"If the utility in money lies in its ability to coordinate trade, then bitcoin’s value is not merely tied to one’s willingness to save it. It is tied to its ability to coordinate trade and to transfer value between humans.”

Great piece from nostr:npub1w69ya7xs697hk3hky3gllryz8rwverfa0ylz89chf9qnhfcskc2s64zltw

https://graduallythensuddenly.xyz/exchange-theory-of-value/


Real Estate is a $300T market that is propped up by its premium as a monetary asset. As it becomes clear that bitcoin is a superior store of value asset developers, banks and consumers alike will need to incorporate bitcoin in their credit structures.

nostr:naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdej8ycrgvehxycnyvenhx60ym


Over the last four years bitcoin has, among other things, established itself as an incredible corporate treasury asset that benefits those who adopt it as such. Microstrategy is the shining example of this theme going from a company that was hovering barely above a ~$1B market cap in mid-2020 to a ~$40B market cap company holding more than 1% of the 21,000,000 bitcoin that will ever exist. Microstrategy's success has emboldened a number of other publicly trader companies to follow suit. Bitcoin as a corporate treasury asset is well on its way to becoming a standard. If you run a business that doesn't hold bitcoin on its balance sheet you are doing yourself, your customers and your shareholders a disservice.

This is a trend that has its legs under it and will accelerate moving forward. A trend that I believe will emerge this cycle is incorporating bitcoin into real estate markets. Leon Wankum has been beating the drum about this for the last few years and I had the pleasure of sitting down with him this morning to record an episode of TFTC that will be published tomorrow morning. Leon is a real estate developer in Germany and he has made it his mission to educate and warn others in real estate about the demonetization of real estate that is under way due to the fact that bitcoin exists and it provides a far superior alternative.

These are pretty stark numbers. Nothing highlights the superior monetary properties of bitcoin better than looking at a chart of the average price of a home priced in USD v. bitcoin.

Since 2016: +46% in USD -99% in BTC

Since 2020: +34% in USD -70% in BTC

The funny thing is that an overwhelming majority of the individuals who make their living in real estate markets do not understand that this is happening to them. Many think they are doing exceptionally well all things considered. Sure, there may be a bit of a slow down and price retraction due to a couple of years of relatively elevated interest rates, but don't worry! The Fed is lowering rates again and the good times are about to start back up. Nothing could be further from the truth. This trend is going to continue unabated until bitcoin is fully monetized and those is the real estate industry, particularly real estate developers and those who lend capital to developers, should seriously take the time to understand what is happening to them.

Real estate is the largest store of value asset in the world at the moment. The most common number that is thrown around for the total size of the market is $300 TRILLION. $300 TRILLION of wealth being stored in an asset that is illiquid, comes with maintenance costs, taxes, insurance premiums, and susceptible to extreme weather event, among other things. Compared to bitcoin - which is extremely liquid, saleable, divisible and hard to confiscate, real estate is a far superior asset to store your wealth in. This is something that I'm sure is well understood by many of you reading this letter.

What's less understood is the dynamics of the real estate development market over the last few years, which have been severely hindered by elevated interest rates. The higher interest rate environment coupled with the inflationary pressures that forced rates higher in the first place have put developers in a predicament; they have a higher cost of capital to start new projects with raw material prices that are still much higher than they were before the economic lock downs of 2020-2022. This has led to a scenario where it isn't advantageous to start new projects and the projects that broke ground in 2021-2023 are finding that they need to incur more debt to get their developments across the finish line.

Despite the fact that interest rates are on their way back down, it doesn't seem like the economics of these projects are going to materially improve in the short to medium-term as headline inflation begins to creep back up. Couple this with the fact that the jobs market is cratering while real wages struggle to keep up with inflation and many builders are going to find themselves in a situation where they do actually complete a development problem but their cash flow suffers because their customers can't afford the inflated rents that builders will have to charge to get a return on their outlaid capital. Many will be put in a situation where they are forced to be happy with lower rents (cash flow) or sit on the sidelines making no cash flow.

The post-1971 era that brought with it a booming real estate industry is suffering the same fate as the bond market; the generation bull market is over. Real estate prices may go up, but that will be nothing more than a mirage of wealth creation. The unit of account those prices are built on is in dollars, which are being debased at an accelerating rate. Developers, banks and borrowers need to de-risk their real estate exposure and, as Leon points out, bitcoin is the only way to do this in an effective way.

