Tag Archives: bitcoin

Bitcoin Doesn’t Need Anything, Bitcoin Is Already A Store Of Value

Posted on by
Reply

Bitcoin is a store of value, over time.

Bitcoin doesn’t need to have a perfectly stable price over time.

Bitcoin doesn’t need to be used in daily transactions. 

Bitcoin doesn’t need to be able to be transacted in 1 second.
Bitcoin doesn’t need to cost $0.01 to send $1 billion across the world. 

Bitcoin doesn’t need to be the only money in the world, it can exist alongside government currencies, just like gold does today. 

Bitcoin doesn’t need intrinsic value

Bitcoin doesn’t need a government to give it value.

Bitcoin doesn’t need to run NFT and smart contracts on it’s base chain.

Bitcoin doesn’t need to change the maximum number of 21 million bitcoin.

Bitcoin doesn’t need BIPS (Bitcoin Improvement Protocols)!

Bitcoin needs the properties of a sound money.

It should be scarce. 

It should be divisible.

It should be transmissible.

It should be immutable. 

It should be difficult  (or impossible) to counterfeit.

It should be assayable (easy to verify it is what it says it is).


Bitcoin has all these things already. 

It just needs to be “adopted as a treasury reserve asset” to quote Michael Saylor. Meaning people just need to choose to preserve their wealth in bitcoin, over time.

People don’t need to store all their money in bitcoin. A small percentage of people in the world own gold, but it still has value.

Bitcoin doesn’t need to be used in daily transactions to have value. Gold has value but it is not used in daily transactions.

Bitcoin doesn’t need to be “legal tender” to have value. Gold has value but it is not legal tender. 

Money should only be used as money. If you give it some other use or value, it’s possible that it’s main use, as money, is twisted such that it’s monetary value gets distorted and it is no longer a good money!

I encourage you to ask questions about “What is Money?” What is the purpose of money? Why do we need money? What things does money need to do to make it useful?

Bitcoin Market Cap, How Much Could 1 Bitcoin Be Worth?

Posted on by
Reply

Much of this post was taken from this tweet from  MD₿TC@MDBitcoin. I felt this information was very helpful so I wanted to share and expand on it.


Original tweet below

The Inevitable Path of #BTC 

I. Global wealth = between $400-$900T

II. Let’s say 10% of Bitcoins are lost.

III. Let’s do a conservative estimate that #BTC captures  ONLY 1% of global wealth, the value of one #Bitcoin would be? 

then imagine 5%?, 10%? 20%? 50%?  

There is no other path, accumulate as if your life depended on it. 🟠

Complete Calculations:

Available Bitcoins:

Total Bitcoin Supply: 21,000,000

Lost Bitcoins: 10% of 21,000,000 = 2,100,000

Available Bitcoins: 21,000,000 – 2,100,000 = 18,900,000

1% of Global Wealth:

Lower Bound:

1% of $400T = $4T

Value of one Bitcoin = $4T / 18,900,000 ≈ $211,640.21

Upper Bound:

1% of $900T = $9T

Value of one Bitcoin = $9T / 18,900,000 ≈ $476,190.48

5% of Global Wealth:

Lower Bound:

5% of $400T = $20T

Value of one Bitcoin = $20T / 18,900,000 ≈ $1,058,201.06

Upper Bound:

5% of $900T = $45T

Value of one Bitcoin = $45T / 18,900,000 ≈ $2,380,952.38

10% of Global Wealth:

Lower Bound:

10% of $400T = $40T

Value of one Bitcoin = $40T / 18,900,000 ≈ $2,116,402.12

Upper Bound:

10% of $900T = $90T

Value of one Bitcoin = $90T / 18,900,000 ≈ $4,761,904.76

20% of Global Wealth:

Lower Bound:

20% of $400T = $80T

Value of one Bitcoin = $80T / 18,900,000 ≈ $4,232,804.23

Upper Bound:

20% of $900T = $180T

Value of one Bitcoin = $180T / 18,900,000 ≈ $9,523,809.52

50% of Global Wealth:

Lower Bound:

50% of $400T = $200T

Value of one Bitcoin = $200T / 18,900,000 ≈ $10,582,010.58

Upper Bound:

50% of $900T = $450T

Value of one Bitcoin = $450T / 18,900,000 ≈ $23,809,523.81

Buy the quantity that you can and put it in cold storage, wait a decade and watch the inevitable path.

