Author Topic: Money/inflation, the Fed, Banking, Monetary Policy, Dollar, BTC, crypto, Gold  (Read 512938 times)

ya

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Though there was unrest in Kazakh, it did not materially affect the BTC hash rate. Infact the hash rate only took a dip when China banned BTC mining, but its now back to normal and higher than before.

https://checkonchain.com/btconchain/performance_hashrate_pricing_usd/performance_hashrate_pricing_usd_light.html

ya

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Small Tonga, looking to make BTC legal tender...the dominoes are falling. Probably nothin

https://twitter.com/LordFusitua/status/1481101011506774016

DougMacG

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Re: Money and inflation, MV = PQ, Scott Grannis
« Reply #1702 on: January 13, 2022, 09:05:43 AM »
Giving this a second look:
https://scottgrannis.blogspot.com/2022/01/the-fed-is-ignoring-demand-for-money.html

I believe Scott is right all the way through academically, and the academics may be his peers, but I don't think such a roundabout way of looking at it advances our ability to simply and directly spell out cause and effect. 

There are two parts; Crafty laid out one of them and the other was obvious to anyone who received thousands in the mail for doing nothing.

**  We inject more and more money into the system without producing more and prices go up.  **

This isn't complicated but there are many follow up points to that. 

Right Way:
There is supply side economics of which Scott Grannis and people here are advocates.  Reduce the burdens of government placed on producers and more people will produce more goods and services, earn more income, buy more goods and services, save more, and invest more in a highly interconnected, dynamic economy.  Everyone benefits right down to the tax collector and the people who rely on the public revenues.  True liberals should favor that, not just small government conservatives.

Wrong way:
Then there is the demand side, magic wand side, denial of incentive-based economic science side of it that is the Democrats.

Stimulus checks, quantitative easing, Universal Basic Income UBI, Modern Monetary Theory MMT, free lunch, free health care, free Obama phone, Keynsianism (run amok), borrow more, spend more, owe more and more debt, NONE OF IT TIED TO PRODUCING MORE GOODS AND SERVICES.

More money in people's pockets but not more goods and services = inflation.  Who knew?  I don't know, everyone?  It's definitional.
« Last Edit: January 13, 2022, 09:14:34 AM by DougMacG »

ya

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Fidelity "History has shown capital flows to where it is treated best and embracing innovation leads to more wealth and prosperity. We also think there is very high stakes game theory at play here, whereby if bitcoin adoption increases, the countries that secure some bitcoin today will be better off competitively than their peers. Therefore, even if other countries do not believe in the investment thesis or adoption of bitcoin, they will be forced to acquire some as a form of insurance. In other words, a small cost can be paid today as a hedge compared to a potentially much larger cost years in the future. We therefore wouldn't be surprised to see other sovereign nation states acquire bitcoin in 2022 and perhaps even see a central bank make an acquisition."

https://www.fidelitydigitalassets.com/articles/2021-trends-impact


ya

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If you like Max Keiser...here's a good interview. As you may know, Max has been pushing BTC since a $ and is now getting out of gold. He is a bit of a showman, but over the last few years, I have come to respect him.

https://youtu.be/VqtGk6St9yk

ya

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ya

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Willy Woo

Top level summary for 16th Jan 2022 (current price $43.0k):

Macro structure: Long term holders continue to have most of the coins, they are at peak accumulation levels, they’ve also halted their profit-taking which was seen in October and December. Given so many coins are locked up with long term holders who do not sell until profit is at hand, this is indicative of a bullish year for 2022.

Medium term (up to 3 months): In terms of coin movements, the picture is very quiet and neutral. Whale investors sold down in October peaking in December, this is now abating and swinging towards a buy zone (but we are not quite there). The expected January redeployment of capital by institutions has not yet happened.

Short term (next 4 weeks): The sell-off trend has not yet ended. Exchange data indicates short term and long term speculators have been selling off. We are waiting for demand to come in. Short term on-chain signals shows the market is oversold from fundamental valuation.

ETH and Alt commentary: ETH is showing early signs of on-chain demand. While BTC is trapped in a prolonged sideway regime this is typically a zone where alt-coins perform and indeed they are starting show strength. A mini alt-season is forming.

