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Is ESG, Bitcoin Energy Criticism, Fascist?

Are overreaching ESG standards, which often target Bitcoin’s energy consumption, politically dangerous?

The below is a direct excerpt of Marty’s Bent Issue #1077: “More Unsolicited Thoughts On ESG.Sign up for the newsletter here.

via Aswath Damodaran’s Musings on Markets

I know, I know, I know. Some of you may think Crazy Uncle Marty’s anti-ESG schtick is getting a bit nauseating. However, as you should have realized by now, I cannot control myself. When I think there is a good point to be made about the subject, I will make it. And that is what I am here to do today.

The above snippet comes from a blog posted yesterday by Aswath Damodaran, a professor of finance at the NYU Stern School of Business, which builds on a post he published last September that began to dissect the ESG movement in the capital allocation space and beyond to determine whether or not it is a productive framing to conduct business and life. I highly recommend you take the time to read both pieces because Aswath does an incredible job of breaking down the thesis behind the investment strategy, how it gets implemented in the real world, its failure to accomplish its stated goals, why it can never accomplish its stated goals, and a better framework from which to approach “doing good”.

To summarize the core argument that Aswath makes; ESG does not work because it ignores the existence of free will and reduces individuals and individual processes into uniform inputs in a rigid mathematical function that spits out an ESG rating. At its core, this type of grading/rating system cannot work because, again, it ignores the existence of free will and the subjectivity of “goodness” in the eyes of two different individuals. It is literally impossible to settle on a ratings system that people are able to agree on. And since that is the case, any ratings system that is brought to market will inherently carry the biases of those who construct it; governments looking to acquire more power over their subjects and corporations looking to leverage advantages provided by regulatory moats.

Not only that, when these investment strategies are applied, they do not produce a return profile that is desirable. So this movement is crowding smaller players out by increasing the cost to comply and producing bad returns for investors. A lose-lose for most economic actors.

Now, if this is the case why are so many people pushing for it? Well, as Professor Damodaran so eloquently describes in his latest post on the subject; because most individuals don’t want to take personal responsibility and extreme ownership over their impact on the world. Many are so lazy that they would rather have the government, capital allocators, and corporations make these decisions on their behalf and provide them with an “ESG-certified” label they can point at and say, “See, I’m doing my part!” Completely glossing over the fact that when these personal responsibilities are handed over to bureaucrats, bureaucrats are going to do what bureaucrats do – whether they’re political or corporate bureaucrats – manipulate the system in their favor while making everyone else worse off.

Politicians will attempt to gain more control and some corporations will attempt to leverage it to create an artificial moat around their businesses to artificially reduce competition. Which leads to another interesting line of discussion under the overarching ESG topic; is it a form of Fascism? I think you could make a very good case that yes, yes it is. And nothing made this clearer to me than a clip that was floating around Twitter earlier this week of Dave Smith educating a fellow panelist about how Mussolini defined Fascism.

“He defined it as a merger between Corporation and state.”

While Dave may have been articulating this to make a point about how vaccine mandates can be considered Fascist, I think we can also apply this to what is happening throughout the ESG movement. Via the direction of the UN (a group of coordinated countries – the state) and the “climate change goals” they have arbitrarily set for the global population, corporations and capital allocators are beginning to direct the means of production and pick winners and losers via an ESG ratings system built around those arbitrary and subjective world views. Favoring some forms of energy and boardroom structures over others while failing to be open about the tradeoffs that are being disregarded. A good example of this is wind and solar being favored as energy sources for being “green” when they leverage an immense amount of hydrocarbons and slave labor on the front and back end of their lifecycles.

By creating arbitrary and rigid guidelines which entrepreneurs must operate within, the state and the corporations who are best positioned to benefit from these arbitrary guidelines dictate the means of production in a subversive fashion. There is no overt physical seizing of the means of production. Instead, the means of production is slowly but surely nudged in a certain direction until the desired amount of control is in the hands of the state and its corporate cronies.

As a bitcoin miner, this issue has become very clear to me. In a sane world bitcoin mining would be viewed as a massive boon for conservationism. For the first time in human history we have a mechanism by which we can profitably monetize previously wasted and stranded energy assets. The natural incentives of the network force miners to drive their electricity costs down as low as possible and the best way to do that is to seek out wasted and stranded energy sources that no one else is willing to utilize. Bitcoin miners will show up in the middle of nowhere to utilize energy that was LITERALLY BEING SET ON FIRE without producing any positive economic value. Definitionally making the world more energy efficient.

Not only this, but the miners utilizing that previously wasted energy are doing so to profitably facilitate and secure the best monetary system humanity has ever come into contact with. A monetary system which will end the mis-pricing of opportunity costs that is induced by the ability to print money out of thin air. As Steve Barbour said during a conversation on the topic we were a part of earlier this afternoon, it punishes the misallocation of capital, which leads to less unnecessary consumption. When governments and central banks print money out of thin air to save companies that have misallocated capital and resources to an extent that they are in danger of going out of business, they perpetuate that misallocation of capital and resources, which one can argue is a net negative on the environment and society overall.

