Bitcoin and Crypto Thread

[chance vought]

And what about when you get to the point where you have a decent Bitcoin bag and want to retire off your Bitcoin?

Borrowing against your Bitcoin is very pricey currently interest rates are 10
- 15% depending on the lender.

Still not a bad deal if you can beat that 15% cost - by buying more bitcoin. Finance your life for $100k. Borrow $200k and use the extra to buy more bitcoin. When the loan comes due, borrow against the bitcoin you bought with the loan to pay off the old loan, and get another $100k to finance your life, rinse and repeat. This works as long as fiat is around because if a realistic interest rate were charged for fiat loans, the fiat system would collapse. Saylor strategy.

And lending your Bitcoin carries credit risk and you only get a 2 - 3% yield at most for taking on that risk.

Just don’t.

Selling your Bitcoin can trigger potentially large capital gains taxes.

Yes…even at 15% you should borrow against it, just like real estate. You get the benefit of controlling the asset AND printing more fiat money for yourself, in the form of a loan against it.

My guess is some of these issues will be resolved in the next 3 - 5 years (lower interest rates on Bitcoin loans, higher yield for lending your Bitcoin, capital gains tax free to sell or at least spend a certain amount of Bitcoin, etc).

The spreads are insane in Bitcoin for centralised borrowing and lending on Bitcoin. 2 - 3% for lending your Bitcoin and you pay 10 - 15% to borrow against your Bitcoin. That is a spread of between 7 - 13%. In trad-fi the spread between borrowing and lending for example the spread between a 5 year mortgage and a 5 year term deposit is only typically 2 - 4%. This is an issue which Bitcoin clearly needs to address.

It’s not an issue in my opinion, the math is already heavily in your favor.

I never realized just how powerful fiat debt is in building wealth, but it is like fire: you can use it to cook and heat your home, but you can also burn your house down.

In AUD 15% is a screaming deal I think, your inflation rate is probably close to that.

 

[scorpion]

The opposite is true. Look at companies in the S&P 500. In aggregate they spend more money on stock buybacks than they reinvest into expanding their businesses. And the amount of people who just borrow to buy existing stocks and existing rental properties due to the fiat carry trade (your debt will shrink in real terms due to inflation). The fiat system encourages speculating on financial assets rather than productive investment.

Most of these criticisms (which are valid and I agree with) are due to the gradual corruption of the legislative and regulatory structures in the U.S., which has resulted in a system that encourages rent-seeking and parasitic/exploitative economic behavior. This is what I mean about Bitcoin not being a panacea - to the degree that it actually accomplishes anything of value, it will be coopted by the same malignant actors who have corrupted the current financial system. You even admit yourself that Bitcoin cannot directly facilitate any sort of economic activity, but must at best merely serve as collateral. This entails an intimate connection to the financial system, which allows for its total corruption and eventual control.

There is no such thing as a utopian economic system in a finite world populated by fallen man.

 

[Australia Sucks]

Yes…even at 15% you should borrow against it, just like real estate. You get the benefit of controlling the asset AND printing more fiat money for yourself, in the form of a loan against it.

The other alternative is to buy an ETF like IBIT and then get a margin loan against it. That way you can pay something like 7 - 9% interest rates albeit with the downside of the whole “not your keys not your coins” thing.

 

[Australia Sucks]

In AUD 15% is a screaming deal I think, your inflation rate is probably close to that.

Yes. Not 15% if you look at fake stats like CPI but if you are looking at inflation in a realistic manner then yes it’s currently in that 10 - 15% per annum range.

 

[chance vought]

You don’t think the higher end ledger wallets are good?

If a hardware wallet works with altcoins, its security is compromised for bitcoin, vs a bitcoin only wallet.

 

[chance vought]

The other alternative is to buy an ETF like IBIT and then get a margin loan against it. That way you can pay something like 7 - 9% interest rates albeit with the downside of the whole “not your keys not your coins” thing.

The other downside of which is the .25% management fees…and like you said counterparty risk - and capital gains if you ever need to get out, until in-kind redemptions become demanded by the market.

I don’t really worry about ETF security from the custodian, but mainly from government. Also seizable by the legal system, lawsuits, divorce, etc. High risk for not much gain vs self custody.

 

[PurpleUrkel]

You are confused...

You are missing the point...

Bruh, tea calling kettle black. You seem to be neck deep in The Matrix with a life "invested" in understanding money and making a living by not building anything of physical value with your hands, but by pushing paper with your mind via JQ Antichrist financial techniques and philosophies. You admittedly are in your 30's and live with your parents to save money even though you're a millionaire. Full on crypto jew confirmed. Crypto is part of the JQ cashless society agenda, so it's no wonder you believe in it so passionately (yet deny Christ) and spend so much time trying to capitalize on such a confusing jew asset that is purely speculative in nature, so much so, that when you get to the root of what BTC actually is, it can best be surmised as, "a jewish gambling cult."

