Counter-Trading The FUD – Bitcoin Countertrade of the last decade

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In today’s Money Morning…the hardest money… the sad truth? Musk has his muzzle firmly in the hollow of the fiat… context is everything… and more…

I have been in Bitcoin since late 2013 and over that eight year period I have seen all types of attacks come and go.

“China controls it.

“Governments are going to ban it.”

“Quantum computers will destroy it.

“It has no intrinsic value.

“It’s too slow and too expensive.

And many others…

In the crypto world, we call these arguments FUD.

It represents “ fear, uncertainty, and doubt, ” and it’s used to try to keep ordinary people away from bitcoin.

Whenever a new piece of FUD takes hold, the mainstream media jumps on it to say it’s the end of bitcoin.

In fact, bitcoin has been declared ‘dead’ over 400 times since 2010 as this site follows here.

But bitcoin is alive and well and it will be a long time to come.

In fact, the FUD counter-trade was the best trade of the decade …

The hardest money

There is no doubt that FUD attacks harm the Bitcoin [BTC] short term price.

The price of BTC is notoriously volatile and it is difficult for the average investor to make good decisions in the heat of the moment.

Many buy when it pulls higher and sell when it dips lower.

And yet, if you zoom out a bit, you can see that bitcoin is still more resilient:

Over time, you can see how the “boom and bust” of the last cycle ends in simple failure.

I personally had to endure a two year bear market between 2014 and 2016 with an 80% plus drop in the value of BTC before seeing any gains on my initial bet.

You can hardly see this “scary weather” on the chart now!

The point is, while the odds are sharply opposed – a whole system of crooks, middlemen, and skinny guys playing the money system in their favor – bitcoin is now a serious alternative.

And in turn, a threat to the fiat sauce train.

Which brings me to the last series of FUD …

The sad truth? Musk has his muzzle firmly in the hollow of the fiat

Tesla founder Elon Musk made a great song and danced about investing in bitcoin earlier this year. Even saying that you can now buy a Tesla with Bitcoin.

But he shocked the crypto markets last week by reversing that stance, saying:

Are we really to believe that Elon Musk invested nearly US $ 2 billion in bitcoin without understanding the Proof of Work (POW) system which is the backbone that secures the network?

The only possible answers here are:

  1. He’s incredibly incompetent
  2. He is completely dishonest

I opt for option two and that’s why:

See, just the day before Musk’s backflip, it was reported on Reuters that Tesla was trying to get approval for a new US government’s renewable fuel credit program.

They wrote:

Tesla Inc (TSLA.O) is seeking to enter the US multi-billion dollar revolving credit market, hoping to profit from the Biden administration’s march towards new zero-emissions goals, two sources familiar with the matter said.

The electric car maker is one of at least eight companies with a pending Environmental Protection Agency application related to power generation and renewable credits, the sources said. The EPA produces a list of pending applications with some details, but not the names of the companies.

Further research revealed that Tesla was quite desperate to be accepted into the new program after an old system that required gasoline-powered automakers like Chrysler to purchase Renewable Energy Credits (RECs) from Tesla likely succeeded. its end.

Tesla made US $ 1.58 billion selling these RECs last year. Much more than selling cars!

And even when it comes to CO2 emissions, Musk’s hypocrisy is staggering.

As Coin Metrics founder Nic Carter noted in a tweet:

Of course, Musk has no problem selling Tesla’s to coal-starved China.

Either way, in my opinion, Musk’s change of mind is purely motivated by self-interest. An attempt to get their hands on the gravy train of free government dollars.

It’s truly sad …

But that seems to be the way it is now for a very large number of companies. The begging bowl comes out whenever they are in trouble.

So much for free markets and capitalism, eh?

But let me end with the central point behind the FUD.

Is bitcoin bad for the environment?

Context is everything

Yes, the process of securing the Bitcoin network relies on electricity.

But that in itself doesn’t make it bad for the environment.

The people who say this are usually the ones who see no interest in bitcoin. In their minds, any amount of CO2 emissions spent on BTC is therefore “bad”!

If you think the fiat money system works well, if you think centralized control of money where the printing of government money dictates who wins and losers, if business becomes a game of your closeness to the golden goose that lays fiat … so alright, BTC has no value.

But if you think that a decentralized money system, free from government control, a system that allows open and permissionless transactions in a free market, is a noble cause; then bitcoin is the best chance we have.

Or as Michael Saylor, founder of MicroStrategy said:

But let’s also put Bitcoin’s energy consumption in context.

Consult this table:

More electricity is actually used on clothes dryers in our homes than on bitcoin. Ban dryers!

Then there’s the fact that a huge amount of energy used in the BTC mining process comes from renewable energies.

You can never know for sure, but some studies have suggested that bitcoin mining uses almost 75% renewable energy.

And that number will only increase.

You see, the bitcoin mining process actually lends itself to harnessing the power of renewables in remote locations that wouldn’t otherwise be economical.

Think of Iceland, Siberia, or even the Australian outback.

As Tillman Korb, director of Genesis Mining, a bitcoin mining company, told EuroNews:

Cryptocurrency mining can also help power grids operate more efficiently and increase their use of renewable energy, Korb adds.

He believes renewable energies are the natural future of cryptocurrencies. As the value of Bitcoin rises and the rewards for mining decline (a feature built into the cryptocurrency as more coins are “discovered”), electricity costs must come down.

“There is more pressure on the cost side, for the miners and for this reason, only renewables can be the source of energy,” Korb says.

“If you just look at the incentives, it doesn’t make a lot of sense to use coal.”

Then there is this coup de grace …

Let’s also compare bitcoin to competing currency systems, okay?

As it stands, bitcoin consumes less energy than gold mining (with much less environmental and political consequences) and much less than the current banking system with its army of money-cutting middlemen. tickets.

Listen, I’m definitely not saying bitcoin is a green solution.

But what I can say with confidence is that the folks who are broadcasting FUD about this don’t have the first idea of ​​how it works.

This is how FUD works.

It’s an emotional argument meant to manipulate.

And as I explained at the start, historically, listening to such an uninformed (and I would say manipulative) FUD has been a terrible decision for investors.

Bitcoin’s transparent system makes it an easy target for simplified arguments, which do not stand up to scrutiny.

If you really want to look at some more facts on the “ green ” question, this page here is a great place to start.

Some of these issues are complex, some are transient, and some of them are real issues to be addressed as bitcoin evolves.

There are nuances in all of this.

But just remember Bitcoin’s promise: to remove the power of centralized power over money.

If you don’t understand the importance of this first, then none of this will ever matter to you …

Good investment,

Ryan Dinse,
Editor, Silver morning

PS: Bitcoin against gold – Expert reveals how these assets stack up as investments in 2021. Click here to find out more.

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