Oddbean new post about login | logout I agree with most of what you've said but question a few of your assumptions. Why would taking Coinbases BTC make prices skyrocket? What makes you say they'd sell it? Fort Knox is still loaded with 6102 gold. Why didn't Wall Street or the supreme Court stop FDR in '33? The gold theft wasn't branded as theft. Everyone got $20 an oz for it.
Thanks for the discussion. My imperfect understanding is, FDR seized the gold because the dollar was backed by it at the time, yet citizens were attempting to trade in their dollars for gold during the Great Depression. The govt could not keep up and tried to outlaw private ownership of gold. That kind of prohibition didn’t work and, eventually, the govt recanted.
As for taking the institutions’ Bitcoin, it might have the same effect as the estimated 4 million lost or frozen Bitcoin today. It means that fewer coins are available to trade, as if the 21 million is effectively even far MORE scarce. The sudden increase in scarcity would be a supply shock in the rest of the world.
And NGU, including for enemy HODLRs like Russia, Iran, North Korea, etc. Policies that would enrich our enemies seems highly counter productive to US interests to me and, therefore, unlikely.
Right. So what makes you think they'd sell it off?
The US? If they stole and then HODLed, the supply shock would, logically, skyrocket globally, probably recking many even weaker currencies. That would not be a popular move at all and there would be pressure to sell to pay debts and meet spending without raising taxes. One can imagine campaigns based on the idea. This is entirely speculation of course. The global political economy is a wildly diverse and unpredictable system. But I don’t default to “The Feds are going to steal all the corn and that’s the end of it.” Everything in this inflationary world is good for Bitcoin.