I’m sorry for rambling, freaks. I just had to get these thoughts off of my chest after reading Aswath’s blog last night and partaking in a conversation on the subject this afternoon. I will leave you with the actionable advice from Aswath’s blog post, which I think is a much better framework for individuals, business, and investment professionals to approach the concept of “doing good in the world”. It should be based on your personal values and not a top-down diktat defined by a very narrow set of values.

via Aswath Damodaran’s Musings on Markets

Source: Bitcoin magazine

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Crypto News Updates

Supply Dynamics Indicate Upcoming Bitcoin Price Rise

HODL waves data show that bitcoin demand is outpacing supply, indicating an upcoming BTC price rise.

The below is from a recent edition of the Deep Dive, Bitcoin Magazine’s premium markets newsletter. To be among the first to receive these insights and other on-chain bitcoin market analysis straight to your inbox, subscribe now.

We have been covering the bullish bitcoin supply dynamics extremely closely over the last few months, as we believe this to be the fundamental driver of price action in this market. The monetization process of bitcoin unfolds as adopters acquire bitcoin for a price that they believe to be undervalued and HODL until this is no longer believed to be true. This act reduces the free float or supply available on the market, and as additional participants also wish to hold the asset, less satoshis are able to go around. Simple supply and demand tells us that only one thing can occur: the price of bitcoin rises.

Today we will review some recent HODL waves data for an up-close view on HODLer activity.

The percentage of the bitcoin supply that has moved within the last three months is tied for an all-time low, with the other instance occurring at the bottom of the 2015 bear market. Said differently, 85% of the circulating bitcoin supply has not changed addresses in the last three months, an all-time high (tied with the instance in 2015).

Below is the same data but viewed in opposite ways: 

Bitcoin: HODL Waves, Supply Active During Previous Three Months
Bitcoin: HODL Waves, Supply Active Greater Than Three Months

Similarly, supply last moved more than five years ago has hit an all-time high, coming in at 22.76% of circulating supply. While undoubtedly some of this can be attributed to lost coins (see: increasingly-large purple band of supply last moved greater than 10 years ago), nevertheless this contributes to the supply-side dynamics currently playing out in the market. The supply of coins that have not moved in over 10 years is approximately 2.25 million BTC, and a large proportion of these coins can be presumably counted as lost, including Satoshi’s estimated 1 million plus BTC stash (which has never moved).

Bitcoin: HODL Waves, Supply Active Greater Than Five Years

 The bitcoin thesis is simple:

We are witnessing the rise of an emerging global monetary asset, the likes of which none of us have ever seen. The monetization process of bitcoin is an opportunity that only presents itself once, and from a game-theoretic perspective, your only choice is to play (acquire and HODL bitcoin).

Source: Bitcoin magazine

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Crypto News Updates

The State Could Try To Leech Off Of Bitcoin Rather Than Banning It

Governments truly wanting to “beat Bitcoin” may carefully consider siphoning the value gained through bitcoin.

I think at the end of the day if it’s really successful, they will kill it and they will try to kill it. And I think they will kill it because they have ways of killing it. -Ray Dalio on Bitcoin

Banning Bitcoin is a practical impossibility. The incentives are such that Bitcoin will prevail in the long term as the savings technology of choice, but that doesn’t mean the state will give up its power as a monetary monopolist without a fight. The brighter minds among the ruling class will attempt to emerge undefeated from the upcoming turbulent times.

Government Bans Don’t Work

One of the best definitions of the state was formulated by Max Weber, calling it entity that has “a monopoly on violence.” The state uses this monopoly to further entrench and strengthen said monopoly, with the goal being to attain more power over society. Direct state monopolies have been pretty much discredited by economic disintegration whenever tried throughout history. So the modern approach for the state to control various industries is to do it indirectly. Two popular ways to achieve indirect control are to either ban the particular industry or to steer it via a combined force of taxation, regulation and surveillance.

Bans aren’t very effective. The history of major bans is a testament to the futility of banning an activity or resource that has strong demand.

The U.S. alcohol prohibition that was in effect between 1920 and 1933 is a prime example. A research paper from 1991 summarizes its effects as follows:

Although consumption of alcohol fell at the beginning of Prohibition, it subsequently increased. Alcohol became more dangerous to consume; crime increased and became “organized”; the court and prison systems were stretched to the breaking point; and corruption of public officials was rampant. No measurable gains were made in productivity or reduced absenteeism. Prohibition removed a significant source of tax revenue and greatly increased government spending. It led many drinkers to switch to opium, marijuana, patent medicines, cocaine, and other dangerous substances that they would have been unlikely to encounter in the absence of Prohibition. Mark Thornton: Alcohol Prohibition Was a Failure

The War on Drugs, which began in the 1970s, saw similar results. According to a 2017 Cato Institute analysis, these are the effects of 50 years of drug prohibition:

