets clouded.

How Bitcoin gets banned and on what timeline, I do not profess to know.

But I believe it does, and here is a brief summary of why:

Crypto and Bitcoin in particular provide a unique hedge against inflation, while providing an efficient means of transportation of value.

That’s a problem because it will send a significant signal to the technocrats who completely pha-cdup the monetary system, that there is competition to their own CBDC they wish to be dropping on us.

That is simply how the probabilities stack up.

We remain long… for now. But I’d encourage you to consider these thoughts, position size accordingly, and plan for Bitcoin to eventually be designated as a tool used by “terrorists” to threaten national security or some such nonsense.

From Forbes:

In 2018, Yellen also warned that “many” Bitcoin transactions are “illegal, illicit transactions”—an opinion echoed by a recent U.S. Department of Justice (DOJ) report that found the emergence of Bitcoin and similar cryptocurrencies is a growing threat to U.S. national security, with the attorney general William Barr’s Cyber-Digital Task Force calling it the “first raindrops of an oncoming storm.

If you think the short stumpy lady will reverse her view along with the rest of the establishment, I’d like to know why right here.

2
Why will Yellen allow bitcoin or any other crypto?x

But before you do, please read some of the common rebuttals to the “Bitcoin will get banned” claims, and my thoughts on each. The points in orange being the rebuttals from arguments first published here.

13 Arguments Bitcoin Bulls Are Wrong On

Which governments would ban Bitcoin? The risks will vary depending on whether you live in North Korea, China, or Switzerland. All countries have borders that can be crossed by people. Bitcoin crosses borders as easily as any information can.

All governments. The only reason the government functions is because of tax, which BTC provides shelter from. Which makes it a target. It doesn’t matter that it can be taken across borders, so can gold, the issue is there’s no easy way (yet) for govts to track it, control it, and tax it, and therefore it’s a threat to the system which revolves around regulating and controlling transactions.

Bitcoin is a global software network that cannot be stopped anymore than we could stop all ants from existing around the globe. Even governments are limited in their effective power.

In 2019 most people believed that it would be impossible for governments all around the world to imprison people in their own homes. But here we are. It will be stopped by people being scared to transact in it… these types of people many freedom advocates call “sheeple”. How rational the reasons are won’t matter. See Covid as evidence. Without transactions / volume / adoption, it’s utility / value diminishes. Humans are involved here. The system might be impossible to stop; people sure as hell aren’t.

Pensions, endowments, insurance companies and corporations own Bitcoin. Governments that have allowed these institutions to own Bitcoin will not be able to make it illegal without impoverishing their voter base. Companies that built on top of Bitcoin, including large financial institutions would be crippled.

Firstly, see the recent ESG mandates for pension funds and the likes. They’re all dropping fossil fuel companies and not “socially responsible” companies from their holdings, because they’re being forced to. These are plain vanilla stocks. If they have managed to do that to stocks, why on earth can’t the same thing happen to Bitcoin? Secondly, governments have been shutting down businesses and impoverishing their voter bases since the start of the virus. This would be no different to what is already happening.

Governments are constrained by their citizens and laws. Since politicians, corporations, and citizens already own Bitcoin, some in “the government” or capable of lobbying the government already have a vested interest in Bitcoin.

In theory governments might be constrained, in reality citizens are constrained. Find one government representative that has any hope of getting into power in any country that is pro Bitcoin and wants to make it legal tender. Show me the chart where most of the population own Bitcoin and are pressing their govt officials to keep it legal. You won’t be able to, because a fraction of the population owns Bitcoin, and no powerful politicians are in public support of it, regardless of whether they own it.

Countries compete with each other, they won’t all work together to stop Bitcoin. Governments want to attract investment and technology so they will create competitive laws to attract Bitcoin. Rival countries need neutral reserve assets like gold or Bitcoin since they cannot trust the currency of their rival.

Seems logical, but check out every major economy’s interest rates since 2008. They’ve all been the same in order to “save the system”, meaning there has been no escape valve. All that work, destroying their economies, and then they’ll magically say BTC is fine? This is why BTC has become so popular as an asset class, and simultaneously what makes it a target. Of course capital would flock to countries who were pro Bitcoin and decentralisation; and so would the rest of the world’s governments – to shut them down… because if they were successful, that’s the end of the system. It’s not in any one government’s interests for btc to succeed. Maybe to dethrone the US, but what then? The nature of government is force and control. Enjoying the spectacle of one’s enemies being destroyed (As China is currently doing with the West) is not the same as being pro freedom. All governments want control. So a mass adoption by competing countries is unlikely to happen.