Moving forward developers will have to finance by dual collateralizing their debt with the real estate and bitcoin. In the graphic below Leon illustrates what this type of financing structure will look like. Instead of taking $10m of debt to finance a project and putting it all into materials, construction and marketing, a developer will take out a $10m loan, put $1m in bitcoin and the rest toward the development project. Over the course of the construction of the real estate project, bitcoin will sit in the credit structure and, if held for 4+ years, should increase significantly in value. Saving the builder from risk of default and providing him some optionality in terms of what he can do with the project once it's finished.

In this scenario downside risk is contained - a developer isn't pouring all of the cash into bitcoin at the beginning so the worst case scenario is that bitcoin goes to zero (highly unlikely) and they can eat the small loss and hope to make up with it via cash flows once a project is finished, while upside potential is enormous. Bitcoin is still monetizing and having exposure to the hardest monetary asset the world has ever while it's monetizing has proven to be massively beneficial.

We are still in the early days of bitcoin and this idea will likely seem absolutely insane to most Tradfi investors, but I strongly believe that developers, banks and end consumers who don't leverage this type of bitcoin structured credit will be cooked in the long-run. And those that take advantage of this type of structure first will be considered geniuses in 20 years.

There are many more nuanced benefits to this strategy; holding bitcoin allows landlords and management companies to weather ongoing maintenance costs throughout the years, those who take out mortgages dual collateralized with a house and bitcoin not only protect the equity value of their property but could see their equity values increase significantly more than others using vanilla mortgages, and builders who accumulate bitcoin in their treasuries will be able to use better raw materials when building, which leads to more valuable properties that cash flow for longer.

Again, it's going to take time for these types of structures to become commonplace in the market, but I firmly believe this cycle will be the cycle that these strategies get off the ground. In four to five years they will have a track record and after that it will be considered irresponsible not to finance real estate in this way. The banks will begin to demand it.

---

Final thought...
Sinus congestion sucks.

Bitcoin: A Solution To The Housing Crisis

Bitcoin is the only way those in real estate can manufacture a soft landing for themselves.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdej8ycrgvehxycnyvenhx60ym


Big thanks to nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy and nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx for talking about our efforts with OPN GABRIEL, our relief and recovery operations helping those effected by Hurricane Helene

We have been able to raise over $110k because of platforms like this spreading our message

Fitting that naming this operation after the archangel of communication, God’s messenger of his Word, that what started as establishing communications networks via Meshtastic and Starlink has grown

Because of your generous support we are able to help in an ever growing mission set

Thank you so much! This effort won’t be over anytime soon but we’re grateful to be able to use our skills to help our fellow man.

https://cdn.satellite.earth/d7ad8de51e3eeefad3fc332ff6ee0f180a91e2323c33363ef1ee090575055ab3.mov


It feels like the Fall of 2016 for bitcoin again. If this is the case we’ll pump for 6-9 months before you start getting calls + texts from friends and family about what’s going on.


Still thinking about Sturgill Simpson's cover of Purple Rain at ACL last night.


As we sprint toward the 2024 US Presidential election the case for using bitcoin as an asset to store value for the long term has never been stronger. The insanity of the incumbent power structure is being laid bare and it is becoming impossible to ignore the headwinds that the Borg faces moving forward.

Yesterday morning and earlier today it became clear that inflation is rearing its head again. Not ideal for the soft landing Jerome Powell and Yellen are signaling to the markets after the first Fed Funds rate cut in years.

It seems like the yield curve predicted this earlier this week when it inverted after a temporary normalizing period after the Fed's rate cut. Futhermore, it is becoming glaringly obvious that running historically high fiscal deficits while interest rates were at multi-decade highs was a pretty bad idea. As James Lavish points out, the data from the CBO earlier this week shows that the US federal government is running a deficit that is 13% higher than it was last year. This is at a time when real wages are still depressed, inflation is still suffocating American consumers and the private sector job market for American citizens is cratering.

Speaking of the job market, the numbers that came in yesterday were worse than expected:
The effect of Hurricane Helene should certainly be taken into consideration when looking at this jobs miss. However, even with the miss we know that these numbers have been under reported for years to make the economy seem healthier than it actually is. Even with Helene's effect taken into consideration this print will likely be revised higher 3-6 months from now.

All of this points to a breaking point. A breaking point for the economy and, more importantly, a breaking point for overall confidence in the US government and its ability to operate with any semblance of fiscal responsibility. The chart that Pierre Rochard shares in the tweet at the top of this letter is the only chart that matters for anyone attempting to gauge where we find ourselves on the path to bitcoin realizing its full potential.