  • Overdose deaths increased from 1 per 100,000 in 1971 to 12 per 100,000 in 2008.
  • Drug potency increased, with consumption shifting from softer drugs like marijuana to hard drugs like opioids.
  • New synthetic drugs such as crack cocaine and fentanyl emerged with a devastating effect on its users and their communities.
  • Enforcement costs taxpayers $50 billion annually; the initial budget approved in 1972 for drug-related policies was $1 billion for a three-year program.
  • The 50-year war gave rise to ruthless Mexican drug cartels and aviolent government response — the Mexican drug war itself has claimed an estimated 300,000 lives since 2006.
  • A policy known as civil asset forfeiture became normalized, under which enforcement agencies can seize any assets belonging to a drug-related suspect. The amount of such seizures is staggering: “In total, the Department of Justice’s Asset Forfeiture Fund confiscated nearly $94 million in assets during 1986, its second year of operations. By 2011, this number had ballooned to approximately $1.8 billion [annually]. State and local seizures have followed similar trends.”
  • Other consequences include police militarization, widespread corruption, increased oppression of minorities and foreign military interventions.

The drug trade is also the main source of illicit funds and money laundering problems, similar to how illegal alcohol was the major source of illicit funds during the alcohol prohibition.

Now the purpose of this article isn’t to comment on alcohol or drug policy. The point of this rather lengthy introduction is to illustrate that government bans are ineffective when aimed at curbing activities that are in high demand. Wherever persistent demand exists, supply will, uh, find a way.

A classic line from Jurassic Park.

Failed attempts at banning a particular industry gradually transform into the second type of state control: indirect, by way of taxation, regulation and subsidies. We have seen this development with the alcohol industry and the same is happening with the drug industry; cannabis use and trade is already legal in 18 US states and all types of drugs decriminalized in Oregon. The alternative to bans for the state isn’t to declare a free market, but rather to dominate via licensing requirements and to extract rent via taxation.

Are You A Good Citizen Or A Money Launderer?

Contrary to what Ray Dalio thinks, it’s becoming clear by now that Bitcoin isn’t going to be banned in the way alcohol or certain drugs were banned. Governments, or rather experts in appropriate agencies, have done their homework. They know they can’t ban Bitcoin in any meaningful way.

There won’t be a war on Bitcoin. Not in the sense of an eradication attempt.

Instead, the state is going to go straight to indirect control, while it still can — before the process of bitcoinization reaches an event horizon, before the emergence of the bitcoin circular economy and widespread sats-based wages and before we can do away with fiat on-ramps.

Bitcoin itself cannot be banned but people interacting with it can be surveilled, prosecuted, fined or jailed. Plus, most of the massive value that bitcoin will generate over the coming years can be siphoned away from the holders. This can be done by dividing prospective bitcoin holders into two categories:

  1. Good citizens: everyone wishing for bitcoin’s price exposure can do so in a compliant manner via exchanges and similar service providers. Good citizens don’t come in direct contact with the Bitcoin protocol and are discouraged from withdrawing bitcoin into their wallets. Transactions among regulated service providers are allowed; good citizens would be able to send bitcoin from Coinbase to PayPal, for example. Everything is fully KYC’d and custodied so the government has an easy time taxing away most of the value gains while the honeypot of personal data grows ever larger.
  2. Money launderers: direct interaction with the Bitcoin protocol is effectively illegal due to regulatory requirements that cannot be met on the individual level. Violators will have their bitcoin confiscated.

I believe establishing such an environment is the dominant motivation for the cryptocurrency provisions in the recent U.S. infrastructure bill. As many have pointed out, the definition of “brokers” in the proposed legislation is technically ignorant and doesn’t take into account how the Bitcoin protocol works. Yet there was no will to acknowledge these shortcomings and bring the provisions closer to reflecting the technical reality.

The vagueness of this text means that everybody running their own node or mining on U.S. soil could potentially violate the law. The full text of the bill is available here, with specific sections on reporting for digital assets on page 2433.

I don’t think this is a case of incompetence. From the state’s point of view, a regulation of this kind isn’t a problem — it’s a solution.

The state isn’t aiming to have “regulatory clarity” (whatever that means), or to ensure consumer protection or to curb money laundering. The aim is to scare coders and businesses in the Bitcoin ecosystem into adopting bitcoin in an approved manner, via surveilled venues from which there won’t be any escape, and to siphon off the value that bitcoin will generate in the coming year, both from exchange-held IOU bitcoin and from sovereign bitcoiners.

Siphoning Off Bitcoin Value Gains

According to a recent survey conducted by NYDIG, about 46 million Americans, or 17% of the US adult population, “own” bitcoin; it’s unclear how many of these simply have an account on Coinbase instead of truly holding bitcoin, but let’s assume that at least half of them hold their own keys (a very optimistic assumption). This would mean that less than 10% of the U.S. adult population hold any bitcoin.

