I signed up for facts and opinions on how this mother of all bubbles will segue into The Greater Depression. I have benefited on that account, even if you are betting both ways. I write about money and blogged negatively about Bitcoin as early as the Mt Gox days. But I got fed up with following it and had not kept up with its recent history. I hope your identity is impenetrable, for these last two essays are by far the most informative and dangerous for the Bitcoin cult I have seen. Thank you so much and please keep your head down. These guys will do anything to keep the cult in business before they cut and run.
I agree that some in crypto seem content with replacing one set of bankers with a new set of crypto bankers...ie. them. But this post conflates Bitcoin Maximalism with crypto...they are not the same. Ethereum, DeFi, and the bankless movement is much broader than bitcoin. Crypto is about replacing banks with protocols. Not tearing down an old system, building up a new one.
I really enjoyed this article, as it was nice to see some of the scattered concerns I have about the crypto space put into concise thoughts here.
I will disagree with your premise that crypto is our best chance out of this.
Nelson Nash, in his book 'Becoming Your Own Banker' said this:
“If by some authoritative power, all the money in the world was distributed equally among all the people in the world, within 10 years time 97% of the money would be under the control of 3% of the people.”
The problem is not merely in the vehicle that the financial world uses, but is a problem of education and behavior. Crypto, as you've just outlined here, doesn't change this at all, but just trades one set of bankers for another. The same people that have the knowledge and the discipline to acquire and retain wealth will do so regardless of the medium that their wealth takes.
However, the ability to secede from the banking system and Become Your Own Banker has been available since before the 1900s, in the form of dividend-paying Whole Life Insurance, so it has never been a problem without a solution, but merely a lack of understanding.
The one caveat I'll concede is that perhaps the popularity of Bitcoin will lead to a vast economic enlightenment on sound economic ideas. But alas, I fear the greed of the masses will always outstrip the need for education.
The idea that ‘crypto’ is out best shot at removing the negative influence of big-finance is but a religious belief. For whatever problems it might solve, and you haven’t mentioned any, it has multiple more unique problems. The solutions to these problems will require the same kind of regulation and reform.
The biggest problem facing the developed economies is rising inequality. At core this comes down to some people having more money than others and being able to use this difference to increase their wealth.
How, pray tell, will changing publicly issued money to private solve this problem? Your essay refutes this ridiculous idea.
The core of this delusion is rooted in the libertarian fantasy that the problems all result from government spending and money inflation, which can be solved by moving to ‘hard money.’
There is no evidence to support this antiquated idea.
RSA, thanks for bringing light to a dark, doom and gloom article. It’s Defi that’s the hope of humanity. “Ethereum, DeFi, and the bankless movement is much broader than bitcoin. Crypto is about replacing banks with protocols. Not tearing down an old system, building up a new one.“
This may be the best essay on crypto I have seen. The crypto elite has the point of view that just because governments are corrupt and screwing up their fiat currencies, btc must be the answer - ignoring all of the drawbacks of the current cryptos including btc. And you have outlined many of them.
Falling apart? New users every day, massive capital and engineering talent moving into the space and a trillion and a half of market cap. What were you hoping for? Some form of socialism where we all own a tenth of a Bitcoin? You miss the point. Bitcoin is a far superior monetary technology that is far better than gold and certainly better than fiat systems that are miserably broken. Volatility will decrease over time making Bitcoin, Ethereum, and all things crypto more and more usable. If you can make a better case for fiat or sea shells, be my guest. Gold failed a long time ago. Move along…you’ll be happier.
Predicted it months ago (read my comments) Blockchain technology is the real deal and someday digital currency will take center stage. Central banks and global governments will adopt them as a way of preventing hacking & ransom demands as well as 'adjusting' the value of the assets that destroy with their money manipulation.
The 'Little People' (99%) will only be free of this cycle of slavery when they see what the end game is and CLOSE THEIR WALLETS regardless of what type of currency is in them.
I enjoyed reading this. I also enjoyed your Tether write up a week ago. Is there any chance you could share your thoughts about USDC? They have been growing massively the last year. Is it as safe as people think? Or another Tether in the making?