Structural comments: BTC is broadly in a sideways accumulation zone with low spot volumes relative to futures markets where most of the short term speculation takes place. During these phases of the market, similar to 2019-2020, the predominant force behind price action is correlations to risk-on / risk-off in equity markets. Futures data becomes dominant for the short term while on-chain analysis is best used to peer into the macro structure. On-chain data for short timeframe calls will have to wait until until spot volumes increase relative to futures.

ya

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Being a hodler was never easy..


Crafty_Dog

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WSJ: Congress treats Bitcoin like stacks of cash
« Reply #1709 on: January 18, 2022, 02:08:36 AM »
Congress Treats Bitcoin Like Stacks of Cash
A new federal law mandates reporting transactions of more than $10,000. Why?
By Abraham Sutherland
Jan. 17, 2022 5:23 pm ET



Without fanfare or debate, Congress has recently determined that economically meaningful transfers of digital assets should be as rare, burdensome and criminally suspect as transacting in bricks of cash. An eight-word amendment to the U.S. tax code in the infrastructure spending bill, which become law on Nov. 15, defines digital assets as cash for the first time—a small change with bad consequences for American innovation.

Enacted in 1984, Section 6050I of the tax code mandates onerous reporting when businesses receive more than $10,000 in physical currency. This discourages the use of cash and encourages the use of banks, which since 1970 have been tasked with surveillance and reporting of Americans’ transactions for tax-enforcement and other crime-fighting purposes.

But Section 6050I is obscure for a reason: In 1984 cash was already obsolete for economically significant, law-abiding use in the modern economy. So no one except criminals cared when Congress created one more reason to use banks instead of cash.

But Bitcoin and digital assets aren’t obsolete. The November amendment will thwart development of this new technology and effectively ban many uses of digital assets. It will push innovation out of the U.S. And it will entrench existing financial institutions and big tech at the same time it forces Americans to report one another or face a felony charge.


The new law also creates inconsistencies with other federal law. Section 6050I interacts with provisions of the Bank Secrecy Act in nuanced ways that the amendment didn’t consider. These should have been understood before Congress legislated on such an important technology.


The provision is also constitutionally suspect. Section 6050I forces businesses to collect, verify and report customers’ names, addresses, Social Security numbers and other personal information without a warrant. This is a significant imposition on privacy rights and will rightly be challenged under the Fourth Amendment.

Unfortunately, there’s no quick fix through artful Treasury Department regulations. The statute limits the discretion of regulators, and the statute itself establishes the surveillance and reporting requirements.

Some in Congress understand this is important, and bills were immediately introduced to repeal the hasty, never-debated amendment.

One of them, introduced by Reps. Patrick McHenry (R., N.C.) and Tim Ryan (D., Ohio), has a dozen bipartisan cosponsors and, among other fixes, would replace the 6050I amendment with a study and report to Congress.

That’s the right approach. Section 6050I was originally written for face-to-face transfers of untraceable physical objects occurring on American soil. But digital assets aren’t simply digital cash. Unlike physical cash, digital assets are highly traceable. And digital assets aren’t obsolete.

After years of silence, Congress’s first important foray into digital-asset legislation was done on the sly and without considering the consequences. For those who understand neither 6050I nor digital assets, the grave consequences of the new law aren’t obvious, but they are real. The mistake can be rectified. Congress should repeal the Section 6050I amendment and start over.

Mr. Sutherland is a fellow at Coin Center and an adjunct professor at the University of Virginia School of Law

ya

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What a difference a year makes, measured at BTC 40,000 $...note the dates




ya

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GBTC premium is at neg 25 %. It is selling at a 25 % discount to BTC. Great buy.

I prefer to buy BTC direct, simply because one does not suffer through a neg.premium.


ya

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Intel to start making ASIC chips. This news is important because 1. International game theory is coming into play. Currently almost all mining equipment is of Chinese origin, western nation states will likely not want to be hostage to China wrt ASIC miners. https://www.btctimes.com/news/intel-bitcoin-mining-announcement-first-customer
2. Nations who get in on the action first will benefit, not many large countries will admit to accumulating BTC. Jason Lowery from the US Space Force compares BTC mining to Military Force. Worth reading about his ideas.
3. The fact that INTC is making mining chips (i.e. spending hundreds of millions), means that the US will accept BTC and it will co-exist. Too many politicians hold BTC, SEC Chair Gensler is favourable to BTC, J Powell is not against BTC.