There is $133 TRILLION worth of value sitting in global bond markets. Bitcoin is a far superior asset to store one's wealth in. Bond markets are beholden to the whims of the actors who issue those bonds. In the case of the US Treasury market, the largest bond market in the world, the US government. And as we have pointed out above, the US government is recklessly irresponsible when it comes to issuing debt with a complete inability to pay it back on the long-term. Inflation is up, the jobs market is cratering for the native born Americans who actually pay taxes, and the push toward a multi-polar geopolitical landscape is becoming more pronounced by the day. All of this points to a long-term weakening in demand for US treasuries.

The only way out of this mess is to overtly default on this debt or inflate it away. The latter will most certainly be the route that is taken, which positions bitcoin extremely well as people seek the confines of an asset that cannot be debased because it cannot be controlled by a central authority.
The levels of sovereign debt in the world are staggering. Do not let the bitcoin price consolidation of the last six months lull you into a state of complacency. Even the results of the Presidential election won't have a material effect on these dynamics. Though, a Donald Trump presidency would certainly be preferable if you prefer to see relatively sane policy enacted that would provide you with time to find safety in bitcoin. But, in regards to this sovereign debt crisis, that is the only benefit you can hope for; more time to prepare.
I'll leave you with some thoughts from Porter Stansberry:

"We are about to see the final destruction of the American experiment. Every economist knows this (see below) is correct; but nobody is going to tell you about it. I’ll summarize in plan English: We are fucked.

1. Debt is growing much faster than GD and interest expense is growing much faster than debt; and the real growth in entitlement spending hasn’t even begun yet.

2. Progressive taxation means nobody will ever vote for less spending + the combined size of government employees and dependents, there’s no way for America’s actual taxpayers (about 20m people) to ever win an election, so the spending won’t stop growing and, ironically, inflation will make demands for more spending to grow.

3. Inflation undermines both economic growth and social cohesion. The purple hair man-women weirdos are only the beginning; what comes next is scapegoating jews, blacks, immigrants and a huge increase in violence/domestic terror.

Get ready America. This election has nothing to do with what’s coming. And neither Trump nor Kamala can stop it.

Our experiment in freedom and self-government died in 1971 (when all restraint on government spending was abandoned with the gold standard.) You can only live at the expense of your neighbor until he runs out of money.

And that day is here."

---

Final thought...
I hope my tux still fits for this wedding.
Enjoy your weekend, freaks.Use the code "TFTC" for 15% off

Bitcoin, The Bond Market And Resurgent Inflation

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdej8qmr2d3jxuurzvpjtpdkly


RHR 326: PETER TODD IS NOT SATOSHI WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy

https://cdn.satellite.earth/c5b6484c0aeae32584d392264bf27ca6a4b8262f766a4f7e86bdc556325f0dc7.mp4


In the last week the US government has:

- Sent money to Israel and Lebanon (funding two sides of a war)
- Neglected to provide material help to Appalachia in the aftermath of Helene
- Admitted that they’ve been poisoning the public with fluoride for decades

They hate you.


Hot on Fountain | September 30 - October 6 📈

Featuring:  nostr:npub1awyzkzaktxlhyg6syzst3pxy5lvp0c908yphz4ekk9rp3zcapp5qxn79n4  nostr:npub10uthwp4ddc9w5adfuv69m8la4enkwma07fymuetmt93htcww6wgs55xdlq  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy  nostr:npub1jcympy69pht7ptan39se4nd09e4q66qhey649uu3rczm2zh88c7s0n2890  nostr:npub13ql75nq8rldygpkjke47y893akh5tglqtqzs6cspancaxktthsusvfqcg7  nostr:npub1cj8znuztfqkvq89pl8hceph0svvvqk0qay6nydgk9uyq7fhpfsgsqwrz4u  nostr:npub1dg6es53r3hys9tk3n7aldgz4lx4ly8qu4zg468zwyl6smuhjjrvsnhsguz  nostr:npub1563z6kxmvuy7s8zhzan8m0hzmkavyfzg2aw6h7f0fvcvdms398csaxc9n6

https://m.primal.net/LOEF.jpg


https://m.primal.net/LNTU.jpg
https://m.primal.net/LNTV.jpg


Thank God for Nostr. It ensures that Hillary will never get her wish to censor the information she doesn’t like.
https://m.primal.net/LMeI.mov


RHR 325: BITCOIN GOD CANDLE WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx,  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy, AND  nostr:npub1az9xj85cmxv8e9j9y80lvqp97crsqdu2fpu3srwthd99qfu9qsgstam8y8

https://cdn.satellite.earth/4426369859502d6c82f43b4463a52b171d0a0d353906314623d7f7c4f54d356d.mp4


There is a full on confidence collapse under way right now.