This article needs to be shared, not just across the crypto community, but with anyone with any interest in what the future holds for our economies.
It is worrying that Crypto is 'coming of age' with institutional investors recently joining the party. By having such large stakes in Bitcoin, the 'Whales' manipulate the crypto world just as they have done with legacy markets since they begun. They must be loving their new crypto playground (money go round), as it spins faster and faster until the little guys - aka retail investors that don't have the stamina, lose faith and let go. Ouch!
Probably not what Satoshi had in mind but on a positive note; blockchain technology has at least proven that it works. The building blocks, (no pun intended), are there for everyone to use with potential to demonstrate huge societal, environmental and commercial benefit - or damage.
Huge respect to you for sharing your thoughts and insights the way you do Concoda. Thanks.
A brilliant piece of work Concoda. Stunning, actually. I hold more than a few cryptocurrencies following Eric Wade's advice. I am.late in life and trying to make up financially for taking care of an older, ill sibling and my recently deceased mother-in-law. Following a very educated advisor in crypto, I thought that might be my ticket to make up for losses. I have done well with this. However, the more I read your brilliant work, the more hopeless I become, and fearful that I may lose what I have left for a hope of retirement. You write much to consider.
When central banks will try to push down your deep throat their big fat Central Bank Digital Currency, programable, completely transparent and linked to your ID and social credit, then, maybe, maybe, you will under-stand the power of PRIVATE crypto currencies, and come back to it like a whipped dog.
Remember the saying ... if you can't beat them, join them.
This is exactly what the big players have done again! If there is something that threatens their existence or the status quo, then buy them out, copy them, use their system to your advantage, or sabotage them! The big players have the financial clout and resources to skew things in their favour. You only need to look at the shady practice by many big corporations to fund lobby groups, fake customer groups, etc ... good example is organisations that questionably certify organic food with a logo which is actually funded by these corporations.
I signed up for facts and opinions on how this mother of all bubbles will segue into The Greater Depression. I have benefited on that account, even if you are betting both ways. I write about money and blogged negatively about Bitcoin as early as the Mt Gox days. But I got fed up with following it and had not kept up with its recent history. I hope your identity is impenetrable, for these last two essays are by far the most informative and dangerous for the Bitcoin cult I have seen. Thank you so much and please keep your head down. These guys will do anything to keep the cult in business before they cut and run.
I agree that some in crypto seem content with replacing one set of bankers with a new set of crypto bankers...ie. them. But this post conflates Bitcoin Maximalism with crypto...they are not the same. Ethereum, DeFi, and the bankless movement is much broader than bitcoin. Crypto is about replacing banks with protocols. Not tearing down an old system, building up a new one.
I enjoy your substack!
- RSA
Physical gold and silver are real money. Everything else. Is just a mirage.
I really enjoyed this article, as it was nice to see some of the scattered concerns I have about the crypto space put into concise thoughts here.
I will disagree with your premise that crypto is our best chance out of this.
Nelson Nash, in his book 'Becoming Your Own Banker' said this:
“If by some authoritative power, all the money in the world was distributed equally among all the people in the world, within 10 years time 97% of the money would be under the control of 3% of the people.”
The problem is not merely in the vehicle that the financial world uses, but is a problem of education and behavior. Crypto, as you've just outlined here, doesn't change this at all, but just trades one set of bankers for another. The same people that have the knowledge and the discipline to acquire and retain wealth will do so regardless of the medium that their wealth takes.
However, the ability to secede from the banking system and Become Your Own Banker has been available since before the 1900s, in the form of dividend-paying Whole Life Insurance, so it has never been a problem without a solution, but merely a lack of understanding.
The one caveat I'll concede is that perhaps the popularity of Bitcoin will lead to a vast economic enlightenment on sound economic ideas. But alas, I fear the greed of the masses will always outstrip the need for education.
The idea that ‘crypto’ is out best shot at removing the negative influence of big-finance is but a religious belief. For whatever problems it might solve, and you haven’t mentioned any, it has multiple more unique problems. The solutions to these problems will require the same kind of regulation and reform.
