Bitcoin and Crypto Thread

[scorpion]

The illusion is created because actual wealth was stolen, from savers, and given in a concentrated form to the bank, which benefits the most (since it did not have to do anything except an accounting entry), and the borrower (who gets to spend the money first before it is devalued)

wealth is goods and services, not currency

the bank should be able to lend assets that it has (borrowed from people who earned them by producing valuable things)...not create counterfeit currency at the expense of literally everyone else

Please read my post in detail again. You are not understanding the big picture. Don't think of the bank as an individual or a normal company, think of them more like a utility. Like an electric company that provides electricity as a base input to the economy, the bank serves to provide money/liquidity. You say the bank "didn't have to do anything", but you totally ignored my point about the important role banks play by screening for credit risks, thereby helping to ensure that only productive loans (meaning loans likely to create economic value and thus be repaid) are issued. This is not "nothing"; it is an extremely important role in the economy.

You are correct that wealth is goods and services, not currency (not Bitcoin, either). And fiat functions extremely well at promoting the creation of goods and services via the mechanism I outlined above.

There is nothing unfair about a bank creating money at the time it is lended, because the money is subsequently destroyed upon being repaid. In essence, the money never actually existed, it was a fiction that merely served to facilitate the actual economic activity that creates wealth. The money was not real and vanishes, but the economic activity that it enabled is very real and endures.

In actuality, there is no such thing as an objective, universal "money" that exists independently of the economy and retains value in and of itself. Such things do exist, but we call them commodities, not money. Your major hangup is that you continually confuse the role of a commodity (like gold, or Bitcoin, in your view) with a currency. Commodities like gold and Bitcoin can function only very roughly as money in comparison to fiat, because they inherently lack the flexibility of being created and destroyed via the lending process. This is why no modern economy can function on a gold standard, and why Bitcoin is wholly unsuitable for use as a currency.

 

[PurpleUrkel]

wealth is goods and services, not currency

Correct, and bitcoin is a currency. You may not view it that way, but 99% of normies who own bitcoin do. When they count their bitcoin, they count it in US dollars.

You will no doubt say "bitcoin is not a currency, it's a store of value money thing-a-ma-jig!!!", but that does not affect the fact that bitcoin, no matter what you call it, is at 70K US dollars and falling. It has not "stored" anything and as a currency has lost 40% of it's value since last October.

 

[chance vought]

There is a Byzantine process of currency creation (I should stop calling fiat currency money) in order to confuse you.
Sometimes currency is allowed to be removed, but that is always very temporary.
Look around you. Unless you are using bitcoin, life is not getting cheaper, in fact, the opposite.

Nothing I can do about fiat. It’s going away, eventually. You can choose to go down with the ship, or the lifeboat.

Yes currency supply can be reduced over brief periods, but that is as intellectually honest as @PurpleUrkel claiming bitcoin is terrible, because you could sell it for more slave tokens 6 months ago. Yes you can cherry pick 2 data points to justify what you hope is true, but that is textbook confirmation bias, not an intellectual argument.

A select few people can create new money without creating value. The rest of us must create value to survive. That’s slavery.

100% reserve banking still has lending. Lending can exist on a bitcoin standard, at very low interest rates or as equity stakes instead of interest.

 

[scorpion]

There is a Byzantine process of currency creation (I should stop calling fiat currency money) in order to confuse you.

The process of credit money creation is not intentionally byzantine to confuse people, any more than the process of electricity generation and delivery is intentionally made difficult for the average person to understand. Both simply are what they are. The average person is not going to understand the intricacies of the Bitcoin network, either. That isn't a knock against Bitcoin. Complex systems do not need to be easily understood to be valuable, they simply need to function as designed.

Sometimes currency is allowed to be removed, but that is always very temporary.

Sometimes? No, credit money is entirely predicated on coming into existence at the time the debt is issued, and then being extinguished when the debt it paid off. You cannot say that "sometimes" this happens, when it literally happens every time by design. The fiat money supply expands and contracts based on the needs of the economy through the issuance of credit. The only "permanent" new money created is via the interest payments on the debt (which are NOT created at the point of the loan), and which (when managed responsibly on a systemic level) create a slow and steady inflationary pressure on the currency.

Look around you. Unless you are using bitcoin, life is not getting cheaper, in fact, the opposite.

Anyone who owns real assets like stocks, gold and real estate (or tools and classic jeans, shoutout @PurpleUrkel ) has done fine. This is because real assets "float" on the sea of fiat currency and rise steadily over time with the money supply.

Nothing I can do about fiat. It’s going away, eventually. You can choose to go down with the ship, or the lifeboat.

Sure, fiat currencies come and go. That's why I'm not telling anyone to own fiat currencies. I'm telling people to own real assets. Fiat currencies are simply for transacting.

A select few people can create new money without creating value. The rest of us must create value to survive. That’s slavery.

