Compare: The Strategic Beanie-Baby Reserve. What does it accomplish? Betraying American taxpayers in order to enrich the manufacturer and collectors.
P.S.: For that matter, why not the Strategic Russian Ruble Reserve?
Sure, it means asking US taxpayers to suffer in order to prop up a warmongering dictator whose local propaganda is that America might need to be nuked, but modern Republicans think it'd be awesome 'cuz reasons.
The Beanie Babies could at least be burned for fuel if we were really desperate and no one wanted to buy them (and the government didn't want to play Santa). Crypto is almost the opposite, we burn fuel to get it and if no one wants to buy it, you couldn't even use it to make children happy.
It's a 3 TRILLION dollar market...so far!
Looks to me like people want to buy it.
For context, the Beanie Baby craze in the 90's at peak, was $2.6 Billion dollars adjusted for inflation today. Crypto is world wide phenomena, and so far, is 1000x larger. It also has utility for those that don't like bank lineups and banker's hours.
PS. FYI The Atlantic has become an extreme left leaning digital publication (source: https://www.allsides.com/news-source/atlantic). It stopped writing balanced articles years ago. Too bad, because it used to be great.
It is, however, strongly correlated with value. Therefore, if you want to argue that any specific asset is overvalued (or has no value at all), the onus is on you to provide an actual argument and not a lazy slogan.
What kind of usefulness threshold would Bitcoin have to reach for you to assign value to it?
Is 25 million wallet not enough? Given that a wallet is basically a bank account except it cannot be seized by a government, a bank can't stop transfers, a bank employee won't demand to know why you're withdrawing the money and you can access your satoshis anywhere in the world.
Is 420 million Bitcoin owners enough?
Multiple Bitcoin ETFs? Legalized in multiple countries?
Bitcoin ETF becoming the fastest growing ETF ever?
Blackrock recommending 1-2% portfolio allocation to Bitcoin?
El Salvador stacking on bitcoin?
Strategy becoming the best performing stock in recent years with a simple strategy of stacking bitcoin?
> Given that a wallet is basically a bank account except it cannot be seized by a government
All wallets could become worthless in a weekend if a government makes the wrong stride in quantum research..
El Salvador is not recommending Bitcoin and found low interest in actual use.
Madoff also had a fund that could return very well. Satoshi just has to show up and cash out to ruin his pyramid or push the pyramid entirely to the US tax payers right now. Seems improbable like the chairman of NASDAQ running a scam..
These bizarre scams have no place in a real economy and we have to get rid of 0% interest to kill this garbage.
> All wallets could become worthless in a weekend if a government makes the wrong stride in quantum research..
No need for the wrong stride in quantum research. A government can make it illegal and seize the exchanges and watch actual value go to a round 0 in seconds.
A nation's government has a vested interest in preserving the value and viability of its own currency, not Bitcoin's.
If quantum computing breaks Bitcoin hash then it also breaks any other encryption so I can ssh to your server, login to your bank account, change the code in your github repo.
> El Salvador is not recommending Bitcoin and found low interest in actual use.
El Salvador is not a person.
The president of El Salvador is hardcore Bitcoin believer. El Salvador, the country, is stacking as much Bitcoin as they can, despite pressure from IMF that tries (I wonder why?) to stop them.
> Madoff also had a fund that could return very well
Except he didn't. He was lying about returns of his investments and it crashed and burned when the truth came out.
Blockchain is fully transparent. Every Bitcoin transaction ever made is recorded in immutable database and you get to read the full ledger, from the day it was created.
There is no way to lie about Bitcoin transaction. The current price is decided by an auction with millions of participants.
> If quantum computing breaks Bitcoin hash then it also breaks any other encryption so I can ssh to your server, login to your bank account, change the code in your github repo.
OpenSSH >9.0 has algorithms in place for the post-quantum world:
* ssh(1), sshd(8): use the hybrid Streamlined NTRU Prime + x25519 key
exchange method by default ("sntrup761x25519-sha512@openssh.com").
The NTRU algorithm is believed to resist attacks enabled by future
quantum computers and is paired with the X25519 ECDH key exchange
(the previous default) as a backstop against any weaknesses in
NTRU Prime that may be discovered in the future. The combination
ensures that the hybrid exchange offers at least as good security
as the status quo.