If we further assume that bitcoin is going to keep on winning against fiat as a supreme store of value, it’s only natural that the majority of the American population will look to gain some sort of exposure to bitcoin in the coming years. And the way that this precoiner majority gets exposure is what’s at stake today. The state still has the chance to drive the majority into compliant walled gardens. It’s kind of similar to legalizing cannabis via regulated dispensaries, where everything is done in a regulated, recorded and thoroughly taxed manner.

The truth is that the majority of the population will be satisfied with having some exposure to bitcoin’s price, without having anything to do with Bitcoin the protocol. Most won’t even mind very much when the withdrawal process is greatly limited or disabled “for user safety.” The small minority of cypherpunk bitcoiners will be subject to prosecution, because they will always be in violation of the law — by running their node or mining without following the technically infeasible KYC requirements, or by developing or using an anonymous open source wallet.

Thus the state can siphon off most of the value that bitcoin will generate in the coming years.

Once the majority is captured in compliant walled gardens and the minority can be prosecuted at will, it’s pretty straightforward:

  1. Bitcoin on exchanges will be subject to an annual unrealized capital gains tax. This may sound outrageous now, but there are ways to propagandize this into acceptance. We are currently heading into the greatest economic recession since the Great Depression. Everyone will be asked to do “their share” — and taxing half of the annual gain (in fiat terms) won’t be viewed as such a great sacrifice. The tax would be automatically deducted from the user’s account balance.
  2. Bitcoin held by sovereign hodlers would be subject to civil asset forfeiture — a process already widely used in the war on drugs and cheered on by good citizens. Everyone can choose to follow the law, after all.

The End Game Is To Own As Much Bitcoin As Possible

It’s fully plausible that people in the government understand the end game that hodlers play. Some might even be well-versed in the writings of Saifedean Ammous, Vijay Boyapati or Robert Breedlove. They know they have to do something, while also knowing that banning bitcoin is a fool’s errand. Embracing bitcoin in a compliant manner and scaring away people from a sovereign approach is the one shot the state has at surviving hyperbitcoinization.

The winning scenario for the state isn’t to ban bitcoin, but rather confiscating as much of it as possible and controlling the flow of the remainder. This doesn’t mean that all nation-states will do this; some will rather seek to attract Bitcoiners fleeing from those predatory regimes. It’s important to stay vigilant, hold your own keys, care about your privacy and be open to a scenario where relocation may be necessary in future.

This is a guest post by Josef Tětek. Opinions expressed are entirely their own and do not necessarily reflect those of BTC, Inc. or Bitcoin Magazine.

Source: Bitcoin magazine

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Why Generation Z Loves Bitcoin

A generation whose known nothing but mounting government debt finds the value in absolute scarcity.

I am a zoomer, you may have heard of us — self entitled, spoiled and good at tech. I recently graduated from high school, attended university and entered the workforce. If you have done any of these things in your life then there is a good chance that you’re a human, and this article is relevant to you. Although this writing is tailored to younger demographics it still applies to everyone.

I’ll begin bluntly: you are operating your life at a loss — surprise! Now let me explain. Time is money and money is time, literally. Every day that you go to work you trade your time and energy for yet-to-be-redeemed credits of other peoples’ time and energy. This technological innovation is called money.

As a zoomer, I have many daily purchases and some life goals. I buy a coffee most mornings and one day I would like to own a house. I also have a savings account full of yet-to-be-redeemed credits. If I choose to not redeem (spend) these credits immediately, then they continuously lose value. With every second that goes by, the morning coffees and that future house get more expensive. As a result I’m able to ask less and less of other people’s time. Why is that?

These items get more expensive because governments use expansive monetary policies like low interest rates and money printing. I have no control over these expansionary monetary policies nor do I benefit from them. A cup of coffee, if I were alive in 1970 might have only cost me 25 cents; today it costs me upwards of $5! If we continue along the government’s targeted rate of inflation, that cup of coffee may end up costing me more than $10 before I even retire.

It’s an uphill battle!

I have to run faster and faster just to stand still and so do you. The current financial system is designed around “growth” at all costs. The economy is dependent upon debt-fueled consumption for consumption’s sake.

Consider the impacts of this on the environment. If the incentive is to quickly spend the money you earn today before it loses value, then resources are being dug up and mined before they would otherwise need to be. The “live for today” mentality comes at the expense of a better tomorrow. By today’s measurements of growth, or Gross Domestic Product (GDP), a cyclist ruins the economy because they do not buy cars, gasoline, insurance, or have car crashes. However, a fast-food outlet is great for the economy because it creates cardiologists and sick people who demand medicine and treatment.

Here’s the real kicker: the debt that has been generated is what we are about to inherit. We are on track to pay for all of the existing debt from past generations. Tax rates will be hiked, cheaper credit will be enforced, and dollars will be helicoptered into our financial system. Whether through taxes or inflation we will trade our time to pay for someone else’s mistakes. Unless, of course, we hold bitcoin.

A boomer told me once that he had solved the world’s debt crisis and explained that future generations would just pay for today’s consumption. I politely explained back that “I store my wealth in an unconfiscatable asset so that I can’t be forced to pay for your government’s egregious misallocation of resources.” I ask this question to you, the reader — do you?