What an incredible week at our annual Ten31 portfolio company retreat.

I’m extremely honored and humbled to be able to work with some of the best individuals in the world who are building generational businesses that are making the world a better place.

We’re winning.


Sturgill Simpson. #tunestr https://image.nostr.build/f7563eda98038d99dce13f45f415a9ae08477615a3dcdc4730d01d7a75e114e4.jpg


Thanks nostr:npub1sk7mtp67zy7uex2f3dr5vdjynzpwu9dpc7q4f2c8cpjmguee6eeq56jraw  and nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy for the shout out!

#Bitcoin may be decentralized, but taxes are still a reality. Our team of experienced accountants is here to guide you through the intricacies of #Bitcoin finance, ensuring compliance, and minimizing stress. Reach out to us and enjoy the peace of mind that comes with strategic tax planning with a #Bitcoin Focus.

#accounting #tax #bookkeeping #CPA #CFO https://video.nostr.build/8bcc8835b4c7aa29b4b9ac948e729a845ba0016f07e7f587689c3b1c91e90bf7.mp4


Just laughing while listening to this episode. The corruption from Elizabeth Warren and the FED is 3rd world country level bad. Need to clean house.

nostr:nprofile1qqsywt6ypu57lxtwj2scdwxnyrl3sry9typcstje65x7rw9a2e5nq8sprpmhxue69uhhyetvv9ujuumwdae8gtnnda3kjctvqydhwumn8ghj7un9d3shjtnzd96xxmmfdecxzunt9e3k7mgpp4mhxue69uhkummn9ekx7mq9hxafw nostr:nprofile1qqsgt0d4sa0pz0wvn9yck36xxezf3qhwzksu0q254vruqed5wvuavuspzfmhxue69uhhqatjwpkx2urpvuhx2ucpzfmhxue69uhky6t5wd6xzcmt9eshquqpr9mhxue69uhhyetvv9ujumtfde5kymmvwshxjmnxdu4ryj8q thanks for recording this

https://fountain.fm/episode/6EYWuAkOVW1AsSCoMJmf


This is America. Find light in the darkness.

This country is filled with good people who will answer the call when needed. This is where the signal is despite what the mainstream media would have you believe.

The Cajun Navy and Appalachian Air Force will always be there for their neighbors.
https://m.primal.net/LGHC.mov


Having a black and tan in honor of my old man’s birthday. He would have been 56 today. Love you, legend.
https://m.primal.net/LEzM.jpg


Set him up with a Nutstash wallet.


My oldest just received his first chore money in sats. They grow up so fast.


The Greatest RHR I’ve ever heard due to nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy‘s riveting Bank Run update.

Plebs will be celebrating the energy of that segment till the end of time.

Great work nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx Goose’n on Marty’s Maverick delivery. 🫡

https://fountain.fm/episode/qltr6tLa6LUs458CTFnx

nostr:nevent1qvzqqqpxquqzpu5n0eufdfydvefzrs0wmyfjt8y2rm7mzn96z6q5z5qc2h6lznvdfzk2ea


nostr:nprofile1qqsqfjg4mth7uwp307nng3z2em3ep2pxnljczzezg8j7dhf58ha7ejgpz4mhxue69uhkummnw3ex2mrfw3jhxtn0wfnszynhwden5te0wahhgtn4w3ux7tn0dejszxthwden5te0wdjkuerfwshxummnvekxzun99e3k7mgrcp7e2 and nostr:nprofile1qqsywt6ypu57lxtwj2scdwxnyrl3sry9typcstje65x7rw9a2e5nq8sprpmhxue69uhhyetvv9ujuumwdae8gtnnda3kjctvqydhwumn8ghj7un9d3shjtnzd96xxmmfdecxzunt9e3k7mgpp4mhxue69uhkummn9ekx7mq9hxafw true #signal back in days of shitcoiniery, I was there, they pulled me out.
nostr:nevent1qqsgyx029le2eufgstckdppq3z00qvd3a3785nwjla5jlkc8k5lc98gpzemhxue69uhkummnw3ex2mrfw3jhxtn0wfnj7q3qqny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysxpqqqqqqzrhtu6a


RHR 324: NEVER SHORT BITCOIN WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy

https://cdn.satellite.earth/f9ca31fc7d7c6fe0dc55376698ee53f752eb0c6cbe753fb8386dc37513155488.mp4


GOOD MORNING NOSTR, A LOT CAN BE LEARNED FROM THE DISASTER THAT WAS WEWORK.

MANY WARNING SIGNS PEOPLE IGNORED.

