How can we get through to people? 19/5/24
One tip on getting through to people
For a lot of people, they’re seeing their cost of living go up so dramatically. Few are able to draw the connection back to fiat currency, central banking. But here’s one way that you could try, courtesy of BigSeanHarris.
It makes perfect sense too when you consider how housing and student loans are all through the roof in recent years. If we lived in a real free market, the cost of these goods should be coming down. But instead of bringing these things down to make them more accessible, we’ve instead seen huge leverage turn these things into bubbles. Housing should not be seen as an investment for most people, it should be thought of as a consumable good, it is something that depreciates over time and needs maintenance.
Property spruikers will rejoinder here that “it’s an investment”, but it’s a bit of a “motte and bailey” argument. Pierre Rochard points how this is over-rationalized here.
Anyway, explaining how and why housing has gone out of reach for everyday people might help you in turn reach those people to understand why Bitcoin Fixes This!
Some news hits:
April’s sell-offs have been offset already by the Bitcoin ETF purchases till 17th May. As of 17/5/2024, Total Global Bitcoin ETFs hold a whopping 973,554 BTC. For context though, GBTC (Grayscale) did come into this process with about 600,000 BTC and they’ve bled out coins while other ETFs have gained.
The US Senate voted to overturn the SEC's SAB 121 which would have made it very difficult for regulated financial institutions to custody Bitcoin. This is remarkable because there were actually some Democrats who voted in a ‘pro-crypto’ direction. However, President Biden did threaten to veto the decision - guess we'll have to wait and see what happens next.
U.S. Representative, Thomas Massie, a Kentucky Congressman, introduces his ‘End the Fed’ bill; as the name suggests, “Americans would be better off if the Federal Reserve did not exist. The Fed devalues our currency by monetizing the debt, causing inflation.”
By signing HB3594 into law, Oklahoma becomes the first State to ‘codify the rights of its citizens to run a node, to mine, and to self-custody their Bitcoin’. This looks a bit like what Parker Lewis was talking about last week, where states may help protect Bitcoin rights against the US federal government. They’re certainly more equipped to fight this battle than individuals alone.
On the tech side, we’re seeing some interest in privacy techniques for Bitcoin such as Silent Payments and PayJoin. Episodes to come on these concepts soon on SLP so keep an eye out for those. On the Silent Payments side we’re seeing wallet support in Silentium and Cake Wallet, and hopefully there is more adoption in other wallets to come. The cool thing here is you could think of it like a ‘bitcoin username’, one thing that you can post up to take donations. Seth made a silent payments site here. The big win here is that it would reduce address re use if widely adopted.
TL; DR of Podcasts over the week:
Bitcoin Mining and Capital Structure with Rapha Zagury SLP574
Swan Mining growth: Swan Mining, led by Rapha Zagury, has seen significant growth, hashing at around 7.5 exahashes and expanding further, attracting investors interested in exposure to Bitcoin with regular cash flows. Swan Managed Mining is for larger institutions investing over $100M in Bitcoin mining that is segregated and dedicated.
Mining pool selection: Rapha pointed out that FPPS isn’t as stable as many people might first believe. There is no free lunch, and pools can be highly variable in terms of actual payouts. This occurs even during high fee scenarios such as the time around halving block 840,000. Maintaining decentralization in block template creation and mining pools is needed for Bitcoin's long-term health and stability. On pool transparency, Rapha noted that in Swan’s experience mining with Ocean, you know exactly what you get.
Bitcoin in investment portfolios: Rapha also discusses Nakamoto’s Gauntlet, a show where he hosted CIOs and others. Interestingly, the Wisconsin Investment Board, a state pension fund hosted on the show about 8 months ago, went on to buy both IBIT and GBTC to the tune of about $160M. And this was recently disclosed publicly and found out through filings. Bitcoin does belong in investment portfolios and some of Rapha’s work is helping show why this is the case. See Nakamotoportfolio.com for more.
Core Scientific Exits Bankruptcy with Adam Sullivan SLP575
Core Scientific's Bankruptcy and Recovery: Some of the mistakes made from the prior cycle were discussed, such as not including hedge products and not diving deeper into the power side of things. The “growth at all costs” mindset from 3 years ago is shifting now and bitcoin miners will have to mature in their outlook and approach.
On mining site decentralisation: Adam noted that even though public bitcoin company mining hashrate has grown, that private mining hashrate has grown even faster. Perhaps the comparatively ‘low hanging fruit’ of large sites has already been taken and now in his view there will be a hunt on for smaller locations.
Industry Evolution and Challenges: The Bitcoin mining industry is now competing with data centers for power resources. Managing costs, capital structures, and efficiency is crucial for success in this competitive landscape. Core Scientific is providing data centre infrastructure for AI and HPC, and the idea is this business will help provide steady overall revenue so that the company can make bitcoin counter cyclical investments. e.g. Bitcoin mining rigs are cheaper during bitcoin bear cycles, so it is advantageous to buy then.
Upcoming conferences:
Bitcoin Seoul May 29-31 in Seoul, South Korea. Discount code for general pass here, and for VIP pass here.
BTC Prague June 13-15th 2024 in Prague, Czech Republic - code LIVERA
Nomad Capitalist Sept 25-28, Kuala Lumpur Malaysia (tickets sold out but wait list possible)
Pacific Bitcoin October 18-19 2024, Los Angeles, California - code LIVERA gets you 21% off