We only need time, before everyone gets it!.


ya

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This is why BTC is the best choice, its software has been reviewed by the best cryptographers for over 13 years now. Any changes to the software takes years to implement and painstaking review.

ccp

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elites and big banks
« Reply #1716 on: January 21, 2022, 03:44:17 PM »
trying to muscle out cryptos:

https://www.msn.com/en-us/money/markets/the-federal-reserve-is-taking-the-next-step-toward-possibly-launching-a-digital-dollar/ar-AASZ8Vk?ocid=uxbndlbing

no surprise
they won't allow control of crypto dollars to anyone else.......


ya

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A great read by Sven. There may still be some pain to come for BTC, but he is becoming a long term investor.

https://northmantrader.com/2022/01/22/revolution/

ya

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Bitcoin is dead. 400 Obituaries, they must be right

https://www.bitcoinisdead.org/




Crafty_Dog

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We have been postulating that BTC/ETH were replacing gold.  Now that they are going down sharply, is it a coincidence that gold is going up?

G M

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We have been postulating that BTC/ETH were replacing gold.  Now that they are going down sharply, is it a coincidence that gold is going up?

I would think it’s not a coincidence.

ya

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Crafty_Dog

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With great sincerity, your hand holding is greatly appreciated-- gratitude!

ya

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Anyone who has held BTC for 4 years (1 cycle) has been well rewarded, that's the minimum hold, holding for 2 halving cycles is what most will do.

Remember what you expect is different from how BTC moves (different from any stock), which is the reason we hodl.


ya

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Its important to understand this figure. By 2024 at the next halving, 94 % of all BTC will have been mined. After that (mid 2024) the supply of new BTC will reduce 50 % from 6.25 BTC/10 min to 3.125 BTC/10 min and then further about 1.5 BTC/10 min at the next halving etc. Essentially the last 5 % of BTC will be mined over the next 100 years in smaller and smaller quantities. In other words, there is literally no significant new supply coming into the market, once 95 % of all BTC have been mined.

We all know what happens when supply is miniscule and demand is massive. Retail investors, large funds, companies and nation states will all want their share.


ya

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This is why, people need to hold their coins off exchange. The BTC block chain has never been hacked.

https://www.btctimes.com/news/millions-stolen-from-crypto-com-in-hack

ya

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Nice movie to watch...hope everyone is aware of Klaus Schwab, WEF and the Great Reset

https://www.thegreatresetfilm.com/

ya

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BTW, with markets and BTC dipping, the BTC miners have dipped even more (they also go up more). Pl. do your own research, but I own BITF, HIVE, HUT and RIOT is building huge capacity, so it will go up soon. Infact, I added to my stack. I will sell when they triple.

G M

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Nice movie to watch...hope everyone is aware of Klaus Schwab, WEF and the Great Reset

https://www.thegreatresetfilm.com/

Important!


ya

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This ZH article makes several important points. Holding for the long term is key.

https://www.zerohedge.com/crypto/all-possible-fed-policy-tracks-still-lead-bitcoin

ya

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From Willy Woo
Top level summary for 24th Jan 2022 (current price $34.9k):

Price action environment: We in a prolonged re-accumulation phase of the market, akin to mid-2019 to late-2020. Typically in these situations BTC trades in a strong correlation to equities with little adherence to on-chain data. The environment has been risk-off in equities and this has been the key contributor to BTC’s weak performance. Traders are currently leading spot investors tracked by on-chain data.

We are seeing early signs of demand seeping back into the market in futures markets, and the chart technicals points to today as being a high probability zone for a reversal. If this level holds we can expect a solid bounce.

The strength of the sell down has not been supported by fundamentals of investor movements.

Whales (owners of 1000BTC of more) sold down in November and December, this has now switched back to accumulation. This may be the early signs of the expected redeployment of institutional money.

Price in relation to on-chain demand is now nearing peak oversold levels. All previous times in this zone we have experience very strong and prolonged bounces, the last time we saw this was at the $29k bottom in July 2021, also the Oct 2020 rally from $10k to $60k started in a similar structure.



ccp

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G M

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Sooner rather than later
« Reply #1737 on: January 26, 2022, 04:33:20 PM »

ya

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Putin wants to get in on the action. Kicking Russia out of SWIFT would certainly do it. They have plenty of gas, cold climate and far flung places with hydropower, ideal for local mining. Buying El Salv. Volcano bonds next month, would also send a strong message to the US.

https://www.bloomberg.com/news/articles/2022-01-27/putin-backs-crypto-mining-despite-bank-of-russia-s-hard-line

Crafty_Dog

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I see gold has dropped $30 this morning and is back to $1800.