Peer-to-peer exchanges cannot be stopped. Every country that has shutdown exchanges have seen the emergence of peer-to-peer exchanges that can leverage any existing payment networks.

While the tech cannot be shut down, the majority of people can be shut down. See.. oh I don’t know, all of world history as an example of governments forcing people to do things or not do things for a “greater good”.

Transactions are unstoppable and undetectable. Bitcoin transactions can be hidden in text messages, emjoi, images, and sent from anywhere on the internet.

They’re not unstoppable. You make it illegal to transact in BTC, or you tax it to the high heavens, and watch what will happen. The network will shrink, and become tiny and inefficient. There may be the hardcore users, but it’ll be like the Matrix, except without the happy ending.

Governments can never completely stop goods that most people want. Black markets form in cannabis and alcohol, and Bitcoin is far easier to move and harder to detect than those.

This uses the history of black markets as a standard for BTC. The difference now is that you’re trackable everywhere through all your online activity, even your bloody toaster listens in on you these days and feeds the info to big tech. So. If we’re all under surveillance and the consequences for transacting in BTC are severe, it won’t get to broad acceptance. In summary; it may be far easier to move, but it’s not in practicality harder to detect. For example, in order for you to avoid detection, you’re going to want to use VPNs or Tor or whatever. So say the govt bans them, because they are where terrorists are… The “far right extremists” are all using VPNs, so that threat needs to be eliminated. This is why issues like censorship that I often cover to the shagrin of many peers are so important, because censorship is used to stop things unrelated to speech, like BTC transactions. People don’t make the link between free speech and economic slavery, but it’s there I assure you. Same as shops who accept payments in btc. They’ll be ordered to hand over wallet IDs, and once the govt has that, it’s there for all the future and subject to all future tech and enquiry that can link transactions and when (not if) you get found. Point is, sure, it might be possible to remain undetected, but it’s going to be so hard that people will not bother and just won’t participate.

Governments with property rights laws are mostly treating Bitcoin like other assets. They are incentivized to tax it, not to make it flee across the border.

Bitcoin is not like other assets, which is why it’s actually NOT being treated like other assets. On the one hand, more than a decade after the technology is in play, there are still unclear and ever-changing regulations and classifications in the legal systems and tax codes of the world. On the other, it’s a new asset class that has “hockey sticked” in investment, which has been led by decentralised individuals, and not centralised corporations and investment funds etc. It threatens the SYSTEM, so some countries might go down the tax route, making the taxes a lot higher (and therefore disincentivising people from owning) or outright making it illegal. This is all still unfolding, but believing that individual property rights will be upheld at all costs is optimistic if not outright utopian at this point. Betting on BTC in this regard is like betting against the government. Maybe it happens this time, in which case it’s really the start of an entirely new form of civilisation (exciting), but history does have a habit of rhyming, and the size of the rebellion is nowhere near sufficiently large enough yet.

Bitcoin cannot be confiscated without permission. Bitcoin is pure information that can be stored in your head, spread between people, or moved instantly across the internet. It can be probably transferred out of your control prior to capture.

See Julian Assange or Edward Snowden for an example of what can happen when you procure and share information. Will you want to own Bitcoin if the ramifications of being caught with it are so draconian?

Real estate, stocks, and bonds are far easier and bigger honeypots to confiscate. There is nothing else to own more secure than Bitcoin.

Real estate, stocks and bonds are owned by a far higher percentage of the population, which would make it much more politically difficult to confiscate wealth (which won’t stop them stealing it anyway). We believe that’s likely to happen regardless, over time, but it’s far easier to steal from a smaller % of the general public who believe in privacy and decentralisation, who do not organise. Think about it, you can steal from them and still be in a “democracy” if you can convince everyone else… You know, “those poor saps who lost their jobs from covid, who don’t own Bitcoin, that it’s unfair because those that do are privileged with technology” or some such hogwash. In order to understand how a politician will confiscate your wealth for redistribution, put yourselves in their shoes, apply a bit of creative thinking, and your perspective will change.

