LMAO. Ludicrous Bitcoin ETF booms

See the latest Australian dollar analysis here:

Macro Afternoon

Let’s make a few things clear if I have not already done so. I have no idea when crypto will cease to will exist, only that it will, given all attempts at private currency always do.

Just about everything I say on this absurd ponzi scheme is for a laugh. That’s the attention that it deserves.

That said if you think you can get in and out before everybody else then here’s your chance with the new BTC ETF:

So far as I can tell it is a derivative (ETF) of a derivative (BTC) of a derivative (USDT) of a derivative (junk Chinese debt) of a derivative (USD), the very same fiat currency it aims to kill by being more stable than it.

But you go, girl.

Houses and Holes
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          • You should check out some of these “defi” products–essentially high yield, often leveraged, fixed income products that fund further crypto speculation. It’s basically wild cat banking. Any material fall in the price of collateral (crypto) and it will unleash an ungodly daisy chain of liquidations. Could be a fun space to watch when the Fed turns off the liquidity taps.

            https://tulip.garden/leverage (several USDbln of triple digit yield leveraged products just on that page, and in a relatively minor blockchain)

    • Strange economicsMEMBER

      Utility theory of investing,
      1% in punts that would change your life with wealth. Losing the 1% doesn’t affect you.

      A few people I met bought bitcoin for the same reason.
      Underneath is nothing, but neither in the housing bubble.

      Then again mass psychology brings us the housing bubble, everyone leveraged 10 times in.

      • Housing bubble is justified by lose monetary policy, immigration, fiscal policy and lack of supply (i.e., supply and demand factors). I’d rather buy a house than BTC when it turns.

    • Strange EconomicsMEMBER

      Yet you put 100$ or 1000$ on horse 5 in race 4.
      Or 10k in venture capital in a startup.

      Its the utility theory of money, for 1% of your assets
      you can afford to lose that, but if the horse wins you go up to another level .

  1. So far as I can tell it is a derivative (ETF) of a derivative (BTC) of a derivative (USDT) of a derivative (junk Chinese debt) of a derivative (USD), the very same fiat currency it aims to kill by being more stable than it.

    I like to think of it as art. But less useful.

    • Serious question. How do you balance the environmental impact of crypto against your previously stated environmental concerns?

      • I watched a few good videos on Youtube that explained how BTC miners were incentivised to leverage renewables mostly due to cost constraints. But also I’m looking at not just the cost of BTC but all this IT infrastructure has an impact. Every Google search has an impact on the Environment.

        https://gerrymcgovern.com/the-environmental-cost-of-search/

        I think over time as more and more energy is sourced from renewables the impact of such things will be minimised, but it’s good to think about them for sure and be mindful of them and look for ways to minimise it. I don’t recall now but I looked at data from existing financial systems owned by Banks in terms of their own networks and carbon impact etc.. so it’s not like BTC is this huge environmental hog, it’s impact is actually quite small in the grand scheme, but that doesn’t make it irrelevant either.

        • Regardless of source its a lot of energy being consumed for speculative investment and speculative mining.

          https://www.forbes.com/advisor/investing/bitcoins-energy-usage-explained/

          To combat this, more and more specialized computers, called rigs, are entering the fray, pouring huge amounts of computational and electrical energy into the ecosystem in the race to be the first to solve Bitcoin math puzzles and get the associated prize. That means even though there may be hundreds of thousands of computers racing to solve the same problem, only one can ultimately receive the Bitcoin honorarium.

          “Of course, this is wasteful in the sense that 99.99% of all the machines that did work just throw away the result since they didn’t win the race,” says Brody. While this process produces a fair and secure result, it also creates a ton of carbon emissions. “I very much doubt [whoever founded] Bitcoin anticipated such enormous success in the future and, consequently, the enormous amounts of power we’re talking about,” says Brody.

          https://qz.com/2023032/how-much-energy-does-bitcoin-use/

          Cambridge estimates that annual BTC energy usage is 84.6 TWh.

          According to Cambridge, 62% of global miners rely on hydropower for at least some of their electricity; 38% use some coal, and about 39% use at least some combination of solar, wind, or geothermal. Altogether, annual global emissions from the network are about equal to the London metro area, according to a March article in the journal Joule. But it’s important to note that these numbers are all informed guesses, based on a lot of assumptions, and liable to fluctuate seasonally and with the price of bitcoin. For example, hydro power is more readily available in China during Sichuan’s rainy season.


          https://techcrunch.com/2021/03/21/the-debate-about-cryptocurrency-and-energy-consumption/

          According to the University of Cambridge’s bitcoin electricity consumption index, bitcoin miners are expected to consume roughly 130 Terawatt-hours of energy (TWh), which is roughly 0.6% of global electricity consumption. This puts the bitcoin economy on par with the carbon dioxide emissions of a small, developing nation like Sri Lanka or Jordan.

      • I suspect SHA-256 and possibly SHA-512 are already broken, rendering the whole thing a nonsense. After all SHA-2 family was published by the NSA back in 2001. How much has computation improved in 20 years?

  2. Australian govt say’s meh. Its so irrelevant to Treasury, RBA, APRA and ASIC they cannot even be bothered writing rules for it. The only one who cares is the ATO taxing profits.

    We dont want any moaning if it blows up and people lose their shirts. Make hay while the coal fired power stations are destroying the planet in search of more BTC vaporware.