Crafty_Dog

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The Kraken Intelligence team has analysed on-chain data for bitcoin and ethereum.
Certain indicators are key to determining whether the bull run will resume in the near future or not.
The Federal Reserve is having a bigger impact on crypto markets now than it has done in the past.
Bitcoin has roughly halved in value from its $69,000 peak in November to sit at around $35,000 as January draws to a close.

This precipitous fall for the original crypto and many others is nothing out of the ordinary for the most volatile of asset classes, but it has still shaken confidence amongst investors and there are plenty of people proclaiming it is the start of a long
bear market
.

This is far from a unanimous view though, with some experts seeing recent market movements as just the inevitable short-term period of profit-taking that follows a strong run up in prices. After all, bitcoin is still up almost 1,000% over the last three years, despite the slide from November's all-time high.

Something else to be mindful of is that crypto has begun trading with a much closer correlation to tech stocks than in the past, and therefore is being impacted by interest rate rise expectations. 

Prices have stabilized over the past week and determining whether the dip is bottoming out or if there's another big fall coming is the key question all crypto investors are wrestling with.

One of the world's biggest crypto exchanges, Kraken, has a team of analysts dedicated to finding answers to questions such as this.

In a research note from the Kraken Intelligence team dubbed "On-chain digest" the analysts described the status of the crypto market as "hodlers' last chance."

"Market participants contend that the latest market weakness stems from increased concerns of hawkish policy from the
Federal Reserve
," the Kraken team said. "Though prices have been falling since November, the drop didn't accelerate until the release of the Federal Open Market Committee (FOMC) meeting minutes on December 14 to December 15, 2021."

The meeting contained hints that an accelerated pace of tapering, interest rate hikes, and potential quantitative tightening to lighten the central bank's balance sheet was coming. While the Fed's hawkish tone has some convinced that a bear market may be ahead, it's crucial to observe on-chain data to paint a complete picture of the crypto markets and where they are heading."

There are four major on-chain data points the team is watching like a hawk. 

HODL waves
These reflect the percentage of bitcoin's circulating supply that hasn't moved wallets over a specific timeframe.

When plotted against bitcoin's price it shows which market participants — long-term, medium-term, or short-term holders — may be fuelling selling pressure. There are three main categories. "Ancient or lost coins" that haven't moved for over five years, "old coins' that haven't moved for over 6 months and "young coins" which has only been static for 6 months or less.

"BTC's HODL waves show that long-term holders have been accumulating coins since April 2021 and may have begun taking profits during November 2021," the Kraken team said.

"From April 30, 2021, to November 24, 2021, young coins rapidly shifted into the long-term holdings category. While long-term holding conviction appears stronger than ever, network activity shows that both Bitcoin and Ethereum are seeing less on-chain demand," they added.

Network Activity
This refers to the number of people active on a blockchain and is measured by the numbers of bitcoin or ether addresses that are actively transacting on the blockchain.

"In addition to a reduction in long-term holding behavior, on-chain data shows that network activity for both Bitcoin and Ethereum fell month-over-month, evidenced by the drop in monthly active addresses," Kraken's team said. "Since early November 2021, Bitcoin's number of monthly active on-chain addresses has fallen meaningfully, ending a 3-month uptrend."

SOPR and MVRV
The SOPR is the spent output profit ratio. The SOPR measures whether market participants are selling at a profit or loss. It is calculated by taking a spent output and dividing its realized dollar value by its dollar value at creation.

MVRV is ether's market value to realized value. The MVRV Z-Score compares the difference between a cryptoasset's
market cap
 and its realized value relative to the standard deviation of its market cap.

"While long-term holding conviction and network activity are slowing, on-chain indicators such as BTC's SOPR and ETH's MVRV Z-score suggest that the broader macro trend isn't necessarily over yet," Kraken's team said.

"Though BTC's SOPR shows that market participants are mainly selling at a loss, the situation was much worse during bitcoin's latest retracement from $65,000 to $30,000 from May 2021 to July 2021 after which the market made a strong comeback."