The confiscation of Bitcoin will be rolled out slowly country by country allowing people to adapt. The confiscation of gold only occurred in the US. Gold prices went up in other countries where you could own it.

The entire world’s political and regulatory policies are now being pretty much dictated by intranational, globalist, Davos attending organisations like the EU, UN, IMF, World Bank, Central Banks, WEF, not to mention all the trade partnerships, working hand in hand with large corporations. This isn’t the 1950s. Globalization requires cooperation of the world’s countries, in order for it to work as one system. If countries depart from it, they get isolated and treated as threats to the system as a whole. Our view is we are set for many years of de-globalisation (here’s the whole story), but that doesn’t automatically mean we go back to how the world was before. Nor does it mean countries are going to peel off and become ultra laissez faire capitalist low tax havens that value freedom and personal liberty, without massive struggle/change. So, using historic examples of politics and regulation is erroneous. In terms of the gold confiscation argument… guess what? The vast majority of people handed their gold in. The same thing would happen again.

Central Bank Digital Currency (CBDC) issuance will forever legitimize crypto currencies and this will be a boon for Bitcoin.

This goes hand in hand with the belief that regulation is a good thing as it will legitimize Bitcoin, and that will bring more capital into the space. That would undoubtedly be true, if it were a world of price stability and free market capitalism that the elites have in mind. Absolutely nothing I’m seeing right now indicates that any of the people in positions of power today have the sort of ideology that is free market oriented.

Conclusion

We will at some point sell and instruct our clients to, and hope to do so at a massive gain and before the hammer comes crashing down.

Maybe we succeed, maybe we don’t. Time will tell.

I do think Bitcoin can easily run over $100k, or much more, and we remain long (with adequate risk management and position sizing of course)

…and this comes from a guy who bought my main slug of a position back in 2014 and weathered the volatility since without selling.

Ballsy? Maybe. Time will tell.

If Bitcoin gets to $100k (or something in that region), gold at anything below $5,000 would be a substantially better risk reward trade, in our humble opinion.

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KIrC
KIrC
1 month ago

Good article Chris, been in bitcoin since 2015 myself and see the same. The party has to end at some point.
What would you think of fully government integrated/compliant digital money like BitcoinSV?

KIrC
KIrC
1 month ago

Hi Chris, thanks for responding.
I am actually suprised that you haven’t heard of the ”Bitcoin civil war” and subsequent forks of Bitcoin (BCH and BSV) that happend 3 years ago, there was quite the uproar about the whole thing.
BSV is not a govt issued digital coin, its the result of the Bitcoin civil war and sanctioned by the creator of Bitcoin, Dr Craig Wright, because he felt that the current stewards of the BTC software (after 2010 when he left it), distorted the original concept of Bitcoin, as described in the white paper.
Dr Wright designed Bitcoin to act as digital cash for micropayments and not as the ”digital gold” that people consider it today. BSV has scaled today to a level that can compete with the transaction capacity that VISA has today (transactions per second) with the cost of sending money, being fractions of a cent.
This is intended to be as legal and integrated to the current financial system as the VISA network is today (with the ”killer” competitive advantage that it can enable microtransactions). The system (as originally designed) is fully traceable (for law, KYC and other reasons).
So, what I am saying is, there is not a reason to ban or abolish such a system right? It is not blight by all the issues that the other cryptocurrencies have…

Fabio Fava
1 month ago

Great analisys as usual… But… What if… System is just about to crash, and their master plan will ruin with them… And people will elevate and set themselves free… I know, its utopia… But is the only way against distopia. Many will die, we know, but seems that their master plan will just kill their own masses, leaving only the other ones (us), then majority will be awaken (not woke, God dammit!)… Lets create the world we want to live in…?

Mitch
Mitch
1 month ago

A country that bans an ever so fastly growing system that is borderless and unstoppable TO SEAMLESSLY LEAVE BORDERS better buy it as fast as they want to make their countryman sell it. It’s almost embarrassing to be subscribed to such an expensive newsletter that faked people out of Bitcoin and montsh later brags about talking about it since $450. Sounds to me you guys are jealous you didnt’ invent it yourself.