-End original tweet. 


There is a lot to unpack there. 

Let’s start with the basics. 

There is between $400T and $900T of wealth in the world. 

For reference at bitcoin’s current price of $26,000 and total coin maximum number of bitcoin ever of 21 million coins, bitcoin’s current market capitalization is $546 billion. This is between 0.067% and 0.13% of all the value in the world. That’s pretty small currently!

Gold has a current market capitalization of $12 trillion. 

That comes to between 1.3% -3% of all the value in the world. 

As noted above, if bitcoin was to capture 1% of the world value  it would be worth between $211k and $476k per coin. This doesn’t even get it to the same market capitalization as gold!

Lower Bound:

1% of $400T = $4T

Value of one Bitcoin = $4T / 18,900,000 ≈ $211,640.21

Upper Bound:

1% of $900T = $9T

Value of one Bitcoin = $9T / 18,900,000 ≈ $476,190.48

Since bitcoin has many features that make it more useful than gold it has a good chance of at least gaining the adoption of 1% of the store of world value. Bitcoin doesn’t have to be used for every daily transaction for it to be useful or valuable. Gold has value and it is not very useful at all for daily transactions. 

Bitcoin has multiple benefits over gold, it can be sent around the world nearly instantly, it can be broken down into very small units (1 satoshi = 0.00000001 bitcoin  which at $26k/bitcoin = $0.01 is equal to 37 satoshis) and various other benefits that bitcoin has). 

These are just a few of the reasons that I think Bitcoin will likely continue to stay around as a store of value and continue to gain adoption and grow in price and value.

How To Buy Bitcoin

Posted on by
Reply

As bitcoin continues to be adopted many people will have a lot of questions. One of the main questions is probably “How do I buy Bitcoin?”

Here is the quickest and likely one of the safest ways to buy bitcoin, go to the google play store (or apple store) on your phone and download “Cash App”. 

Link your bank account. 

Click “Buy bitcoin”. 

Boom, you now own some bitcoin!

I recommend Cash App because they are a Bitcoin only company. There are many copies of Bitcoin like Bitcoin Cash (BCH), Bitcoin Satoshi Vision (BSV) and many others. Don’t be fooled. Only buy Bitcoin (BTC ticker symbol). Since Cash App only sells Bitcoin (BTC) this is not a problem. That is why I recommend Cashapp for starting.
Companies like Robinhood, Coinbase and others sell Bitcoin (BTC) but also sell others like Bitcoin Cash (BCH), Bitcoin Satoshi Vision (BSV), Ethereum (ETH) and thousands of other cryptocurrencies. You want to buy Bitcoin (BTC) only. 

Now you can start learning about bitcoin. Luckily Cashapp has news articles about bitcoin linked in it’s app so you can read there.

You can also follow Michael Saylor on Twitter. He has a lot of great information about bitcoin. One of the best podcasts I have heard about Bitcoin is “The Saylor Series” By Robert Breedlove on the “What is Money Show”. 

Now, owning bitcoin and holding it on the Cashapp app isn’t the safest way to hold bitcoin. While Cashapp is relatively safe, there is still risk that Cashapp goes under. 

An option now is to download a hot wallet to your phone like Muun Wallet, or GreenWallet (from the company Blockstream),  also from the google play store. You can then transfer your bitcoin from Cashapp to your hot wallet, if you want. You don’t have to do this. You can keep your money on Cashapp. It’s like keeping money at a bank. Using Muun wallet is like keeping cash in a safe at your home. I would suggest learning more about wallets before you transfer your bitcoin to a wallet. I also wouldn’t buy thousands and thousands of dollars in bitcoin until you understand it more. 

Continue to learn more about Bitcoin through various articles. Don’t buy more Bitcoin than you need. You only need as much as you’ll never sell. Bitcoin is not a thing to sell. Bitcoin is a thing to buy, regardless of price.
Don’t panic sell your Bitcoin if the price goes down from $100k to $50k or even $30k again! This is the nature of bitcoin, it is volatile.

Don’t FOMO into thousands and thousands of dollars of Bitcoin unless you are ready to temporarily lose 50% or more.

Don’t invest any more into Bitcoin than you are willing to lose. While I think it will be fine, it’s always possible something wild could happen and it could go to $0 (I doubt this but keeping all possibilities open).