Money is possibly the most important human construct after mathematics and language. For millennia, societies have employed either a token-based monetary system, like gold or seashells, or a ledger based system, like the fiat currencies of today. Throughout human history, the technology used for money has slowly and constantly evolved.

A fixed money supply means that human beings more intently vet their spending decisions, act less wastefully, and focus more on what’s important for the future. If your time and energy are stored in a non-confiscatable & non-inflatable asset, then you cannot be forced to pay for a previous generation’s decisions. How does that sound?

Bitcoin is a digital monetary network, native only to the internet. It has no physical form and crucially it has a verifiably limited supply. Bitcoin is the first iteration in human history of a proprietary token-based system backed by a distributed ledger. Because of the fixed supply, your claim on society’s time can not be diluted.

Bitcoin is one of the most risk-asymmetric trades anyone, especially a zoomer, can make. It has limited downside, yet it has an infinite upside. There is a non-zero percent chance that bitcoin will go to $1 million in our lifetime, but there is a 0% chance that your and my dollar savings will maintain value over the next 10 years.

With bitcoin in my pocket I run with the wind at my back and I swim with the current.

Special thanks to @BTCSchellingPt , @nikcantmine , @aurumbtc and Del for helping to edit this piece.

This is a guest post by Lawson Enright. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.

Source: Bitcoin magazine

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No Taxes for Foreign BTC Investors in El Salvador!

El Salvador has announced that foreign bitcoin investors will not have to pay tax on the profits they make through cryptocurrency transactions.

El Salvador Makes Things Easy for Foreign BTC Investors

The news comes just a little over a week after the Central American nation declared bitcoin legal tender. El Salvador is the first nation to make such a move, and now it looks like several others – such as Paraguay – are interested in following in the country’s footsteps.

Government advisor Javier Argueta says that this is likely a move to encourage foreign investment in the country. In a recent interview, he states:

If a person has assets in bitcoin and makes high profits, there will be no tax. This (is done) obviously to encourage foreign investment… There will be no taxes to pay on either the capital increase or the income.

While there are steps in place designed to increase investment in El Salvador, Argueta – who also serves as a personal advisor to president Nayib Bukele – says that there are also measures being instilled to ensure that none of the foreign investments are illicit, and that money laundering does not take place within El Salvador’s borders.

He explained:

We are implementing a series of recommendations from international institutions against money laundering.

The road to bitcoin legalization in El Salvador has not been an easy one. The nation initially sought the help of major institutions such as the World Bank to implement its bitcoin agenda. The Bank ultimately said “no,” deciding that bitcoin was too risky and volatile. El Salvador then decided to move forward on implementing a digital future without assistance.

The country even built a whole new digital wallet system known as “Chivo,” which is slang for “cool” in the country. The wallet was designed to assist citizens interested in trading bitcoin learn about the world’s number one digital currency by market cap. It even gifted many eligible traders with approximately $30 in BTC to help them get started.

BTC Doesn’t Intrigue Anyone

However, there were several individuals heavily opposed to the bitcoin agenda that El Salvador is so adamant about instilling. Protests have been forming in the country’s capital of San Salvador over the past several weeks, with people holding up negative signs and honking bullhorns to state that they are “just fine” when it comes to using the U.S. dollar, which is the currency that El Salvador has been reliant on up until this point.

Bukele has since come out to let people know that bitcoin is not being forced up on them. They simply have the option of using it should they so choose. He says that bitcoin is being adopted primarily to ensure that remittance payments become easier for people sending money home to their families while working abroad in the United States.

The post No Taxes for Foreign BTC Investors in El Salvador! appeared first on Live Bitcoin News.

Source: Live Bitcoin News

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Bringing Bitcoin To Ethiopia With Kal Kassa

Bitcoin advocate Kal Kassa discusses bringing Bitcoin to Ethiopia and its potential in Africa at large.

Watch This Episode On YouTube

Listen To This Episode:

Spreading knowledge about the power of Bitcoin doesn’t just happen by accident. Getting information out to those who need it requires expertise and concerted effort from someone like Kal Kassa.

Kassa works with the Lightning Network and is taking on the charge, pouring energy into bringing awareness into more secluded regions. On this episode of the “Bitcoin Magazine Podcast,” we had the privilege of being joined by Kassa as he discussed his work in Ethiopia and the broader narrative around Bitcoin in Africa.

“I hope to be considered a champion of financial inclusion and not a threat, or an illicit or like criminal actor, but if they do consider me as criminal I’m fine to wear that burden as well,” Kassa said.

Kassa uses remote efforts to empower niche populations through distributed currency, but the corruption and array of problems facing the country mean that regaining some agency through Bitcoin would be real progress. Kassa explained exactly how he envisages this happening, and the most urgent areas needing attention. Later in the episode, we got to pick his brain and dive deep into his long-term perspective on Bitcoin’s role in Ethiopia and Africa at large.

“Bitcoin is here for the long haul,” he said. “Bitcoin will last longer than any of these states and any of these, let’s say, corrupt leaders.