Mitch
Mitch
1 month ago

Hey Chris, I’m sorry I don’t mean to bring nonsense in here. I do believe most of what you provide is of great intelligence and value. I just cannot grasp how an investment in a digital digit that 98% of the world wants nothing to do with, and those who do are only in it to hopefully get more fiat, is the vehicle that somehow is a major threat to all governments around the world. Your argument has an outlook that cryptocurrencies and those that care about their freedom couldn’t simply exist amongst the fiat and slaves, of which the freedom and slavery part are a constant throughout history. Anyway I was trying to change a majority of my comment after posting to be more constructive (it wouldn’t let me) and ask if you could elaborate this threat to governments because the last decade has most certainly informed me of what decentralized currencies will never be, that is regularly used, unless the day came that the govt tells everybody to but I think that happening is an obvious never.

KIrC
KIrC
1 month ago
Reply to  Mitch

I have been following Chris for quite a few years and his recommendation has always been, ”buy bitcoin”… maybe you are confused with some other newsletter?

Mitch
Mitch
1 month ago

How are cryptocurrencies a threat to the system?

KIrC
KIrC
1 month ago
Reply to  Mitch

The only use case of 99% of crypto is to evade authorities while replacing gold with a digital format. What happened with Liberty Reserve will happen again. You can’t beat the gov, that will never happen as long as governments exist.

Liberty Reserve was a Costa Rica-based centralized digital currency service that billed itself as the “oldest, safest and most popular payment processor, serving millions all around a world”.[1] The site had over one million users when it was shut down by the United States government. Prosecutors argued that due to lax security, alleged criminal activity largely went undetected, which ultimately led to them seizing the service.[2]

In May 2013, Liberty Reserve was shut down by United States federal prosecutors under the Patriot Act after an investigation by authorities across 17 countries. The United States charged founder Arthur Budovsky and six others with money laundering and operating an unlicensed financial transaction company. Liberty Reserve is alleged to have been used to launder more than $6 billion in criminal proceeds during its history

Ken Poirot
Ken Poirot
1 month ago

I think bitcoin’s own shortcomings will be its undoing, namely, energy consumption (miners consuming more energy than entire countries like Argentina, which is counter to the globalists “climate change” agenda), it’s slow speed for transactions, and high transaction costs when compared to other crypto alternatives. In contrast, I believe Ripple’s XRP will be embraced by the globalists. Once Ripple’s XRP is deemed not a currency by the courts (Ripple is clearly winning its court case with the SEC and even the SEC’s circular arguments seem to favor the fact XRP is not currently a security), I believe world adoption of XRP as a bridge digital currency by central banks will be forthcoming. XRP uses a fraction of the energy that bitcoin uses (and less energy than even VISA or Mastercard transactions), takes seconds to complete a transaction, and the transactions are cheap. I agree with you that world governments will be dropping their CBDC’s on their citizens but they still need an efficient way to conduct business from foreign CBDC to foreign CBDC. This is where XRP comes in as the bridge currency to affect efficient (within seconds) transactions across the globe making the antiquated, expensive SWIFT system completely obsolete. Globalists are in bed with Ripple (XRP adoption) as can be evident by Ripple’s interactions/inclusion in meetings with the IMF, World Economic Forum, etc… XRP eliminates the need for nostro and vostro accounts (approximately $27 trillion placed in dead money) around the globe in order to inefficiently move money under the current SWIFT system. That $27 trillion can be reabsorbed by banking institutions and reallocated for investment/capital expansion versus sitting dormant as dead money, effectively putting that money back into world economies to spur much needed growth. Using XRP as a bridge currency is just one major use for XRP, it is also being used for cross-border payments/remittances and being tested in the FX market (see SBI in Japan who will also use XRP to pay shareholder dividends). I think you are right about bitcoin, but I think there are ultimate winners in the cryptocurrency market, like XRP. In the interest of fair disclosure I do not own any bitcoin, but I do own XRP because I believe XRP will be the ultimate winner in the cryptocurrency space (and there may be a few others). Ripple/XRP has the international connections and they have a head start on building the bridge currency/global payments and remittances infrastructure that the globalists want while also playing into the globalists “climate change” agenda.

Philip Lee
Philip Lee
1 month ago
Reply to  Ken Poirot

any crypto that’s not decentralized is worthless IMO. XRP is far from decentralized

Rippole
Rippole
1 month ago
Reply to  Philip Lee

Ripple is owned by the Freemasons, just look at the logo! So if course it’s not decentralised. Why would the global elite want to use a decentralised coin to transact with?