Welcome to Bitcoin!

Oh, and you can always contact me with Bitcoin questions!

BIPs Biggest Threat to Bitcoin

Posted on by
1

Reply to – 

A u s t i n | Open Source Fitness

@_AustinHerbert

If #bitcoin fails, we’re fucked. But at this point, how does #bitcoin fail? one sentence ↓

My 1 sentence reply – 

Biggest threat to bitcoin is BIPs Messing with the btc code and making it not btc. BIPs should take min of 10 yrs to review/run on another chain first etc. Mostly I’m against BIPs  “Bitcoin Introduce Peril’s”

My longer reply – 

What is the point of a BIP (Bitcoin Improvement Protocol)? It is to change the Bitcoin base code that is running on nodes to “improve” Bitcoin in the eyes of the people proposing the improvement. But what needs to be changed with Bitcoin?

The critical things to make Bitcoin Bitcoin are:

21 million coins which supply never increases – That already exists. 

Bitcoin needs to be able to be transferred – This is possible on the base layer. That is the whole point of bitcoin, to transfer value.

These are the only things that are important to bitcoin. Lightning network (allows very small transactions to buy a coffee, etc) is very nice and convenient. But you don’t need it for a currency or store of value. Gold has a market cap that is 10x bitcoin. No one is buying coffee with gold.

I think the Bitcoin community needs to be very skeptical of any BIPs and should really resist most BIPs aggressively. 

The necessary thing for bitcoin is adoption. From all the people I have talked to about bitcoin and money a total of 1 has really understood how money works or the value of a store of value that doesn’t have inflation as a possibility. I think people who are working on BIPs could serve bitcoin much better by teaching people about bitcoin and how it works than trying to change it and potentially destroying it.

Is Now A Good Time To Buy Bitcoin?

Posted on by
1

Is now a good time to buy Bitcoin? I think it’s going to $10k in a few months. These are the type of things people say when I ask why they don’t own any bitcoin. 

Questions I prefer to ask them are “What is your time horizon?” What is your goal with buying this bitcoin?

If you want to double or triple your money and “get rich” when bitcoin goes to $100k and sell it then no it’s not a good time to buy bitcoin. It actually never is. That is speculation and I hate speculation, in the stock market, or in anything really. That shows you don’t understand the point of bitcoin. Bitcoin should be held forever or at least until $1 million/ coin. I pick $1 million/coin because I think once it’s worth $1 million per coin it will be much more obvious that it is a store of value.  When it’s worth that you may think “Why would I sell this for USD?” You can probably trade it directly for goods and services at that level.
If you have any plans to sell bitcoin in the short term, just don’t even buy it. 

Consider if you buy bitcoin now the downside is $26k to $0, or whatever amount you invest.

The upside is infinite, when measured in dollars.

21 million bitcoin that will ever exist, divided by 8 billion people = .002625 bitcoin per person. 

X$26,000 (current bitcoin price) = $68

So if you invest just $68 you can at least secure your equal amount of bitcoin. 

Get your fair share of btc today.

Realistically even owning 0.002625 bitcoin is more than a lot of people ever will because as we know no money is equally distributed. So the average person will likely own less. That is actually ok. Wealth inequality is the expected state since people have unequal talents and are willing to take different levels of risk.
Bitcoin is your chance to opt into a system that doesn’t reduce your wealth via inflation though!

Once you own a little bitcoin you’ll be more inclined to learn more about it. I bought it for the first time in 2017. Then got distracted by a different coin , litecoin, that was “a better bitcoin”. I lost money on litecoin but continued to learn. Eventually I came to learn the problem that bitcoin solves and why there can’t be a better bitcoin.

“If you don’t believe it or don’t get it, I don’t have the time to try to convince you, sorry” – Satoshi Nakamoto ,  creator of bitcoin.


While Satoshi is probably right that he didn’t have time to try to explain it to you, I think I do. I enjoy trying to help others learn about bitcoin. Don’t hesitate to ask questions if you are genuinely interested in bitcoin!

Bitcoin Catalysts

Posted on by
Reply

Bitcoin has a slew of catalysts on the horizon. The first three are increasing demand/buyers.