Make sure to join us for this illuminating conversation with Kal Kassa!

Source: Bitcoin magazine

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Crypto News Updates

Why ECB President Christine Lagarde’s Latest Stance On Bitcoin Is A Good Thing

ECB President Christine Lagarde’s recent remarks that bitcoin is not a currency show that central banks fear losing power.

European Central Bank (ECB) President Christine Lagarde was interviewed on Bloomberg TV on September 13, which aired yesterday, September 15. Among the topics discussed, which included monetary policy, debt, and gross domestic product (GDP) of countries in the European Union (EU), Lagarde also shared her view on Bitcoin and “cryptocurrencies.”

“Cryptos are not currencies. Full stop,” Lagarde emphatically said in the video. “Cryptos are highly speculative assets that claim their fame as currency, possibly, but they’re not. They are not.”

More than just bashing out at “cryptos,” Lagarde shows a deep need to suffocate something that threatens her job and its agenda. Putting “cryptos” aside, which are indeed not currencies, there is Bitcoin that is not only a currency but has the potential to turn the ECB and other organizations that have the monopoly on money creation worldwide wholly obsolete. But before discussing Lagarde’s agenda as the head of the ECB, the meaning of “currency” needs to be determined.

What Is A Currency?

Merriam Webster’s definition of currency categorizes it as “something that is in circulation as a medium of exchange.” On the other hand, the noun phrase medium of exchange is defined as “something commonly accepted in exchange for goods and services.”

Currency is then something used for someone in exchange for some other product or service. But this medium of exchange role of money is only one of the many characteristics of a good monetary medium. Money also serves as a store of value and a unit of account.

Does this mean Lagarde doesn’t understand what a currency is? Unlikely. As the head of one of the leading central banks globally, it is fair to expect her to know what a currency precisely is. The catch, however, is that it is in her best interest to promote her institution’s and her fellow central banks’ currencies at the expense of others. If Bitcoin were irrelevant and posed no threat to central banks, the ECB President would simply not be talking about it.

Mainstream media will undoubtedly share Lagarde’s remarks, and the general public might even see them as the truth. Well, let it be that way. In the end, it is free press for Bitcoin. People historically selected which monetary goods to use based on the benefits they brought to those utilizing them, but in the past couple hundred years, central banks have dictated what ought to be adopted by determining the mediums with which citizens can pay their taxes  until Bitcoin came along.

Bitcoin Is A Currency

Bitcoin, born just twelve years ago, is long past being magic internet money. The peer-to-peer digital monetary network idealized and invented by Satoshi Nakamoto has grown over the “collectible” status to start being recognized as a store of value. Indeed, high-profile investors in developed economies are stating how superior it is to gold  the best store of value for centuries.

The meaning lies in the historical path monetary goods usually take from inception to becoming accepted and used worldwide. New money historically starts as a collectible item, something a tiny percentage of the population sees value in and purchases for different reasons. As its value increases over time and the money perdures, more people notice, increasing adoption and enabling it to be seen as a store of value. Then, the money is mainly hoarded as more and more people acknowledge its demonstrated ability to increase purchasing power compared to other well-established money in that society. This stage is likely where Bitcoin is currently at.

Investors, companies, and people around the world are waking up to Bitcoin’s value proposition. As adoption increases, the peer-to-peer digital cash will keep progressing in its monetary path to become a widely accepted medium of exchange. Lastly, with sufficient adoption, bitcoin can get recognized as a unit of account.

National currencies are the only kind of currency being used as units of account, each in its own country, due to political mandates and lack of legal options. However, in the medium of exchange side, different goods can often be used as the transacting parties see fit based on their own needs.

This is already playing out in many countries in the world. Kenya, Nigeria, and other African countries are becoming hotbeds for Bitcoin usage as a store of value and a medium of exchange as citizens face currency debasement, monetary colonialism, and scarce access to the banking system. Similarly, in Central America, El Salvador recently adopted bitcoin as a legal tender after the Bitcoin law was enacted last week. Where the majority of the population doesn’t have a bank account, real change is happening with Bitcoin.

Central Banks Fear Bitcoin

Lagarde’s comments on Bitcoin and “cryptos” bring to light the fear of those who currently hold the monopoly of money creation. Their actions of moving towards central bank digital currencies (CBDC) further showcase an attempt to tell the public, “hey, we can be digital too!” But the people won’t be fooled.

Satoshi Nakamoto created parallel money that doesn’t require permission from a central authority to be used. Bitcoin allows people of any background, nationality, religion, and race to access sound money.

Beyond empowering those marginalized by the permissioned monetary system pushed forward by the ECB, the Federal Reserve, and the International Monetary Fund, Bitcoin also provides everyone with an opportunity to be their own masters  something a digital euro or digital dollar will never be able to accomplish.

Bitcoin was created as a direct response to the bailouts given to the banks that caused the subprime crisis in 2008. Big corporations can afford to be reckless because there’s always a friendly central bank to rescue them and pardon their debt while the average citizen pays the price.