"Watch out! Be on your guard against all kinds of greed; life does not consist in an abundance of possessions." Luke 12:13

 

[JayR]

Bruh, tea calling kettle black. You seem to be neck deep in The Matrix with a life "invested" in understanding money and making a living by not building anything of physical value with your hands, but by pushing paper with your mind via JQ Antichrist financial techniques and philosophies. You admittedly are in your 30's and live with your parents to save money even though you're a millionaire. Full on crypto jew confirmed. Crypto is part of the JQ cashless society agenda, so it's no wonder you believe in it so passionately (yet deny Christ) and spend so much time trying to capitalize on such a confusing jew asset that is purely speculative in nature, so much so, that when you get to the root of what BTC actually is, it can best be surmised as, "a jewish gambling cult."

"Watch out! Be on your guard against all kinds of greed; life does not consist in an abundance of possessions." Luke 12:13

 

[chance vought]

The other alternative is to buy an ETF like IBIT and then get a margin loan against it. That way you can pay something like 7 - 9% interest rates albeit with the downside of the whole “not your keys not your coins” thing.

A better alternative to margin on the ETF would be loans on MSTR. Higher growth and similar risk to the ETF. Just like bitcoin, study MSTR to know what they are doing before investing. I suggest the MSTR True North on YT or especially the Q1 2025 shareholder earnings call.

 

[Australia Sucks]

A better alternative to margin on the ETF would be loans on MSTR. Higher growth and similar risk to the ETF. Just like bitcoin, study MSTR to know what they are doing before investing. I suggest the MSTR True North on YT or especially the Q1 2025 shareholder earnings call.

I like MSTR I just think its not a good time in the cycle to buy it. You don't want to buy to close to the end of a bitcoin bull cycle because the NAV doesn't have enough time to grow into the price you pay before bitcoin tanks. MSTR is currently trading around 1.7x its Net Asset Value. It would likely take 2 - 3 years for the Net Asset Value per share to catch up to the current price. Meanwhile Bitcoin likely has 6 - 12 months left in its current bull run before a bear market starts. So Bitcoin price will tank and take MSTR down with it before the NAV reaches the current share price. So you have two options. Buy MSTR and put it in the bottom drawer for 5 - 10 years or wait 12 - 18 months and buy it when its depressed during the next Bitcoin bear market.

 

[chance vought]

I like MSTR I just think its not a good time in the cycle to buy it. You don't want to buy to close to the end of a bitcoin bull cycle because the NAV doesn't have enough time to grow into the price you pay before bitcoin tanks. MSTR is currently trading around 1.7x its Net Asset Value. It would likely take 2 - 3 years for the Net Asset Value per share to catch up to the current price. Meanwhile Bitcoin likely has 6 - 12 months left in its current bull run before a bear market starts. So Bitcoin price will tank and take MSTR down with it before the NAV reaches the current share price. So you have two options. Buy MSTR and put it in the bottom drawer for 5 - 10 years or wait 12 - 18 months and buy it when its depressed during the next Bitcoin bear market.

That is definitely a possibility. Mnav can drop to 1 in a bear market. If the market starts understanding STRK, STRF, STRD, the mnav may not drop to 1 during a bear…especially if there is a constant bid provided by S&P 500 inclusion, or they offer a bond that becomes rated investment grade.

 

[magoo]

 

[Blade Runner]

The entire idea of borrowing and lending Bitcoin is nonsensical. First of all, what are you borrowing Bitcoin for? If you borrow 5 BTC from me, what are you going to do with them? Use them as collateral for a fiat loan that you can actually utilize for a productive economic purpose? Why not just take the loan in fiat to begin with?

You answer your own question here.

Thus the money supply can expand and contract to meet the demands of the real economy.

Until it goes to zero like all fiat. You're funny.

a relative balance exists between the supply of money in the economy and the economic activity it enables.

Your understanding of the fiat monetary system is putrid.

Most of these criticisms (which are valid and I agree with) are due to the gradual corruption of the legislative and regulatory structures in the U.S., which has resulted in a system that encourages rent-seeking and parasitic/exploitative economic behavior.

And here comes the "If they just did it right!" statement trying to justify the very thing that they debase on purpose for their own ends, crushing most constituents over time, laughing all the way to the ... bank. Coincidence? I think not.

Crypto is part of the JQ cashless society agenda,

Are you living in the country, but under a rock? It's always funny that you all don't think that your adversaries on this topic haven't thought of things, including really bad points that you all continue to bring up. The cashless agenda has been with us for our whole lives, my friend. It didn't take BTC, or something like it, to have anything to do with it. If anything, it's a fix to the programmable and money printing agenda, since it can't be programmed and it can't be printed.

Honestly, did you do any research on this or do you just keep repeating things people already know are false? That doesn't do you, or anyone else, any good.

 

[chance vought]

only if its held on an exchange....
no thanks

 

[scorpion]

You answer your own question here.

Until it goes to zero like all fiat. You're funny.

Your understanding of the fiat monetary system is putrid.

None of these are anything approaching a counterargument, two are borderline insults.

Post better, or not at all.