You're completely stuck on the fact that banks "create money", as if they are simply running a printing press and stuffing their own pockets with dollars. I again must point out that banks create money by issuing debt, which must be repaid by the lender. The only way the lender can repay is by engaging in some sort of productive economic activity. In this manner, and in aggregate across the whole of society, the economy is able to grow very quickly by the use of bank-issued credit money. This is not a hypothetical. We know how this works. The money is created by the loan and destroyed by its repayment. What remains is the productive output of the debtor. This is not slavery, it's economic growth.

100% reserve banking still has lending. Lending can exist on a bitcoin standard, at very low interest rates or as equity stakes instead of interest.

Congratulations, you have discovered Islamic banking. Try to imagine the economies of the Middle East without their oil revenues, and you begin to get an idea of how effective Islamic banking is for encouraging economic development.

 

[chance vought]

 

[Blade Runner]

A feature and not a bug. Such flexibility is what makes fiat currency an extremely powerful invention. Since money is itself nothing but a social fiction to facilitate commerce, and has no actual value in and of itself, the ability to create money on demand - and to thereby stem the sort of panics that inevitably emerge when people suddenly start believing that money is scarce and must be hoarded - is a very useful property.

NO no no no no

still doesn't understand panics/crashes happen because of intervention

And yet the vast, overwhelming majority of credit money in our financial system is created by private banks issuing loans, not a state-owned central bank.

All the member banks own shares in the "Fed"

wealth is goods and services, not currency

Yes. You would have thought he would know that by now.

There is nothing unfair about a bank creating money at the time it is lended, because the money is subsequently destroyed upon being repaid.

You still don't understand the Cantillon Effect after hundreds of pages?

It has not "stored" anything and as a currency has lost 40% of it's value since last October.

You still don't understand math?

USD has lost 99% of its purchasing power over the last 100 years. It's funny you don't bring that up. It is going one way, and we know which way, NEVER going up. BTC is going one way, and we know which way, even though volatility is part of its characteristics, currently. Oh yeah, it's going the opposite way of the USD. Deny this and show us again how crazy you are.

 

[chance vought]

Congratulations, you have discovered Islamic banking. Try to imagine the economies of the Middle East without their oil revenues, and you begin to get an idea of how effective Islamic banking is for encouraging economic development.

Not allowed in the US, as full reserve banking would outcompete (and cause the collapse of) fractional reserve banks.

One might expect that those in charge of banking policy in the United States would celebrate the concept of a “narrow bank.” A narrow bank takes deposits and invests only in interest-paying reserves at the Fed. A narrow bank cannot fail unless the US Treasury or Federal Reserve fails. A narrow bank cannot lose money on its assets. It cannot suffer a run. If people want their money back, they can all have it, instantly. A narrow bank needs essentially no asset risk regulation, stress tests, or anything else.

The Safest Bank the Fed Won’t Sanction

A ‘narrow bank’ offers security against financial crises.

www.chicagobooth.edu

Custodia Bank is an example of a bank that accepts deposits and is willing to back up those demand deposits more than one-for-one with reserves. This means that if a run on the bank were ever to occur, Custodia would be able to satisfy all the customer requests. You’d think this would please the Fed, but when the bank applied to become a member of the Federal Reserve System, its application was rejected.

https://www.forbes.com/sites/digital-assets/2023/04/25/custodia-bank-case-highlights-federal-reserve-hypocrisy-toward-crypto/

Slaves don't deserve a safe haven. Consume stuff, and stay dependent on government.

 

[Australia Sucks]

that you are simply wrong, and that societies which are able to properly harness fiat currency and fractional reserve banking (which should be viewed as an invention/form of technology) are able to enjoy greatly accelerated economic growth and development.

I have already addressed this argument before. Why has the GDP growth rate slowed, debt to GDP risen and income inequality and standard of living all deteriorated since 1971 when the last vestiges of the gold standard (the partial gold standard) were removed by president Nicon?

The evidence proves the exact opposite of what you claim.

 

[PurpleUrkel]

I have already addressed this argument before. Why has the GDP growth rate slowed, debt to GDP risen and income inequality and standard of living all deteriorated since 1971 when the last vestiges of the gold standard (the partial gold standard) were removed by president Nicon?

The evidence proves the exact opposite of what you claim.

No, the evidence proves the exact opposite of what you claim, as everyone's standard of living in the world has not deteriorated but increased since 1971.

In 2026 92% of the world's population has electricity, 75% have safe drinking water, and 70+% have access to the Internet (an endless source of job hunting and self-improvement), whereas in 1971 only 50% of the world's population had electricity, only 60% had safe drinking water, and 0% had access to the Internet.

And bitcoin has lost 40% of its value since October.

 

[Australia Sucks]

There is nothing unfair about a bank creating money at the time it is lended, because the money is subsequently destroyed upon being repaid

Except for the fact that there is no money to pay the interest on the loans without creating new money so it’s effectively a Ponzi scheme and as soon as the money supply stops expanding it all comes crashing down hence the current situation of an ever expanding Debt to GDP ratio. How do you think it will eventually end other than collapsing?

