Bitcoin: the cryptocurrency to take full advantage of true monetary sovereignty

Today’s article will be devoted to this asset, which causes a lot of ink to flow. Unconditionally loved by some, denounced by others as mere speculative bubble, and bitcoin Not finished talking about it. But the current periodgeopolitically or economically, leads to interest in alternative assets which he represents wonderfully.

If you are already convinced of a proposal bitcoinI may not have anything to bring you. If you doubt it, you probably won’t change your mind. But I have at least one thesis Which will explain why I like what he stands for so much and why he is, in my opinion, essential in this environment.

I wish you an excellent read!

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configuration block

Satoshi Nakamoto, the brains behind Bitcoin, created the first transaction block itself. The idea of ​​Bitcoin has been political from the start, even though it is not “straight” or ” Leave “. Anyone who thinks the financial system is problematic can find themselves in the promise of Bitcoin, regardless of their political advantage.

The story is known: V.I The first block of the deal a hexadecimal message.


which when decoded to ASCII gives this.

The hidden message behind a bitcoin transaction

The Times 03/Jan/2009 – The chancellor is on the verge of a second bailout of the banks

Premiere of the time, a reference to the hidden message of Bitcoin on January 3, 2009
Front page of The Times 3 January 2009

It is also interesting to note that its price, which was just £1.50 in 2009, is now £2.50. 66% increase.

Paper newspaper price over the past decade

To get back to this, in French:

The Times 03 / Jan / 2009 – The Finance Minister is preparing to give the banks a second bailout

This message is still relevant. 14 years laterat the time Some banks fall And they, of course bailed out by the government… Just like in 2009, when banks’ inability to properly manage their risks was saved by public money.

The social movement against the financial system in 2011
The social movement against the financial system in 2011 – Source: L’Express

with policies Zero interest rate and the Astronomical valuations for tech startups which often did not turn a profit, the SVB had become Brutal entity. The bank did not speculate in the mortgage market, but adapted to the daily frenzy of the financial markets.

the Huge sums of new money Filed daily with SVB placed in the money market To win at least small fruit. But that was before EDF He decides to climb him rate of altitude to counter inflation. Then they are seated on the banksHuge latent lossesand startups need cash they are looking to recoup, as their previously thriving businesses struggle in this new long-priced environment.

The only currency in the markets was ever higher. Not only were the startups’ valuations unbelievable, but thousands of altcoins, NFTs, Rolexes, Legos,… everything was good to speculate. Cash was the worst investment.

Cryptocurrency industry chaos

Seriously, trying to sell us cryptocurrency reliability after the fall of FTX and LUNA [Terra] ? »

Major events in the crypto ecosystem in 2023
Major crypto ecosystem events, 2023

I hear you shrugging behind your screen. It is true that filecrypto industry It is more versatile breakable of the applicable financial system. Most crypto projects only served VCs (investment capital or investment capital) in order to inject the surplus cash in the period of free money. the words “blockchain”And “decentralization” And “Metaverse” He shone, and that was all it took to convince them. We were literally making money out of nothing.

winners? Twisted Venture Capital. losers? we.

And he needs Bitcoin separated from the majority of crypto projects invested heavily by VCs. It’s completely different: no fundraising and no one representing it, without going to extremes and throwing away everything that happens other than Bitcoin. Ethereum is also a very interesting project, which is fundamentally different. But that is not today’s topic.

As said Robert Schilleran American economist, at the time of the dot-com bubble:

“Nothing significant is built without irrational exuberance.”

“Nothing of significance has ever been built without irrational exuberance.”

This is amazing Irrational exuberance You must pass before feeling the real added value.

Now that confidence in our elites has eroded, with inflation rates around the world in double digits, banks insolvent and inflation still off target? there Paper moneysince the end of the Bretton Woods agreements, is not Guaranteed only to our confidence towards her. Thanks to Bitcoin, we no longer need to trust our bank. But we will return to this point later.

However, one can be disappointed with the promise bitcoin. was introduced as inflation shieldand she is -60% of HUD at the time of inflation. In my opinion, it is simply suffering from the endless monetary expansion and the peak it recorded because of it. Has he failed yet? Not for me. I’Bitcoin ecosystem More alive than ever, the ecosystem remains Most decentralization and inflation Existing. There are no business hours, no CEO, no account bans, no central entity to manage it, and it can be used by everyone, all the time. His promise has been fulfilled so far.

Keeping money in the bank is not without riskBecause you have to trust the banks’ ability to manage their risks. And as history has shown us time and time again, they cannot. With Bitcoin, you can forget about reserves, interest rates, and counterparty risks. There is only a code. He is leaning on himself.

>> Want to be your own bank? Buy a Nano wallet, Ledger offers you up to $30 in BTC as a welcome (trade link) <

CDS on the financial system

It’s an idea developed by financier Greg Foss, who fantasizes Bitcoin as a CDS on the paper money system. I find this example particularly relevant.

For those who don’t know what CDS is, a little reminder: CDS Derivatives that play the role of insurance. They are used to protect against non-payment of debts. We have already talked about it in Article in Journal du Coin in October 2022at a time when Credit Suisse was already in difficulty and when the price of credit default swaps on its debt exploded.

Greg Foss believes that bitcoin should be considered a Reimbursement insurance for all fiat currencies. When the stakes increase for fiat currencies, Bitcoin has a premium. Does this sound crazy to you? Recently, however, searches for Bitcoin have seen an explosion, with SVB and Credit Suisse setbacks.

Comparison of searches for Bitcoin, Credit Suisse, and SVB on Google Trends
Comparison of searches for “Bitcoin”, “Credit Suisse”, and “SVB” – Source: Google Trends

like his price he gained 40% Since the collapse of SVB.

Bitcoin price has gained 40% since the SVB crash
Bitcoin price against the dollar (1D) after the fall of the SVB

the bitcoin It is indeed a defense against the financial system. So it’s kind of a CDS on the latter. But the noticeable difference Bitcoin is it does not contain No consideration.

If you see “short shorts” (which I highly recommend) – a movie where we follow a bunch of winners who speculate about credit swaps during the subprime mortgage crisis – you know the stakes. In 2008, if you had CDS on Lehman Brothers, you made a lot of money. But the counterparty, in other words the person you bought these credit swaps from, still has to pay you.

the bitcoin So it remains Better than CDS Because it has no counterpart (as long as you keep it on a key). It is insurance for the failure of the global system.

This is why I believe the worst allocation you can put into Bitcoin is 0%.

As my former boss (who I salute if he passes here) I like to remember:

“Bitcoin is a Theta-free option.”

understand here: bitcoin that it blanket throughout the financial system There is no time limit. If you leave it in a portfolio that consists of several other assets, it will either have a large upward effect or a small downward effect. You do not have No interest in not keeping it Absolutely.

Projection on the European Central Bank, 2023
Outlook on the European Central Bank, 2023

Your bitcoins have great value and deserve maximum protection! To sleep with peace of mind, prepare yourself with Securing a ledger hardware wallet And get up to $30 in BTC to buy Nano Key. Your security is invaluable (commercial link).

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