  1.  As I’ve written about before Microstrategy, the public company that owns the most bitcoin is selling $750 million worth of new stock to buy more bitcoin. 
  1. El Salvador, the first country to make bitcoin legal tender, is on their way to selling $1 billion in bitcoin bonds. $500 million will be used to buy bitcoin directly.   $500 million will be used to buy bitcoin miners. 
  1. At least 7 Bitcoin Spot ETF’s have been filed in the USA. This in itself is not new. There have been many filed in the past that have been rejected, for no good reason. The first one filed in this latest round has been pushed off by the SEC and opened for comments by the public, a delay tactic. But they can’t delay forever. They have to give a final ruling in January 2024. Many other countries around the world have bitcoin spot ETFs active. There is no good reason to not approve one. One will eventually be approved in the USA either now or later. Once that happens there will be a lot of new buyers of bitcoin. Currently it is rather difficult to buy bitcoin with many funds, 401k’s, IRA, regular brokerage account. But when you are able to buy a bitcoin spot ETF in any of those funds with money you already have in those accounts that just opens a lot more money to buy bitcoin. 

The 4th catalyst is a supply reducing catalyst. The next bitcoin halving is currently going to happen on April 17th, 2024. Bitcoin miners are rewarded for protecting the bitcoin network with “new” bitcoin. They have to sell a lot of these bitcoin to pay for their electricity costs. They currently receive 6.25 BTC per block. In April 2024 it will drop to 3.125 BTC. Since there will be less bitcoin being sold by miners, if the demand remains the same it’s likely bitcoin will appreciate in value. 

While bitcoin is very volatile it should be remembered that the goal of bitcoin is to not be volatile. It is currently volatile due to all the people speculating on its future value. Some people bought it 6 months ago and it’s doubled in price so they are selling because they have made 2x their initial money. In the long run bitcoin’s price will only go up as the value of goods grows. It will only go up with inflation. That is the end goal of bitcoin.

Tesla Should Accept Bitcoin NOW!

Posted on by
Reply

As both a Tesla shareholder and a Bitcoin holder, I think it’s time Tesla starts accepting bitcoin for payments again.

Tesla currently holds hundreds of millions of dollars in Bitcoin on their balance sheet. 

Tesla accepted bitcoin for Tesla purchases for a very short time in 2021 but then quit accepting it due to concerns about the emissions from bitcoin mining.
His “rules” laid out above in a tweet June 13th, 2021 was that Tesla would resume accepting Bitcoin when bitcoin mining was using greater than 50% green energy. It has been clearly shown by the Bitcoin Mining Council that bitcoin mining is 59.9% green! 

“Based on this data, the global bitcoin mining industry’s sustainable electricity mix has improved marginally to 59.9% and remains one of the most sustainable industries globally,” the report stated. – Bitcoin Mining Council

Direct link to Bitcoin Mining Council Q2 2023 report. 

This is well above the goal set by Elon for Tesla of 50%. Because of this, I think Tesla should immediately start accepting Bitcoin for payments again.


Of course Elon could be waiting for “reasons”.

One might be that he expects whenever Tesla starts accepting Bitcoin to have a small flood of buyers. He might be waiting for this until a time that he perceives that he needs a small demand boost? This is my only speculation on why he hasn’t started accepting bitcoin yet.I hope Elon will have a chat with Michael Saylor (Chairman of Microstrategy, the largest corporate holder of Bitcoin and also an instrumental figure in the Bitcoin Mining Council) soon!

So Elon, what are you waiting for?

What is Counterfeit money?

Posted on by
Reply

Former Chairman of the Federal Reserve Alan Greenspan explains how the United States can pay down the debt. By printing money. Transcript:

David Gregory, moderator of “Meet The Press” on NBC: “Are U.S. treasury bonds still safe to invest in?”

Alan Greenspan, Former Chairman of the Federal Reserve: “Very much so. This is not an issue of credit rating, the United States can pay any debt it has because we can always print money to do that. So, there is zero probability of default.”

If I were to print new money it would be counterfeiting, which is illegal in the USA, and every other country in the world. When the US government creates new money it is not counterfeiting. The action and result is exactly the same, there are more dollars in circulation, except in magnitude. If I were to print new money it’d be maybe $1 million? When the government creates new money it is $1 trillion! Every year! What’s the difference? Every new dollar decreases the purchasing power of every dollar that currently exists. Why do we put up with this?