 

[Australia Sucks]

No, the evidence proves the exact opposite of what you claim, as everyone's standard of living in the world has not deteriorated but increased since 1971.

In 2026 92% of the world's population has electricity, 75% have safe drinking water, and 70+% have access to the Internet (an endless source of job hunting and self-improvement), whereas in 1971 only 50% of the world's population had electricity, only 60% had safe drinking water, and 0% had access to the Internet.

And bitcoin has lost 40% of its value since October.

You are talking about standard of living rising in third world countries which in general it has but that is the other side of the coin of globalisation where standard of living rises in the poorer countries (due to offshoring, etc) while simultaneously falling in richer countries.

The data shows this:

WTF Happened In 1971?

https://inflationdata.com/articles/2022/08/10/u-s-cumulative-inflation-since-1913/ "I don't believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can't take it violently out of the hands of government, all we can do is by some sly...

wtfhappenedin1971.com

This data is for USA but it’s basically the same story for every first world country:

 

[Australia Sucks]

If you're an honest thinker (and I believe that you are) you should take a step back and seriously ask yourself why, if fiat and fractional reserve banking is so harmful, it is utilized by every advanced economy in the world (including Asian ones that have no history of influence/interaction by Jewish bankers).

Fiat is used by every country in the world because the U.S.A forced it on the whole world. The U.S.A being the most important economy had the reserve currency which was originally partially backed by gold then the USA rug pulled everyone in 1971 under president Nixon and forced the whole world onto a full fiat standard. They basically did not have a choice. The might of the USA military coupled with the trade sanctions etc that the USA can impose causes countries to fall into line or else be punished. Colonel Gaddafi proposed a gold backed dinar Saddam Hussein wanted to start selling oil for Euros instead of dollars and we know what happened to both of them (and their countries).

However this is changing as central banks around the world are feverishly accumulating gold so they can eventually I believe introduce a partially gold backed currency in the future (although it’s possible Bitcoin might get there first).

 

[chance vought]

 

[chance vought]

Except for the fact that there is no money to pay the interest on the loans without creating new money

Let us assume that you pay back your $10,000 loan at the rate of approximately $900 per month and that about $80 of that represents interest. You realize you are hard pressed to make your payments so you decide to take on a part-time job. The bank, on the other hand, is now making $80 profit each month on your loan. Since this amount is classified as income to the bank, it is spendable. So this remains as spendable money in the account of the bank. The decision then is made to have the bank's floors waxed once a week. You respond to the ad in the paper and are hired at $80 per month to do the job. The result is that you earn the money to pay the interest by polishing the bank's floors at night. In other words, you are working for the bank to pay the bank the interest on the money you borrowed from the bank in the first place. And that's the way it is with the entire system.

, the borrower's labor directly flows back to the lender (the bank), making the debtor essentially a servant to the creditor for the "uncreated" interest portion.

the debt-money mechanism turns productive effort into perpetual tribute to the banking system.

 

[chance vought]

However this is changing as central banks around the world are feverishly accumulating gold so they can eventually I believe introduce a partially gold backed currency in the future (although it’s possible Bitcoin might get there first).

the problem with gold is trust - unless the currency is directly convertible into a fixed amount of gold, its just "trust me, bro" If it were convertible to gold, it defeats the entire purpose of fiat money - the ability to invisibly steal the wealth of the currency bagholders.

So no, gold already failed and there will be no gold backed currency. We cant audit Ft. Knox, do you think China would have a public audit?

 

[chance vought]

No, the evidence proves the exact opposite of what you claim, as everyone's standard of living in the world has not deteriorated but increased since 1971.

In 2026 92% of the world's population has electricity, 75% have safe drinking water, and 70+% have access to the Internet (an endless source of job hunting and self-improvement), whereas in 1971 only 50% of the world's population had electricity, only 60% had safe drinking water, and 0% had access to the Internet.

And bitcoin has lost 40% of its value since October.

I agree the world is better off, but that is in spite of fiat, not because of it. Because people are clever, resourceful and intelligent. Imagine the renaissance that will happen when theft is not so easy.

 

[chance vought]

The future of money in the transition period is STRC, or something like it. It is not convertible into BTC - but it is convertible into the currency people want, USD.

STRC dividend payments can easily match or exceed fiat debasement. If money printer go brrrr, BTC rips, and STRC can raise dividends to match. It is bitcoin "backed" but not convertible into bitcoin.

More excess fiat then gets consumed by MSTR and converted to bitcoin. Poor people who can't handle the volatility of bitcoin can still benefit from it, even without directly owning it.

There are an estimated 1 million people who own bitcoin, and that may be the most that ever will. As @PurpleUrkel says, it is hard to understand. The majority of people will never directly own it, only proxys and derivatives.

 

[chance vought]