 

[Australia Sucks]

None of these are anything approaching a counterargument, two are borderline insults.

Post better, or not at all.

You keep acting as if the fact that hard money is not flexible in regards to expanding and contracting is a bug and critical flaw of hard money. It is not a bug its a feature. A full hard money standard (such as Bitcoin standard or classical gold standard) limits the amount of deficit spending that governments can do and limits the funding for wars. There is plenty of history you can read that explains this quite well. Fiat exacerbates the boom bust cycle. This is all Austrian economics 101. Go read Murray Rothbard, Ludwig Von Mises, etc. I don't have time to explain the whole history of money, fiat and banking crises in this thread. Notice how under a classical money standard governments were much smaller and deficits were also smaller.

I will once again link the essay written by Warren Buffet's father Howard Buffett.

https://www.fgmr.com/wp-content/uploads/2017/02/Howard-Buffett-explains-sound-money-4-May-1948.pdf

"The taxpayer is completely outmatched in such an unequal contest. Always heretofore he possessed an
equalizer. If government finances weren’t run according to his idea of soundness he had an individual
right to protect himself by obtaining gold.
With a restoration of the gold standard, Congress would have to again resist handouts. That would work
this way. If Congress seemed receptive to reckless spending schemes, depositors’ demands over the
country for gold would soon become serious. That alarm in turn would quickly be reflected in the halls of
Congress. The legislators would learn from the banks back home and from the Treasury officials that
confidence in the Treasury was endangered.
Congress would be forced to confront spending demands with firmness. The gold standard acted as a
silent watchdog to prevent unlimited public spending."

 

[RedLagoon]

You answer your own question here.

Until it goes to zero like all fiat. You're funny.

Your understanding of the fiat monetary system is putrid.

And here comes the "If they just did it right!" statement trying to justify the very thing that they debase on purpose for their own ends, crushing most constituents over time, laughing all the way to the ... bank. Coincidence? I think not.

Are you living in the country, but under a rock? It's always funny that you all don't think that your adversaries on this topic haven't thought of things, including really bad points that you all continue to bring up. The cashless agenda has been with us for our whole lives, my friend. It didn't take BTC, or something like it, to have anything to do with it. If anything, it's a fix to the programmable and money printing agenda, since it can't be programmed and it can't be printed.

Honestly, did you do any research on this or do you just keep repeating things people already know are false? That doesn't do you, or anyone else, any good.

Why or how is crypto so infallible against fiat or holding precious metals exactly?

 

[Australia Sucks]

Why or how is crypto so infallible against fiat or holding precious metals exactly?

The thread is 148 pages so I feel like your question has already been answered multiple times but the basic summary is as follows:

-Bitcoin is not infallible but it is superior to fiat or precious metals

-Fiat as we all know has a potentially unlimited supply and every year a lot more fiat gets created so its a horrible store of value. Also digital fiat is very weak in terms of censorship resistance and de-banking etc. Just ask the Canadian truckers. Although physical cash gets around this problem but still sucks as a store of value.

-Bitcoin is more scarce than fiat and gold and other precious metals due to the absolute supply cap of 21 million Bitcoin built into the code. Bitcoin currently has a lower annual inflation rate (less than 1%) than gold or fiat or silver, etc.

-Bitcoin is very liquid and trades every second of the year as long as the internet is working somewhere in the world. Try selling a bar of physical gold or gold ETF shares at midnight and see how you go.

-Bitcoin has fast settlement (and its 24/7). Bitcoin settlement time is anywhere from 10 minutes to 1 hour depending on the circumstances. This is significantly faster than traditional bank transfers especially when large sums are involved. And for small Bitcoin transactions there are layer 2s like Liquid or Lightning network which are super fast.

-Bitcoin is easily transportable. You can send Bitcoin anywhere in the world and it takes between 10 minutes and 1 hour (or it can be very rapid on layer 2s). It also is easy to circumvent government restrictions with it. Try sending fiat or gold to Iran or Venezuela and you will see how hard it is. But sending Bitcoin to someone in Iran or Venezuela is a cinch. Also try carrying a million dollars of gold bullion in your suitcase next time you fly overseas and see if you manage to get through customs.

-Bitcoin is more censorship resistant than fiat or precious metals.

-Bitcoin is more divisible than fiat or precious metals. Each Bitcoin can be divided into 100 million Satoshis.

-Bitcoin is trust-less and permission-less and doesn't need to be assayed like precious metals or audited like fiat in bank accounts everyone can see the Bitcoin sitting in the wallet address on the blockchain.

 

[chance vought]

Why or how is crypto so infallible against fiat or holding precious metals exactly?

crypto is fiat...its fiat by a "foundation" of early insiders that can then dump worthless tokens on desperate retail gamblers

It is "Ripple Labs" x10,000

I like precious metals, but in a tumultuous fourth turning environment, they are nearly impossible to secure or transport. Even the tried and true prison wallet won't get it across a border.

Now imagine gold that you could store inside your skull...that is bitcoin.

 

[RedLagoon]

Thanks guys.