"The crypto market is currently going through another test amidst broader macroeconomic uncertainty relating to global interest rate policy and repricing of risk-on assets," added Thomas Perfumo, Kraken's head of business operations and strategy.

"More than ever, this market environment highlights the importance of on-chain fundamentals, which is the focus of our report. In particular, we highlight signals that indicate investor sentiment in crypto markets is greater than when markets briefly turned over eight months ago. Long-term confidence in the prospects of both assets has not disappeared as some might argue."

Check out: Personal Finance Insider's picks for best cryptocurrency exchanges

KEEP READ

ya

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Sir, after the volatility, we all need some hopium.


Crafty_Dog

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Could this have something to do with the rout?
« Reply #1742 on: January 28, 2022, 07:20:26 PM »
https://www.bizjournals.com/jacksonville/news/2022/01/28/cryptocurrency-florida.html?fbclid=IwAR2LOLsQNOVKIbQJ4wxUGm8GaVOW1HSr4M2zd3uielMr9NUW8CDNqAQYYw8

By Gray Rohrer – Florida Politics
Jan 28, 2022 Updated 5 hours ago
Legislation to define the term “virtual currency” and attempt to clarify state law regarding cryptocurrency and state financial regulations passed through the Senate Subcommittee on Agriculture, Environment and General Government on Wednesday.

The bill’s movement is an indication the bill has a greater chance at passing this year after failing to get through the Senate last year.

“It’s largely uncontemplated in law since it’s so new,” said Sen. Jason Brodeur, a Lake Mary Republican and sponsor of SB 486. “(The bill) lays some guardrails down for how we will deal with cryptocurrency.”

The bill defines “virtual currency” as a “medium of exchange in electronic or digital format which is not currency.” Brodeur and the committee also amended the bill to ensure the term doesn’t apply to currencies solely used in online gaming platforms or a business’ exclusive rewards programs that can’t be converted into hard cash.

The measure passed unanimously with little discussion and has just one more committee stop in the Senate before making it to the floor. Last year, a similar bill passed through the House but failed in the Senate. This year’s House version (HB 273) has passed through its two committee references and is headed to the House floor.

Brodeur cited a decision by the Third District Court of Appeal in Florida v. Espinoza, which held that selling Bitcoin to another person was covered under the state’s laws governing money transfers. That decision was issued on Jan. 30, 2019.

“I think it was prompted by the Office of Financial Regulation wanting to have greater guardrails after the Espinoza case,” Brodeur said of the bill. “That was a seminal case law that really highlighted the need to have better definitions in the money service business section of Florida law.”

“Definitionally with digital currency, we have to delineate between a private person who is a money service provider, versus somebody who is just trading their own currency,” he added.

The bill is a reflection of the increased interest in cryptocurrency by Florida officials in recent years.

In his budget recommendations to lawmakers issued in December, Gov. Ron DeSantis called for the creation of pilot programs at a few state agencies to accept cryptocurrency as payment for select services, and for businesses to pay state fees.

Those suggestions aren’t in the bill, but the state could — and will likely have to — accommodate cryptocurrency in the future, Brodeur said.


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“That will be a decision as use of these instruments picks up,” Brodeur said. “Right now it’s not widespread, but we have to be ready for it in case it is. The intent of this bill is to put guidelines in place so that as we have cases of illicit use as a money laundering thing … we are familiar with what is actually money laundering from a money services business and what’s some guy just trying to trade his Bitcoin.”

ya

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Texas challenger for Governors seat plans to make BTC legal tender, current Gov. of Texas is also a strong BTC supporter, in AZ a bill introduced to make BTC legal tender. While these may not go anywhere, the discussion will ensue. BTC genie cannot be put back into the bottle.


Crafty_Dog

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Coinbase's new User Agreement
« Reply #1745 on: January 29, 2022, 11:21:51 AM »
Second post

https://www.coinbase.com/legal/user_agreement/united_states_jan_2022

Our attention is called to Section 7 and Appendix 5 in particular




ya

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Willy Woo:

Top level summary for 30th Jan 2022 (current price $37.6k):

Short Term: The sell down by traders which lead to hodlers to follow suit has now stopped. Traders on futures exchanges have recently stopped their sell down while on-chain we can see that hodlers are now buying alongside medium term speculative investors.

Price is now at extreme discounted levels compared to on-chain demand.

Whales (owners of 1000BTC of more) are now in strong accumulation, signs that institutional money is now re-entering the market.