But apparently, only now have those central banks noticed the reason why Satoshi Nakamoto and the cypherpunks before him brought Bitcoin to the world, and they can’t help but fear the end of a centuries-long monopoly. They aren’t at ease with the idea of seeing the end of a colossal power that empowers banks, corporations, and influential individuals at the expense of regular citizens who work hard to pay the very taxes that sustain such a system. But the people say no more; because now, they have Bitcoin.

Source: Bitcoin magazine

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Crypto News Updates

Lenny Moon Is Pushing Fly Coin, a Digital Currency Designed to Reward Frequent Fliers

We’ve all heard of frequent flyer miles. The more you fly, the more miles you’ll earn for future trips. Well, a cryptocurrency company is pushing a new digital asset known as Fly Coin, which will pay users in digital currency granted they engage in specific travel behaviors.

Fly Coin Will Reward Consistent Travelers

The company has recently brought on a new chief executive officer in the form of Lenny Moon. Moon will be tasked with overseeing the market launch of the company. He will also work to expand its horizons and develop a strong operational business plan that will see additional customers flocking to utilize its services and rewards.

Fly Coin has been around for some time already and has been available to flyers of the Ravn Alaska Airline. However, now it looks like Northern Pacific Airways is hopping onboard. The airline is responsible for flying customers of the U.S. to several airports in both Asia and Europe by way of Alaska. Fly Coin and Lenny Moon are looking to ensure more airplane companies “hop aboard” and that additional air travel routes can be utilized to offer customers digital rewards.

Josh Jones – the founder and chairperson of Fly Coin – mentioned in a statement:

Consumers deserve a better reward point system, and the time is now. Our mission is to empower travelers with a crypto-backed rewards system. Its open protocol and finite supply of tokens takes power from the airlines and puts it right into users’ wallets. Moon is the perfect person to accelerate our progress in this endeavor.

In an interview, Moon explained:

The traditional world of travel rewards programs is ripe for change. Fly Coin will provide consumers with a rewards program where the benefits are open and less confined. A cryptocurrency is the medium to reward our loyal customers for traveler participation, but not force their loyalty by constraining how they choose to redeem those rewards. I am excited to lead Fly Coin as we help provide a more customer-centric approach to travel rewards programs. With this organization, and Josh Jones’ experienced understanding and proven success with cryptocurrency, Fly Coin seeks to empower our customers to become decision makers.

Crypto and Travel… They Really Go Together!

Moon will also take on the role of serving as the new chief financial officer of FLOAT Alaska LLC, the parent company of Fly Coin. Tom Hsieh – president of FLOAT – was also quick to praise Moon and tout his experience, mentioning:

Moon brings over two decades of experience in startups, venture capital, investment banking, and fintech. He is an astute professional with strategic vision, financial clarity, and extraordinary operational acumen. With such extensive experience and expertise, Moon will accelerate the status quo of travel rewards programs.

Not long ago, it was alleged through a recent study that more people were utilizing bitcoin and crypto for travel purposes.

The post Lenny Moon Is Pushing Fly Coin, a Digital Currency Designed to Reward Frequent Fliers appeared first on Live Bitcoin News.

Source: Live Bitcoin News

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Crypto News Updates

Hungary Debuts Statue In Honor Of Bitcoin Creator Satoshi Nakamoto

Hungary becomes the first country to honor Bitcoin creator Satoshi Nakamoto with a public statue.

Today, a statue of Bitcoin creator Satoshi Nakamoto was revealed in Budapest, Hungary in front of a large and passionate crowd. “The goal of the statue is to honor Satoshi Nakamoto, the founders believe that his work is truly something to be remembered,” said the initiative’s website.

This bronze statue located in Graphisoft Park was sculpted by Gergely Réka and Tamás Gilly. When sculpting this statue, the pair really wanted to capture the mantra of “we are all Satoshi,” making Satoshi’s face reflective, so when you look at the statue you remind yourself that you play just as an important role in Bitcoin as Satoshi and everyone else does. This is also because the gender, height, weight, and age of Satoshi Nakamoto are unknown — making it impossible to sculpt a descriptive face of whoever Satoshi was.

I love how this faceless statue plays into Elizabeth Warren’s comments this past July calling Bitcoiners a “shadowy faceless group of super coders.” Because it does not matter who Satoshi was as an individual. All that matters is that Satoshi created a decentralized protocol that allows anyone to transfer value in real time without permission from anyone. This “faceless super coder” changed the world for the better by giving people financial hope and opportunity where there was none. Just because someone protects their identity online does not mean they have ill intentions, something Warren has yet to understand.

The statue features Satoshi wearing a hoodie with a recent Bitcoin logo on it — but not the “BC” logo that Satoshi originally started out with. Though it’s important to note there is no “official” logo for Bitcoin, and whatever is used most is what has been popularized by Bitcoiners from all over the world.

Earlier this year, in June, a rough draft of the statue was released to the public. And just a few months later, the statue was built and revealed.