  3. We have a new asset class forming in front of us that is currently 1 trillion dollars. Not a billion, not a million, a trillion. It has network growth faster than the internet. I would argue that with such a potentially important asset class we have a duty to actually study the industry. I’m not talking a couple of days watching “BTC is a scam videos” and reading the introduction to Nadibs back paper. With something potentially this large I’m talking several months of reading books, medium articles, listening to pro-crypto podcasts. Personally, I spend at least an hour each day exploring another aspect of the entire space. While people spend their time arguing if BTC is real or not, there are entire communities growing and experimenting in this space. It’s mind-blowing what’s going on.

    By all means, read a few headlines and follow David here. But if you consider yourself intelligently curious spend a couple of months immersed in the space.

    • Yawn. Crypto is the same as me shitting in gold ingot cast and selling is online as an asset class,

      That is literally what it is. Nothing more, nothing less.

      By all means risk your capital if you want but don’t kid yourself that you’re not buying somebody else’s faecal matter.

      • Just from a money management perspective, allocating a little capital to crypto is like buying a call without an expiration date. Yeah, you’ll probably lose most of the premium, but without theta decay and potentially big upside. Why let your (justified) distaste for the thing keep you from taking advantage of that asymmetry?

        I’m not mostly castigating the 2013 version of myself here–you’re just collateral damage, David 😉

    • +1, Crypto now is like the Internet in 1995, the use cases it will provide are not yet fully understood or appreciated.

      • DAO’s, NFT’s, Gamefi, trustless value transfer….

        As I said, go out do a couple of months of positive research. The asset class is so large, so disruptive you should be doing some work.

        Or just sit there doing exactly what others did in 1995. Your choice.

    • J1eyed, spot on. HnH and MB are like pager or fax machine salesmen at the dawn of the internet age.

      In 10 to 20 years, cryptos and all their associated technologies and applications will be like the internet is today – completely ubiquitous.

    • The Wizz of Ozz

      Crypto will be destroyed with in the next 6 mths in the public domain its being used to avoid sanctions for semiconductors weapons drugs pedophiles as soon as USA has its digital currency it will be outlawed maybe there will be digital currency for all trade brought with your country’s digital currency illegal trading of the btc etc will still carry on in the dark Web back to were it came from

      • It’s unclear what commonalities exist between Bitcoin and whatever a Government’s “digital currency” is supposed to be (and how that differs from the existing currency which mostly exists in the digital world).

  4. People question its success yet banks still cant transfer currencies overseas unless it takes at least three days and costs $30.

    • I’m not saying that is not ripe for disruption, Nor that blockchain isn’t the answer. what I am saying is that governments do not allow decentralised currency at scale for the simple reason that if they do then they cease to exist.

      • distributed ledger – a store of values. not a store of value.

        XLM have quite the cross country transfer network set up. price is still erratic, not related to the volume of money transferred, and it functions just as well at 6c as 60c.. go figure.

      • Gold is not fiat.

        Bitcoin just like gold will be controlled by fiat.

        Governments can simply print fiat for ever to short bitcoin just like they do with the forever fake gold market.

        Unlike gold, bitcoin is audited and auditable.

        Ever heard of a legit audit of fort knox or the LBMA vaults? Nope. Because the dont exist.

    • I am setting up a company providing IT services. These IT services are provided by contractors who work for the company for free. In return for this free work the company agrees to make weekly donations into a nominated crypto account of your choice.

    • You are talking Australia banks. I can transfer from Singapore to Australia in under 10 minutes at good margins. Like everything else that is big business in Australia, the banks have no incentive to improve the customer outcome when they can just fleece them.

  5. I didn’t realise how much of a bubble this was until I had lunch with a friend who has been investing for a couple of years. Ever heard of NFT’s? He’s literally bought a jpeg image that some bloke has created for $4k, which supposedly is now worth $12k. That is truly frightening

  6. Look at Play to Earn. It will be the biggest trend of the coming year. All those people on UBI and under lockdown will need something to do.

  7. The only ludicrous thing here is CBs pricing money at 0%. That madness is the source of all this other madness going on.

    • Even StevenMEMBER

      CBs pricing money at zero is pretty wild. But even more so is Bitcoin. Or other cryptos. Or NFTs.

      Blind Freddy can see the world is awash with manias, things that go viral, group-think. Bitcoin is an out working of this, notable only because it is larger than most.

      If it’s ever deemed to be a genuine threat to fiat currency it will be crushed by Governments. Advocates of Bitcoin point to this as a strength (“see – it’s IMPORTANT!”). You can’t see how hard I am laughing.

      Like HnH I can’t put a timeframe on Bitcoin’s life (and it could even be perpetual if it stays small enough) but what is it’s value? Who the hell knows. It’s gambling.

      I can’t put a price ceiling on Leonardo Da Vinci paintings either… it only requires a small percentage of people who want it to send it to the moon. Maybe Bitcoin will go to $1m a coin or maybe it will go to close to zero. I think the risk is more skewed towards zero. Enjoy the ride.

  8. You can’t outlaw bitcoin. China has tried, they’ve failed. If China can’t no government can. The idea that a government could shut down btc either physically or indirectly through regulation is wishful thinking at best. Given the big lobbying money that’s now in btc, there’s no chance it will be outlawed in the US.

    Also to all those conflating btc with NFTs and DeFi, chalk and cheese.