Philip Lee
Philip Lee
1 month ago

Thank you for the great writeup as usual. I consider myself very lucky to have found you. I joined your site about 4 months ago which is almost perfect timing since I haven’t had to hold through much pain with the commodities lol.

I believe everything you say is true about governments trying to ban crypto. Which is why I think society needs to collapse before we can really start over. There is a little known crypto that I was hoping that you might look at. It’s called Nexus. The creator’s name is Colin Cantrell. His father is Jim Cantrell, a founding member of SpaceX. It is rumored that Jim actually taught Elon about rockets.

Nexus is not just a crypto. It’s basically a system to replace the government and the internet. Nexus is creating a decentralized internet (Web 3.0) and it’s own operating system, among other things. A decentralized internet would prevent any sort of censorship.

Here are a few links of Colin talking about Nexus. I was hoping you could take a look. I know this is a hail mary play, but if it does become adopted, it could fix society. In my opinion, Colin is the smartest man on the planet and he shares our view of the world, as you will see if you watch the videos.

https://youtu.be/oNffTAvE1o4

https://youtu.be/5fslTqjorxQ

P.W.
P.W.
1 month ago

I understand skepticism regarding pie in the sky BTC price projections, and I agree on the need for more rational voices in the crypto space.

However, I think a future where CBDCs exist in parallel with BTC, ETH etc. is more likely than the elites simply regulating non-CBDC crypto out of existence. Forcing plebs to wear masks is not the same as torpedoing assets owned by countless multimillionaires and billionaires internationally. IMO they’d be jumping the shark and even if they pulled it off, they’re going to eventually kill the golden goose with such draconian measures…the trend of smart money fleeing the most tyrannical places like California (and the West more broadly) would continue and could go parabolic.

That said, if central banks and govts do cozy up to the crypto space, that doesn’t exactly paint a bullish long term future for BTC either, as everything govt touches eventually turns to sh*t. BTC could also just stabilize at a price where it’s almost impossible for the layman to ever own a whole BTC, and those who have been quietly accumulating at lower prices will just solidify their place as the new rich (which probably has quite a bit of crossover with the old rich).

Jim B
Jim B
1 month ago

Biggest logic fail I’ve ever seen. I won’t address every red herring you serve, but People can be stopped because they wear masks? In case you live in a mainstream media vacuum, EVERY country has had a significant portion of the population REFUSE to be masked or vaccinated. Boris just learned this the hard way in the “papers for pubs” idea backfired so badly he retracted it in hours. The PEOPLE have the power, to threaten the government. Ironically, about the same percentage of non-mask wearers reflects the same portion of crypto holders in most Western countries. You don’t need an entire population to participate (as is shown today) for crypto networks to be viable. (PS. They aren’t ALL money replacements but instead now are actual, functional IT, DeFi, video compression and other services needed for decentralized architecture. To refresh your history – during the American revolution – no more than 30% of the public actually embraced Independence and less than 5% actually fought in it. For most of the battle – only 15% to 20% supported it.

The misinformation of a killer virus isn’t the same as financial freedom. LItecoin’s NimbleWimble decentralizes privacy to the point that even the government can’t track your transactions through FDIC reporting exchanges like Coinbase. Bitcoin could go away tomorrow and there are numerous suitable cryptos (Litecoin, Theta, etc) that erase the ‘green’ energy issue of Bitcoin.

Yes, governments can make it harder for mass adaptation.

The bottom line is whether you believe the Central Banks with 47 Trillion in unfunded liabilities will survive the inevitable coming crash, or whether the growing number of populist governments will return to AT least a precious metal backed fiat and/or decentralized inflation resistant currency like Bitcoin or Litecoin.

Transhuman bro
Transhuman bro
1 month ago

Because we are living in an ever increasing digital world. GameStop is going to cause a stock market crash that the conspiracy theorists have been warning about for years. It’s not a coincidence it’s called game stop.. it’s going to end Wall Street and expose the corruption. With that, we will need a new way to trade, a “decentralised” way to trade. Ooohhh look! How about this whole blockchain ecosystem that already exists and allows us to send data (the new currency) instantly and securely for free anywhere in the world. There are coins that run on AI that do a hedgies job. There are coins that banks are using, that the healthcare industry will use, the oil industry.. there are apps that will use blockchain tech to transfer data between all its users. There are coins you can buy that is equivalent to buying land in the virtual world. I don’t think you fully understand how different the world will be in 10 years time.. this DNA changing vaccine could make us trans human.. one step closer to being a genderless, artificially intelligent being.. like an alien. To achieve that they need to control our communication and our actions and what better way to do that than through a digital ecosystem that they can control but have its users believe is “decentralised”. Bitcoin is just what the media can use to get us introduced to blockchain tech, the alt coins are where the real value lie.