- BOOST TOP LINE REVENUE NOT PROFIT
- RUSH TO IPO
- CULT CEO

https://m.primal.net/HZNd.png


Early bull market signal: hop in an Uber this morning and the driver is listening to @jack mallers debate Peter Schiff.

“Jack is mopping the floor with him.”

We’re going to win.
https://m.primal.net/LCnt.jpg


The hottest startup out of California right now was founded by a boomer who scratched his own itch and figured out a way to repel the homeless from his garage.

Inspiring.
https://m.primal.net/LCSQ.mov


Thank you, nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy and nostr:npub1uyz4w2w4rcphk0q5arzkutrecgscxwzajj4dkvh9mjyqjtxslm6qea8632, for this conversation. I gleefully look forward to the blowback against the unproductive class. May it be glorious.

https://fountain.fm/episode/6EYWuAkOVW1AsSCoMJmf

nostr:nevent1qvzqqqpxquqzqdnw7u32qdmz6707e3lk648uf257qyymnzrcmxk5lve6d522a67qzvduw4


Elizabeth Warren, the Federal Reserve and a number of regulatory agencies have been unconstitutionally targeting banks that service bitcoin and digital asset companies.

An affidavit published last week from Silvergate lays everything bare.

Must read.

nostr:naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxuerxdenx5mrjdee6lzvpy


Last night I had the pleasure of sitting down with Caitlin Long, Founder and CEO of Custodia - a fully reserved bank providing banking services to bitcoin companies, to discuss an affidavit written by Elaine Hetrick of Silvergate Bank. Elaine is the Chief Administrative Officer of Silvergate and wrote an affidavit, a sworn testimony subject to perjury, in which she detailed the events that led to Silvergate voluntarily winding down their business and returning deposits to their customers.

This affidavit is a bombshell because it confirms speculation that Silvergate was solvent in early 2023 and wasn't shut down because of bad risk management on behalf of the bank's management team, but instead was forced to shutter its doors because the Biden Administration, with strong influence from Senator Elizabeth Warren, forced Silvergate's hand because they didn't like that they were banking digital asset companies.

For those who are a bit fuzzy on the details of the narratives that were flying around Silvergate at the time, I'll jog your memory. FTX was a customer of Silvergate's at the time their Ponzi scheme unraveled. As FTX was blowing up, everyone and their mother was scrambling to get their money out of Silvergate because they assumed that since one of the bank's largest counterparties was going bust, the bank must be in trouble too. A sane decision. Especially considering the history of systemically non-important financial institutions this century.

Unless you were paying close attention during this time, you were likely under the impression that Silvergate was a typical fractionally reserved bank that was experiencing a run that led to its inevitable demise. The media made it seem this way. The regulators made it seem this way. And one pompous short seller made it seem this way. However, nothing could be further from the truth.
Here are the most important parts of the affidavit:

>
Silvergate had stabilized, was able to make regulatory capital requirements, and had the capability to continue to serve its customers that had kept their deposits with Silvergate Bank.

Despite this, regulators decided to turn the pressure up and essentially gave Silvergate Bank, and Signature Bank as well, an ultimatum; drastically change your business models immediately by dropping your digital asset customer base or we'll shut you down. There were no hard numbers described in Elaine's testimony, but rumors are that the regulators wanted Silvergate to quickly shrink their exposure to digital asset-related clients to less than 15% of their capital base. At the time, Silvergate's customer base was made up almost entirely of digital asset companies (99.5% to be exact).

The regulators were asking Silvergate to do something that was quite literally impossible given the circumstances. Faced with an impossible task, on March 8th of 2023 Silvergate decided to voluntarily wind down their operations and return deposits back to their customers.

Let's be very clear here, Silvergate did not lose a single penny of customer deposits due to the run on their bank. Management, understanding the volatile nature of the digital asset markets, designed their risk management and capital allocation strategies in a way that would enable them to return dollars to any customer who requested them. And that's exactly what they did when customers came to request their money. They returned EVERY SINGLE PENNY.

This begs the question, "Why did they essentially force Silvergate to shut down?" They seemed to be running a very responsible operation after all. You'd think the regulators would applaud Silvergate's vigilance in risk management on behalf of their customer base. How many banks would have been able to do the same thing if put in the same situation? Probably not many.

The answer to this question is already well known throughout the industry, but Elaine Hetrick's testimony adds some hard evidence that makes it undeniable; Elizabeth Warren, the SEC, the FDIC and the Federal Reserve have been acting in concert to unconstitutionally and extrajudicially target the bitcoin and broader digital asset industry because they do not believe that it should exist. It is a threat to their power structure. The financial system, as it is designed today, gives those who would like to centrally plan the economy and micromanage the lives of American citizens a ton of power. Bitcoin is a threat to that power and they have to do everything in their power to prevent its proliferation.