Quantum research is nothing but a scam designed to extract grant money and pump share values higher until they can actually factor a number larger than 21 using Shor's algorithm. They did that in 2012. Everything since then has been smoke and mirrors. For as much as you want to call Bitcoin a scam, you're relying on an incredibly more obvious one in your hatred of it.
Additionally, El Salvador is only "dropping" bitcoin (officially) because they are being economically pressured by the IMF. So much for sovereignty for the little guy and democracy (he WAS elected, you know?).
I find the scientific community that is either researching or confused by quantum phenomenon to be a lot more legitimate than the financial community who are either researching or confused by blockchain.
Bitcoins price 1818: $0
Largest number factored with Shor's algorithm, 1818: 0
Bicoins price 1920: $0
Largest number factored with Shor's algorithm, 1920: 0
AI winter means ChatGPT is a figure of our collective imagination or that past performance doesn't predict future returns or the rate of scientific developments?
Maybe you have a real thought on that instead of an arbitrary comparison of numbers that don't really relate.. I.e. Quantum research investment would be at least be a faith number that says something about the number of believers in something. What that has to do with the possibility that it falls apart I don't know.
Yeah, I have a real thought: QC is a scam, and you're buying into it. Not much more than that.
If you want to put this to an empirical test, you should buy $10 worth of quantum computing stock and $10 of bitcoin and see which performs better over the next 10 years.
QC might be impossible and some involved may view it as just an income scam, I simply doubt that they all do.. I don't really see a difference in bitcoins price. A large portion of crypto mercenaries are no doubt propping up even the more legitimate coin prices by utility in pig butchering, etc, in getting a mark into the right behaviors..
I don't know if the pricing of the champagne in the "champagne room" should be taken as reflecting market sentiment just because it has been globalized. In some sense any kind of scam that runs long enough is just the regular market, but if it has no legitimate revenue I think it must reach the plateau where it can't fulfill the fad function of investing in it. What is the market for currency as a casino, Forex is only half that illegitimate purpose and it doesn't command much respect.
The cryptocurrency space is going to be much more than a "casino" in the near future. You can already buy tokenized stocks and treasury bills if you're not a resident of the USA. Trump said crypto capital, so expect at least that and a lot more. Why should stock market trading be limited to when the NYSE is open, anyway? Pay attention to what Eric Trump says about WLFI.
Without Chelsea Clinton's endorsement, I don't think I could possibly use a 24 hour day trading tool. The US is a flim-flam nation now and you shouldn't buy all the crap they sell each other on TV.
In something like transportation one is betting real returns come in before the asset is worthless. Bitcoin has no return so one is betting the asset goes up because it is scarce and you get out before it is worthless. Real estate at least has rents or personal use.
The return of Bitcoin that it represents the next step towards a superior form of money and an evolution of how financial systems work in a digitized world. It's "stock price" increases the more true and realized this idea becomes.
Real estate has taxes, insurance, repairs, tenants that can trash your place, competition from other real estate, illiquidity, high transaction costs, hurricanes, fires, floods, riots, is impossible to move.
Nope, not at all. Stocks represent partial ownership of a company. If you buy all the stock for a company, you own the company. Companies are valuable because they (ideally) make a profit for the owners.
Bonds are valuable because the company or government that issues them signs a contract to pay out a certain amount on them. They won’t always do that, but thats why we have rating agencies to help investors understand the risk.
The closest equivalent to crypto in traditional assets is probably precious metals and gemstones, though even those typically have some industrial uses to drive demand.
Diamonds are a great example of the downside of looking at the market value of something alone. The natural diamond market has been massively disrupted by the rise of artificial diamonds and diamond alternatives.
Great argument. "I don't believe it has value, so it doesn't." Well, keep telling yourself that. I'm sure you feel just as smart as you did when you dismissed bitcoin at $1,000, and you'll feel just as smart dismissing it at $1,000,000.
I’m not dismissing it. I’m saying that it’s different than traditional investments since most of the potential uses are still speculative, whereas it’s pretty obvious what value you can get from ownership of a company or a barrel of oil.
To expand on my previous response: econ 101 teaches us that the price of any non-scarce product will converge to the cost of production plus some small profit margin.
Tulip is not a scarce asset because you can make more tulips. If cost to produce a tulip is $1 dollar and the price spikes to $100 due to demand outstripping supply, people will be incentivized to grow more tulips.