Ugly Old Goat
1 month ago

Great article. The argument you make is valid and has been addressed by Saifedean Ammous, Tone Vays, myself, and others. The “downfall” of Bitcoin will come if and when national governments reassert the gold standard. Most do not see that day coming. I am the exception. I think it is likely not because governments will want to but because they will be forced to. The difference is Bitcoin which operates apart from any jurisdiction will tend to keep the gold standard working. Can you imagine a private digital gold competing with national gold standards? What a different a world we will have with sound money? UOG

Michael
Michael
1 month ago

Good read Chris!

Anyone “should” be able to see that gov wants to worm their way into your crypto holdings. Whether that be taxing, or profiting in some other way.

Look at the US IRS’s little question on the 1040 tax filing form.

“At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?”

Setting the snare already.

I tried to think one step ahead, and have made all my BTC
purchases from a Roth IRA. Will still have to report it,
but any “gains” get to be tax free…

just waiting out the 5 year Roth hold rules. I’ve got 3 years left.

Maybe a decent work around strategy?

Unless you think they will move on it sooner? .

Last edited 1 month ago by Michael
mickyhcorbett
mickyhcorbett
1 month ago

I was thinking about this the other day with regards to NFTs. The transactions are in Etherium as that is the utility token for the network and smart contracts. If you were popular you could end up being “paid” a lot in Etherium. But in the UK you then have to work out what is your tax for these gains. It’s messy at the moment but I could see HMRC starting to accept tokens as payment, as a basic form of tax, but one being removed from currency.

Utility coins may last longer than Bitcoin as by their nature they are transaction lubricant. Bitcoin is a HODL situation for most. There never really has been a decent usable network for it to act like currency because the scope is too broad. It is meant to be a replacement to currency in the eyes of many.

Etherium and the like don’t aspire to the same goal. So maybe when that time comes the utility tokens will stick but Bitcoin won’t.

Palamas
Palamas
1 month ago

Chris,

I always enjoy reading your articles. While it’s not a proof, I firmly believe that our points of view on life show a convergent basis for arguing truth about the world, or reality analysis – I don’t think I diverge from any of your viewpoints on the world as it currently is, or substantially in any investment ideas. I find that astounding especially due to the fact that I’m a Christian in a deranged, anti-christian world (that’s would be our only difference from what I’ve gleaned from other posts of yours – though that would be a fascinating conversation). The world is setting up to be far more dystopian, and it sure is frightening, but it will be quite hard to guess how successful these largely incompetent governments and NGOs are in realizing their dream scenarios, that is, our nightmares.

Incidentally, I’ve been a bitcoin bull for some time now, but not as long as you. I can see your points here and the paradox of BTC as the way out and at the same time, the siren call for governments to thus not allow it, as you state … is pretty undeniable. I guess I’m just looking at the probabilities of BTC somehow slipping through a few different avenues of chaos so we can make it to the other side. To be honest, if it doesn’t, the future isn’t bright anyway. So we might as well try.

Should I still set up shop in Montenegro? Thanks for your great analysis, courage, and informing others on how things are, not how many sheeple and globalists want it to be.

alex
alex
1 month ago

Thank you Chris, very clarifiying and brave article,! However I don’t understand why governments are allowing crypto ETF and derivatives, if in the end they want to ban them…

Adam Dalgliesh
Adam Dalgliesh
29 days ago

What nobody seems to think about in connection with Bitcoin is its complete lack of transparency. We don’t know who issues bitcoin. We don’t know who decides how much, when,
and by whom it is “mined.” We don’t know the identity of the “miners.” Yet there must be someone who makes these decisions. We don’t know who collects the fees levied on those with accounts We don’t know who owns the largest blocks of coin. We don’t even know who created bitcoin.

Investing in something we know nothing about is crazy. It could easily be a Ponzi scheme, pyramid scheme, or pump-and-dump scheme. We simply have no way of knowing one way or another.