Why Bitcoins / BTC takes bailouts off the table. – David Yomtobian
Shortly after the last economic crisis in 2008 we saw the government bail out all the banks and insurance companies. The inner details of what actually happened will always remain a mystery to all but a few insiders but shortly thereafter On August 18th, 2008 Bitcoin was born. A peer to peer decentralized network that in 2011, it lead to 30 pages of debate. https://bitcointalk.org/?topic=6652.0 Satoshi left the project shortly after because Gavin Andresen visited the CIA who was highly concerned.
The purpose of this short article is not to go into the inner workings of bitcoins but to note one key effect. If the banks start moving their assets into bitcoins which they are already doing all over the world very quietly without anyone noticing any attempt by any government to print more paper and bail them out will only result in a further inflation of the bitcoin price. Bail outs make sense to the extent that you don’t want 20 million people standing outside the worlds largest banks and being told sorry you can not withdraw any money its all gone. This would cause the complete destabilization of society and the world elite would have to deal with chaos. However with the combination of globalization where anyone can leave any country on a days notice and set up shop in a new location + the fact that you can not prevent anyone from holding bitcoin off the grid ( using pen and paper and not using the internet or popular websites like coinbase ). You can bet your life on the fact that a bailout of banks if another collapse or liquidity crisis were to happen will not have the same effect because we are no longer in a single unit closed system of USD without any alternatives. There is a second competing system at play now that did not exist in 2008/2009. Any Bank, Financial Institution, Insurance company, or fund can now turn their paper money into real money through bitcoin and not participate in the paper economy. Imagine there was a monopoly of Yellow Cabs in the city. Well bitcoin is like Uber and no amount of regulation or bailouts will ever make yellow cabs and medallions a viable option going forward.
Pay attention to the news https://www.ccn.com/bitcoin-disrupts-trillion-french-life-insurance/. This is happening and its happening very fast. It wont be long before you will see a host of financial companies offering loans to buy btc with the caveat that they get to “hold” the bitcoins for you until you pay the loan in full. This will further inflate the price to 6 figures, and this is similar to how prices for higher education went up 1000% in the USA because of the lenders jumping in to charge interest on citizens future work by creating debt out of thin air. What you have to watch out for however is that all these holding companies are trying to defeat the entire purpose of Bitcoin in the first place which is the ability of any human on the globe to just write down a set up letters and number on some pieces of paper ( or memorize them ) and not have any of that info sit in another person possession or on the internet. The banks who realize they are the yellow cabs and have been replaced by btc are now buying btc in unthinkable volumes and further trying to use possession of citizens bitcoins as means of holding on to power and growing it for the new economy 2.0 https://bitcoinist.com/german-banks-could-store-bitcoin-and-provide-crypto-services-soon/ and they will soon provide a host of loans to acquire btc which you don’t need to use because you can buy btc in fractions there is no need to own a whole entire bitcoin.
So what does it mean for the big picture now that bailouts wont work at all to stimulate the real economy? It means you should plan ahead and do your research to come up with wealth preservation strategies that are logical but not popular and subject to normalcy bias. What was normal over the last 50 years is no longer relevant and Mark Zuckerberg who is too late to the party with libra project ( which stands for liberation and freedom ) which is being squashed by world leaders understands this to its full extent.
Published at Tue, 28 Jan 2020 19:39:58 +0000
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