At some point they'll grow enough tulips for supply to meet the demand and they will have to sell tulips at merely small profit. In fact, some will likely have to sell tulips at a loss due to overproduction.
Mona Lisa doesn't have this problem. There's only one Mona Lisa so as long as demand goes up, the price goes up.
Bitcoin doesn't have this problem. There's a hard limit of 21 million bitcoins that will ever exist. As long as demand for bitcoin goes up, the price goes up.
> As long as demand for bitcoin goes up, the price goes up.
And as long as the demand for Bitcoin goes down, the price goes down.
There's nothing magical about scarcity. The amount of Enron stock certificates issued was finite, but I'm not sure buying them would have been a good idea....
Pardon my ignorance here, but don’t the central banks of most nations hold foreign currencies in a strategic reserve? I feel like we probably already have Ruble reserve.
On one hand, multiple years of Russian government-controlled television running professional segments, depicting potential targets, stock footage of missiles flying and exploding, with supporting quotes and appearances from Russian government figures.
On the other hand, you recently saw *checks notes* internet randos venting, displeased how a portion of their government bends over backwards to appease Russia for no legitimate reason.
You want us to believe those are even remotely comparable? Weak.
If you don't believe that long-term Bitcoin is going 10x - 100x and becomes, at the very least, a planetary store of value, then of course Strategic Bitcoin Reserve doesn't make any sense.
If you do believe that then you understand why any person, company or country will benefit financially by stocking up on Bitcoin today.
If you believe that Beanie babies or russian ruble will 10x - 100x then you would believe that any person, company or country will benefit financially by stocking on beanie babies today.
That wouldn't be a strategic reserve, just a speculative investment. You might ask why the US doesn't also invest in AAPL and NVDA. You might also consider the "soft power" effects of the US using the global middle class as exit liquidity.
Ignoring arguments on semantics (the meaning of "strategic"), here's the difference between AAPL or NVDA and Bitcoin.
In the long term AAPL and NVDA market cap / stock price will converge to their future financial performance and historically speaking it's guaranteed that those companies will decline. So if you're looking for a really long term investment, it's not a good one.
This is different than U.S. buying Alaska from Russia. There's only one Alaska, if U.S. has it then no-one else has it.
Bitcoin was designed to have the same scarcity as land. There's only 21 million bitcoins and if you buy 5 of them today, no one else will own those 5 until you sell them.
If you believe that Bitcoin will become the largest "store of value" asset class that any person, company or country buying Bitcoin today will benefit compared to people / companies / countries that do no buy Bitcoin today.
Is such belief speculative? Of course it is. Buying Alaska from Russia was also speculative purchases. Not everyone thought it was a good deal and no-one knew it has gold and oil.
Is there strategic benefit to U.S. to owning scarce financial asset?
Well, U.S. does benefits from dollar's status as world's reserve currency. If Bitcoin does become planetary store of value and planetary currency, it's better for U.S. to own larger part of it than China or Russia or Iran.
Cryptocurrency peddlers only have two arguments: fiat currency has no value, and bitcoin is gonna 10/100x in its fiat currency value. Well, which one is it?
If a group of people has all the bitcoin in the future, and other people have possession of things they want/need... Well, the value of bitcoin will be zero unless you can compel people who possess actual useful and necessary things to accept it. Which you can do if you are a government with power of taxation. It actually has negative value, because you need the computers running the software that represents it to keep running.
I really cannot figure why people think bitcoin is special. The value of money comes from the power of taxation, not from the underlying representation of the money.
Though much of the controversy is around the inclusion of ripple, solana, and cardano. There's no reason to have these in the reserve. Might as well hold GME in there too.
You can't have stablecoins, smart contracts, and an entire crypto economy on Bitcoin alone. Trump said crypto capital. I'm personally expecting grocery stores to start showing you a QR code for stablecoin payment over your preferred chain next year.
Even if everything is as rosy is all that, there's another big problem:
Why would you want men with guns taking away your money (and mine) to buy crypto for their own uncontrolled slush-fund purposes, instead of letting you invest it yourself??
And no, don't even get me started on how Social Security is different, because insurance plans are not the same as the somebody else's investment account.
P.S.: For that matter, why not the Strategic Russian Ruble Reserve?
Sure, it means asking US taxpayers to suffer in order to prop up a warmongering dictator whose local propaganda is that America might need to be nuked, but modern Republicans think it'd be awesome 'cuz reasons.