2021W45 - WTF has happened in bitcoin this week?
Bitcoin is the only hedge against inflation.
TLDR: Inflation is at its peak, Bitcoin is the proven to be an inflation hedge, Big CEOs are into bitcoin, Countries passing bills to legalize bitcoin, Price seems ready for appreciation.
Hey there niblings, it’s uncle Bam again, with a summary of the most insightful events in the Bitcoin space. Back at it again digesting all the important news for you.
This week has been an incredible one, first Taproot was just activated which is the biggest software implementation on the last years in the bitcoin protocol, incrementing privacy and potentially lowering transaction fees.
The second one, and the one I want to focus the most, is that bitcoin created another benchmark, reaching an all time high of $69,000 on the exact same day the U.S. numbers of inflation were reported. For the first time in 30 years, the CPI (Consumer-Price-Index) increased 6.2%. What does this means? In order to be able to have the same lifestyle without even improving, you pay and your savings should at least rise the same percentage.
The Consumer Price Index, is a measurement provided by the government, where they track the average change in prices paid by urban consumers, basically a way of comparing what the market basket of goods and services cost this month, with what they costed this same month a year ago.
Interestingly, the way of calculating it has been modified over time, and if we bring an alternate calculation, the way it used to be calculated in 1980. The yearly inflation would average over 7.5%, since mid 90’s and instead of 6.2% we would be seeing over 14%.
How is this possible? Well a strong factor the bitcoin community believes in, is that it is a repercussion of debasing our currencies with out monetary policies.
In 2020, over 40% of the American dollars, were created.
Up to November 2021, about 40% of the American dollars were created in the last 12 months.
Basically the issuance of money is not stopping, more money is fighting for the same goods in existence. But then, where is this newly issued money going?
Well, clearly not to our pockets, but we can see a pattern here.
Since 2008, the stock market went from $9T to $54T. It basically grew 600% while the average salaries increased 3% annually, or ~20% in the same 13 years.
It is not possible to compete in a system where the individuals are playing on different rules. And it is also true that we can not insulate ourselves of the effects of other people holding harder money than ours. In a simple way to express the current situation, we are working hard to earn money which an UNelected group can create for free.
A little recap:
40% of the US.Dollars were created.
Stock Market (Stocks and Real estate) has gone up 600% in the last 13 years.
Our salaries have increased ~20% in average the last 13 years
Consumer Price Inflation indicates food and services increase more than 6-14% per year depending on metrics.
How can we save ourselves and loved ones?
Well just by buying bitcoin, which is scarce and its issuance can’t be modified.
How to buy bitcoin?
If you are in Europe, I made a pretty simple guide with 3 steps, which avoids you having to set up an account on an exchange, give them all of your personal information, plus custody of your funds.
With Relai, you send and automate a transaction, to receive bitcoin directly to a wallet ONLY you control, just follow the tutorial if needed.
And this is how the week started.
0. Tim Cook, CEO of Apple says he owns bitcoin.
1. Bitcoin has delivered 99.94% deflation since 2011, officially making it the best performing inflation hedge, according to Bloomberg.
2. Mastercard, the card payment giant, has partnered with Amber Group, Bitkub, and CoinJar to offer bitcoin-linked payment cards across the Asia Pacific region. This will enable users to pay or receive bitcoin in any place where Mastercard is accepted.
3. Atlas, the bitcoin miner, will leverage Luxor's suite of pool services on its under-construction 100 megawatts farm.
4. Bitfarms enters U.S. Bitcoin Mining Market with 24MW Hydropower farm. It will house over 6,000 Bitmain S19j Pro rigs fed by clean energy.
5. Lemon Cash, Argentinian exchange launches Bitcoin Cashback Visa Card. Users can use the Visa card internationally to purchase regular goods with cryptocurrency and receive 2% cashback in BTC.
6. BlockFi files for Spot Bitcoin ETF through a joint venture with Neuberger Berman.
7. Mayor Jayson Stewart discusses his mission of giving bitcoin to all residents of his town.
8. Robinhood, the trading platform, announced in September that they intend to enable bitcoin withdrawals, for which it has now 1.6 million people on its waiting list, expecting to claim their keys and to become their own self sovereign bank.
”Not Your Keys, Not Your Coins”
9. La Haus, a real estate market leader in Latin America will accept bitcoin on-chain and on Lightning for homes through OpenNode.
10. The Premier League club created a new fund with Sportsbet.io's bitcoin donation, with the goal to enhance the experience of its fans.
11. Congolese refugees use bitcoin to build grassroot economy.
12. Russian deputy proposes bill to legalize bitcoin mining.
13. Miami Mayor Francis Suarez announced in a CoinDesk interview that the city of Miami will soon start giving bitcoin to its citizens. His goal is to integrate bitcoin so people would be able to:
Use bitcoin to pay taxes
Hold bitcoin as an investment
Receive bitcoin as salary
CHARTS
Historically, every time bitcoin’s 10WMA (week price moving average) has declined and then made a new high, it has marked the phase of an exponential appreciation move. History does not always repeats itself but it often rhymes.
PlanB shares again his model, which has accurately predicted so far the previous months, that $98,000 is still a possibility this month, but more importantly, the long term future keeps looking brighter and brighter
As a summary note..
If you are new into the space, approach people who have been here longer. It is easy to feel the “Fear of Missing Out”, think it is too late, and feel the urge of compensating by risking current and potential wealth on the cryptocurrency casino. Just remember there is bitcoin, and there is crypto. Bitcoin is sound digital money with unconfiscatable and censorship resistant properties, and it is the big network validated by people and even big tech. Just ask yourself what does the following people have in common?
Elon Musk
Jack Dorsey
Michael Saylor
Steve Wozniak
David Marcus
Tim Cook
They all have bitcoin.
“Bitcoin is the dominant digital monetary network, and because its dominant and fixed it means it’s the most reliable highest integrity scarcest thing in the financial universe. Bitcoin going up forever. “ - Michael Saylor
Stack accordingly.
Have a great weekend niblings.
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