The targeting of the industry was also confirmed by the aftermath of the NYDFS and FDIC uncharacteristically taking Signature Bank behind the woodshed in the evening of Sunday, March 20th, 2023, despite the fact that Barney Frank and others at the bank were convinced they could handle withdraws come market open the next day.

Signature Bank was ultimately sold to Flagstar Bank. However, they were forced to spin out their digital asset-related accounts before doing so.

This public signaling and sudden regulatory shift made clear that, at least as of the first quarter of 2023, the Federal Bank Regulatory Agencies would not tolerate banks with significant concentrations of digital asset customers, ultimately preventing Silvergate Bank from continuing its digital asset focused business model.

Pretty damning if you ask me. Also, very frustrating and most definitely illegal.

Elizabeth Warren and her gaggle of hall monitors across alphabet soup agencies and the Federal Reserve have been on one massive, unconstitutional, power trip for the last four years. They've besmirched bitcoin and those of us working hard to ensure that the United States of America leads the way forward as bitcoin adoption continues at every turn. Good people striving to make the world a better place.

No one is a better example of this than Alan Lane, the former CEO of Silvergate Bank. I consider Alan a friend and feel supremely confident when I say that he is one of the nicest and thoughtful people I have met in this industry. A man who followed his passion to bring legitimacy and much needed banking services to an industry that the incumbents refused to touch. And he did bring legitimacy. As I explained earlier, Alan and his team understood the volatile nature of the industry and built their firm in a way that took this volatility into account. Silvergate did not fail, they were forced to shut down by Elizabeth Warren and her acolytes at the regulatory agencies.

What's worse, Warren's vendetta against bitcoin and the digital asset industry incited the largest banking crisis this country had seen since 2008. Silvergate and Signature being taken behind the woodshed put everyone on their toes and bank runs started across the country. This led to the failure of First Republic, Silicon Valley Bank and a couple of smaller banks, forced the Fed to step in with their emergency BTFP program, and burdened taxpayers with $40B in FDIC costs that needed to be absorbed as a result. If it weren't for the bailouts things would have gotten completely out of control. All because Elizabeth Warren wants to live in a world in which we are forced to use CBDCs and unable to opt-in to bitcoin.

The euthanasia of Silvergate and Signature are only the tip of the iceberg when it comes to Chokepoint 2.0.

Caitlin Long and Custodia have been in a years long battle with the Federal Reserve to receive a Fed master account so that they can properly serve their customers. For those who are unaware, Custodia is a full-reserve bank that exist to serve bitcoin and digital asset businesses as well as other adjacent businesses like fintechs, banks and funds. Custodia is a chartered bank and special purpose depository institution that has built custody services so that customers can hold bitcoin within their bank accounts alongside their dollar accounts.

Like Silvergate and Signature, Custodia has been singled out and unlawfully denied a master account with the Fed because the Federal Reserve doesn't want a bank like Custodia to exist. Either because they worry about the ramifications of the introduction of a full-reserve bank into a system dominated by fractional-reserve banks or they simply do not want to see bitcoin succeed. If we're being honest, it's probably a combination of the two.

Despite what we, or anyone else, thinks about the potential effect a bank like Custodia could have on the market if it's granted a master account, the Fed's actions are unconstitutional in this case as well. This was made pretty clear (but yet to be determined by a court) in an amicus brief written by Paul Clement on behalf of Custodia earlier this Summer. The Fed is actively undermining the dual-banking system that was set up in this country to enable competition between state chartered banks and the Federal Reserve system.

In the case of Custodia, the Federal Reserve is exhibiting expansive discretionary power that it has never shown before. Custodia is a state chartered special purpose depository institution in the state of Wyoming. Historically, it would be trivial for this type of state chartered bank to get a master account with the Fed. But for whatever reason (we know the reason) the Fed has been denying Custodia their right to this account for a number of years. To the point where Custodia was forced to sue the Federal Reserve and take their case to the courts.

What's interesting about the saga of Custodia and the Fed is that it has forced Custodia's legal team to dig in and highlight where the Fed is overextending its reach and acting arbitrarily.  In the amicus brief that was published in July of this year, Paul Clement argues that the way Federal Reserve Bank presidents are chosen is unconstitutional when you take into consideration the fact the these Fed branch presidents are unilaterally undermining state banking laws by denying master accounts.