Source: Bitcoin magazine

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Crypto News Updates

How Bitcoin Fixes The Money, Saves The World

How bitcoin will change the world as sound money in the “fourth turning,” society’s latest major shift.

Two things are undeniable: We are living in times of massive change, and Bitcoin is a part of it.

We are living in times of massive change, a “fourth turning.” The book “The Fourth Turning” by Strauss and Howe covers centuries of history and shows that demographics and other factors lead to massive change in societies every 100 years or so.

Generations change distinctly: the ’60s were different from the ’50s and the ’80s. But a fourth turning is a different level of change. If history is any indication, in this fourth turning we will see changes in maps, society, religion, belief systems and we may see the very nature of economics and money itself change.

Bitcoin came into the world at the right time. Any earlier, and Bitcoin could not have practically been used due to internet usage rates. It is interesting that Bitcoin is here just as the global economy faces such massive change to the old-school fiat system that has been running for the last half century and driving our world into the ground. The old fiat system is unsustainable. Bitcoin presents the ultimate hedge against the failed monetary policies of central banks.

It’s key to remember that central banks don’t just devalue the money of citizens, their very existence causes some of the greatest evils that we see in modern society. In a world of sound money, people would value their hard-earned coins more. People would also have custody and control over their own money. If politicians had to convince people to voluntarily pay for wars, for-profit prisons, and heavy regulations. citizens would exercise much more scrutiny over where their money is spent.

Whether you believe the narrative of bitcoin as better money or not doesn’t matter. It would be hard to deny that we are in a fourth turning right now. The last year and a half has seen some of the most dramatic change that people have seen in the last 50 years or more. So, there is no question that we are in times of massive change. The only question is what role Bitcoin will play in this.

Bitcoin has been around for 12 years now and has created wealth and built an entire industry around itself. Bitcoin is now held by tens of millions of people and has become a global phenomenon. Bitcoin is on the radar of everyone in the world, from the poorest to the richest, from the vaunted halls of power to the streetside corner store.

We will never know how Bitcoin would’ve done without the extraordinary economic events of the last several years. The massive spending which began more than 20 years ago and started reaching unsustainable levels around 2008 with government bailouts has been thought to be unsustainable by many for several years. This last year we have seen more money printing than what we’ve seen ever before in history.

This massive money printing increases Bitcoin’s appeal. Bitcoin is a more major part of the global financial system than most realize. This is not reflected in the market capitalization right now. Bitcoin is still smaller than Apple, but its impact, importance and its message is much greater. We have a country adopting bitcoin as legal tender. We see major banks and brokerages offering bitcoin exposure and bitcoin-related products. We have an entire industry with varying degrees of quality which has cropped up around and adjacent to Bitcoin.

When you think about Bitcoin relative to the current world and the backdrop of the weaknesses in the central banking system, it’s not so lofty to say that Bitcoin just might save humanity. Remember that the problem with central banking only begins at the debasement of the money of the people. The true problem is that it centralizes power and creates these massive money honeypots which contractors vie for. The Afghanistan war alone cost taxpayers — specifically children who will be paying this debt for years — $2 trillion. The most effective way for government contractors to receive handouts in the deca-billion range is to promote fear. So, now we have companies that have a vested interest in promoting fear so that taxpayers will support giving their own money back to those companies. This is the end of an empire with broken thinking — it leads to death and it’s evil. And Bitcoin fixes this.

There is so much broken in the current system that it is very difficult to fight. An alternative way to fight is through peaceful use of another form of money. If you deny the politicians their money, then you deny the tyrants their money. Money of the people is more peaceful. Money of the people is free of coercion. It’s voluntary. It can be one of the most meaningful revolutions the world has ever seen without anyone needing to fire a shot.

The good news is that we have Bitcoin. The good news is that we can see light at the end of the tunnel. We can starve the beast of war and aggression which is fueled by fake fiat money printing processes. We can build a society based on voluntary exchange of trade and with the foundation of solid, sound money. The kind of money people measure wealth in. Like gold of centuries past. Sound money inspires savings, it inspires wise investment, it inspires people to avoid risks and it fosters innovation.

Some fourth turnings see even more significant epoch shifts in the world, such as the creation of the printing press. The technological revolution that we are in right now and that Bitcoin is a central part of will see our global economic system and monetary systems radically change.

Overall, this change will be for the better. Just as we saw a separation of church and state centuries ago, we can see a just separation of money and state today. People using voluntary decentralized money would be a freer people and centralized powers will have their significance reduced.

The old saying “money is the root of all evil” is wrong. Indeed, this is an easy mistake to make — for money and economics has been at the center of much of our world struggle. Great evils such as slavery, wars and great things like trading routes, art, languages and culture have all been influenced by money. Money has been one of the most crucial tools for the growth of humanity. Money is a way for people to share value based on goods and services provided to them.

We cannot only reduce the power of tyrants and evil, we can increase the power of the people with sound money. Fix the money, fix the world.

This is a guest post by Bruce Fenton. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

Source: Bitcoin magazine