1% Allocation to Bitcoin – An Asymmetric Bet

Posted on by
Reply

Bitcoin represents an asymmetric bet. It is one of the few assets that has the potential to 50x.

I think it’s smart to invest 1% of your net worth into bitcoin. If you have $100k in investable assets in your 401k or bank account, you could consider buying $1,000 worth of Bitcoin. With Bitcoin costing $29,749.64 for 1 bitcoin as I’m writing this $1,000 would get you 0.03302561. If bitcoin was to hit $100k that’d be worth $3,302. If Bitcoin goes to $1 million/coin you’d have $33,025.

Once you accumulate a higher net worth you can actually bet a larger amount to bitcoin, say 2%-5%. The reason is you have the safety of your core position of assets in case your asymmetric bet goes poorly. If your core position is $500k and you invest $5k or even $10k, in the chance your asymmetric bet goes to $0 you still have $490k in your core position, which is still a strong position to be in. 

Nassim Nicholas Taleb shares the concept of asymmetric bets. Safe/low risk positions in your investments act as an anchor while as well as big/high risk investments give you the opportunity to “hit it big”. Bitcoin would fall into this big payoff/high risk category. 


But as noted, if you have a very safe base of index funds as your safe/low risk position, it might make sense to take some risk, but only with what you are willing to lose! Most people think they are willing to take more risk than they actually are. Once a position drops 50% people often sell. You need to consider what you will do if your asymmetric bet drops 50% BEFORE it happens. If your answer is “sell” the asymmetric bet probably wasn’t something you should have done in the first place!. If the answer is buy, and you are sure you will do that, perhaps you should consider the asymmetric bet. Personally this is the position I was in all of 2022. I was buying bitcoin all the way from $60k down to $15k. It is now at $29k and I am just a little in the green, but at the start of 2023 I was 50% in the negative on my bitcoin holdings!

The majority of my personal portfolio is invested in safe index funds. But I do have 2 potential asymmetric bets with a smaller portion of my portfolio, Tesla and Bitcoin. 

If you’d like to learn more about bitcoin you can read plenty of my posts. 

Nobody Wants to Buy Bitcoin… Yet

Bitcoin Vs. Cryptocurrencies

What Problem Does Bitcoin Solve?

KPMG – The Bitcoin Narrative is Changing

Silver – Buying and Premiums

Posted on by
Reply

I bought my first silver 1 oz coin just over a year ago. I ended up paying $24.25 from a local coin shop. At the time the silver spot price was $19.43. This means I paid a premium of $4.82 or 24.81%. This was actually the lowest premium I paid for quite a while until November 2022 when I found some sales on www.SDBullion.com. 

By that time the silver spot price had risen to $21.43 and I paid $25.97 or $4.54 premium which was a 21% premium. The high premiums were partially because these were on sale. I was paying these 20%+ premiums because the stock market was doing poorly and people were selling out of stocks and buying into precious metals because they were seen as safe. 

Today, the stock market has been roaring, most of the year. The S&P 500 is up 17% this year as I am writing this. When the stock market is going up, people often sell gold and silver, and bonds, and buy into the stock market. 


When people aren’t interested in something is when you should consider buying it, if you are going to. 

The best deal I found was these 1 oz Golden State mint generic silver coins. The silver spot price was 22.84 and they were selling for a $2 premium, $24.84! Or 8.7% premium. This is just a little more than the first silver I bought over 1 year ago when the spot price was $19.43 or $3.41 lower than it is today. $24.84 is also lower than I paid in November 2022!

This is a trend I’ve watched over the last year. The spot price for gold and silver has risen but the premiums have actually fallen more! This makes it possible for you to buy the same amount of silver or gold for less than was possible a year ago, despite the higher spot price. 

The 2 websites I check frequently are https://sdbullion.com/deals . Specifically their “Doc’s deals” page which is linked here. The 2nd is https://monumentmetals.com/deals.html?page=1 Monument Metals – Deals page also. Basically every metals dealer has a “deals” page. And when you are looking for the cheapest premium that is often where it is. 
Other good sites are JM bullion (although usually more expensive) or as mentioned at the start Golden State Mint. 


The deals change weekly. It’s even possible that premiums or spot price continue to go down in the future! Buyer beware!


Read this before considering metals and know why you are buying physical metals, similar to any purchase or investment.