If they are going to unilaterally undermine state banking laws they need to be appointed by the President or an official acting on behalf of the Executive Branch. Federal Reserve Bank presidents aren't appointed by the President of the United States or any official acting with the authority of the Executive Branch. Instead, they are appointed by their boards, which are controlled by the privately held commercial banks who own them. The Federal Reserve system is clearly acting unconstitutionally when they deny Custodia from being assigned a master account.

The people in power within the federal government and the Federal Reserve system are actively targeting the bitcoin and digital asset industry, acting extrajudicially and making a mockery of the rule of law in the United States. They are completely out of control and it is important that everyone who cares about the future of bitcoin in the United States and the future of the United States more broadly (even if you don't like bitcoin) speaks out and fights against these totalitarians as vehemently as possible. What they are doing is wrong. It's unconstitutional. And it is putting the future of our country at risk.

If the federal government, the regulators and the Federal Reserve do not get out of the way and let law abiding citizens build the businesses they want and associate with businesses they want, those businesses will go elsewhere and the United States will be set back generations as a result.

It's time to put these people in their place and let it be known that freedom will reign supreme in the Land of the Free. Fight!
---

Final thought...
I promised Parker Lewis that I would do cross fit on Friday morning and I'm using today's final thought as an accountability tool.

Operation Chokepoint 2.0, The Fed v. Custodia, and the 2023 Banking Crisis

How Elizabeth Warren incited the banking crisis of 2023.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxuerxdenx5mrjdee6lzvpy


Future generations will look back on fiat currencies controlled by central banks and laugh at the absurdity of it all.

Bitcoin will be the most obvious innovation in human history to the Earthlings of 2100.

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Bitcoin's fundamentals are stronger than ever.

This is evidenced by continued improvement to the protocol stack, adoption by reputable actors like the Kingdom of Bhutan, and the mismanagement of the fiat monetary system.

Don't fade the coin.

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While most of the world is focused on the lead up to the Presidential election here in the US and louder war drums being beat across the world, the number of bullish developments that are stacking up for bitcoin is increasing rapidly. These developments deserve the OG Marty's Bent smorgasbord treatments, so here are the things that have caught my attention over the last week in no particular order.

### The First Ark Transactions on Bitcoin Mainnet

I had the pleasure of participating in a demo of Second's Ark protocol implementation. For those who are unaware, Ark is a new layer-two protocol solution for making off-chain bitcoin payments. Unlike the lightning network, Ark doesn't depend on liquidity channels to facilitate payments. Within the lightning network two counterparties share UTXOs within a channel to move sats back and forth, nodes connect to many different channels to create a network effect that increases the chance of payments getting routed successfully, and node operators manage their channel liquidity as channel imbalances emerge.

Ark is similar in the sense that it also leverages a shared UTXO model. However, instead of having one-to-one channels that come with liquidity management issues, Ark enables a large amount of individuals to share UTXOs, which are managed by an Ark Service Provider (ASP). The ASP is a central party within the protocol, but it is a central party that does not custody UTXOs. It only coordinates the transfer of sats between Ark "rounds". Users have the ability to unilaterally exit the second-layer protocol whenever they deem necessary by broadcasting a Virtual UTXO (vtxo) transaction.

This may seem daunting and complicated. All you need to know is that there is now an new way to make off-chain bitcoin payments that are fast and relatively cheap and it is possible today. As it stands today, Ark has some scaling limitations that can be solved if covenants get merged into the bitcoin protocol, which would significantly reduce the data requirements for signing this type of transaction.

It should also be noted that Ark isn't here to replace the lightning network. It can help serve different use cases and, at the same time, significantly improve the UX of the lightning network. Particularly channel management. The progression of the Ark protocol is a welcomed development. I look forward to following what's going on with Ark as the protocol matures.

### The Kingdom of Bhutan is Stacking A LOT of Sats

We were made aware of the fact that the Kingdom of Bhutan, a small country in the Himalayas with a population less than 1,000,000 people, was mining bitcoin in early 2023 when their sovereign wealth fund was doxxed in the bankruptcy proceedings of BlockFi and Celsius. Don't look now, but Bhutan has been doxxed again, this time by the chain surveillance firm Arkham, which is reporting that the nation currently holds more than 13,000 bitcoin, which is nearly 1/3 of its GDP. Driven predominately by its mining operations, which have expanded significantly over the last two years in an attempt to monetize the country's excess hydroelectric power.

While we're not big fans of doxxing here at TFTC, we are fans of the game theory of bitcoin playing out in front of our eyes. And the Kingdom of Bhutan is a shining example of the game theory bitcoiners have been talking about for 15 years playing out perfectly.