The biggest problem facing the developed economies is rising inequality. At core this comes down to some people having more money than others and being able to use this difference to increase their wealth.
How, pray tell, will changing publicly issued money to private solve this problem? Your essay refutes this ridiculous idea.
The core of this delusion is rooted in the libertarian fantasy that the problems all result from government spending and money inflation, which can be solved by moving to ‘hard money.’
There is no evidence to support this antiquated idea.
RSA, thanks for bringing light to a dark, doom and gloom article. It’s Defi that’s the hope of humanity. “Ethereum, DeFi, and the bankless movement is much broader than bitcoin. Crypto is about replacing banks with protocols. Not tearing down an old system, building up a new one.“
This may be the best essay on crypto I have seen. The crypto elite has the point of view that just because governments are corrupt and screwing up their fiat currencies, btc must be the answer - ignoring all of the drawbacks of the current cryptos including btc. And you have outlined many of them.
Falling apart? New users every day, massive capital and engineering talent moving into the space and a trillion and a half of market cap. What were you hoping for? Some form of socialism where we all own a tenth of a Bitcoin? You miss the point. Bitcoin is a far superior monetary technology that is far better than gold and certainly better than fiat systems that are miserably broken. Volatility will decrease over time making Bitcoin, Ethereum, and all things crypto more and more usable. If you can make a better case for fiat or sea shells, be my guest. Gold failed a long time ago. Move along…you’ll be happier.
Predicted it months ago (read my comments) Blockchain technology is the real deal and someday digital currency will take center stage. Central banks and global governments will adopt them as a way of preventing hacking & ransom demands as well as 'adjusting' the value of the assets that destroy with their money manipulation.
The 'Little People' (99%) will only be free of this cycle of slavery when they see what the end game is and CLOSE THEIR WALLETS regardless of what type of currency is in them.
Happy Saturday!
I enjoyed reading this. I also enjoyed your Tether write up a week ago. Is there any chance you could share your thoughts about USDC? They have been growing massively the last year. Is it as safe as people think? Or another Tether in the making?
What a brilliant, provocative read.
This article needs to be shared, not just across the crypto community, but with anyone with any interest in what the future holds for our economies.
It is worrying that Crypto is 'coming of age' with institutional investors recently joining the party. By having such large stakes in Bitcoin, the 'Whales' manipulate the crypto world just as they have done with legacy markets since they begun. They must be loving their new crypto playground (money go round), as it spins faster and faster until the little guys - aka retail investors that don't have the stamina, lose faith and let go. Ouch!
Probably not what Satoshi had in mind but on a positive note; blockchain technology has at least proven that it works. The building blocks, (no pun intended), are there for everyone to use with potential to demonstrate huge societal, environmental and commercial benefit - or damage.
Huge respect to you for sharing your thoughts and insights the way you do Concoda. Thanks.
A brilliant piece of work Concoda. Stunning, actually. I hold more than a few cryptocurrencies following Eric Wade's advice. I am.late in life and trying to make up financially for taking care of an older, ill sibling and my recently deceased mother-in-law. Following a very educated advisor in crypto, I thought that might be my ticket to make up for losses. I have done well with this. However, the more I read your brilliant work, the more hopeless I become, and fearful that I may lose what I have left for a hope of retirement. You write much to consider.
When central banks will try to push down your deep throat their big fat Central Bank Digital Currency, programable, completely transparent and linked to your ID and social credit, then, maybe, maybe, you will under-stand the power of PRIVATE crypto currencies, and come back to it like a whipped dog.
Incredible insight.
Small derp.
Coins move without keys on chain. Narrative changes. Crypto economy collapses, DeFi dies. BitcoinSV emerges from the ashes like a phoenix.
Remember the saying ... if you can't beat them, join them.
This is exactly what the big players have done again! If there is something that threatens their existence or the status quo, then buy them out, copy them, use their system to your advantage, or sabotage them! The big players have the financial clout and resources to skew things in their favour. You only need to look at the shady practice by many big corporations to fund lobby groups, fake customer groups, etc ... good example is organisations that questionably certify organic food with a logo which is actually funded by these corporations.