Bitcoin is a very thorny topic for individuals at every layer of society. At the individual layer, people have to independently decide that bitcoin is a better money and they have to actively decide to store their wealth in it instead of other assets. For companies, the decision to use bitcoin as the preferred savings vehicle is even harder because most businesses have multiple stakeholders that need to align on a decision before making it. When you move up to the nation state level, the complexity of making the decision to add bitcoin as a strategic reserve asset gets even harder. Many more people and different branches of government need to agree and pass bills (in most cases) before bitcoin can ever make it into a nation's treasury asset mix.

It has long been said within bitcoin circles that individuals who have the ability to think independently, companies that have a lean corporate structure, and nation states with little to lose will be the first movers into bitcoin. And they will benefit massively over the long-run for being early.

If you're an individual reading this who is using bitcoin as their money of choice, you are one of these early movers. Microstrategy under Michael Saylor, who has the ability to make somewhat unilateral decisions due to the company's share structure, is an early move. And, Bhutan, a small nation in the Himalaya mountains with a sovereign wealth fund that seems to have the ability to take risk, is an early mover.
With little to lose and greatness to gain, Bhutan is giving other small nation states the playbook for leap frogging the competition in the digital age. Stack a shit ton of bitcoin on the DL, hold on to it for a considerable amount of time, and wake up one day as an economic powerhouse.

### The Fed Cuts Rates by 50 Basis Points

I'm sure all of you are well aware at this point. Last week the Federal Reserve made it's first rate cuts in over four years when it cut the fed funds target rate by 0.50% to 4.75-5.00%. With the economy reeling despite what the official government and mainstream narrative may try to make you believe, Jerome Powell and crew have decided it is time to ease up on their monetary policy.

Put another way, inflation is likely to come back with a vengeance as easy money begins to reenter the economy. To be clear, a lower fed funds rate doesn't technically necessitate that newly printed dollars enter the economy like they have over the last 15 years via operations like quantitative easing. However, one has to imagine that the Fed sees some sort of liquidity crisis on the horizon that requires them to begin cutting rates. And not only cutting, but cutting at a pace that was very low probability only a couple of months ago. The consensus in the middle of the Summer was that the Fed would begin lowering rates with a modest 25bps cut this month. They doubled that.

It's probably safe to assume that something is approaching a breaking point on the back end of the financial system. One only has to look at record high credit card debt, record low savings rates, the state of the job market for native born Americans, and the continued turn over of commercial real estate markets to see that not all is well in the American economy. Your Uncle Marty's spidey senses are signaling that a liquidity crunch is likely lurking around the corner. When it does rear its ugly head, you can expect quantitative easing to make a big come back.

When money printer goes brrr, bitcoin goes berserk.

It seems that the Treasury's move over the last 18-months of over-indexing on the front end of the curve during their auctions is already having an expansionary effect on M2 as it has officially entered expansion territory for the first time since 2022. Hold on to your butts, freaks.

Bitcoin's fundamentals are only getting stronger as time goes on. This is evidenced by continued improvement to the protocol stack via second layer protocols, continued adoption by reputable actors like the Kingdom of Bhutan, and the continued mismanagement of the fiat monetary system.

The price of bitcoin has been range bound since the Spring and it has lulled the market into a state of boredom. Enjoy the boring period while it lasts. All signs are pointing to a bitcoin bull run the likes of which the world hasn't seen before. There is a lot of tinder, it is extremely dry, and there are flame throwers on the horizon.

---

Final thought...
Nothing makes me happier than meeting someone who gets value from this newsletter or the podcasts in the wild. Love you, freaks.

Bullish Bitcoin Developments Are on the Rise

Don't look now but the bulls are getting in line for the stampede.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxucnxvpkxvcnqwf5fulkkj


The world has gone mad. Praying for peace.
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RHR 323: POWELL PUMPS THE COIN WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy

https://cdn.satellite.earth/997439390516c98b6fbe9aedf216cb309a09a0f77b8fb23e0b9fe6425c6c4dd7.mp4


I feel like they already successfully memory holed the fact that Biden is still the President of the US.


Despot.

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Palindrome price right before we go live for RHR? Yeah, it’s going to be a good one.

We’re pumping. Burgers are being bought.

Join us.

https://tftc.tv - YouTube
https://rhr.tv/stream - Zapstream
https://m.primal.net/KuzG.jpg


RHR LIVE IN 4.5 HOURS AT 1800 UTC. 🫡

https://rhr.tv


In the room where it happens.
https://image.nostr.build/f1bd17df540bceb7f8f4f2ed7979cc20c86e7d38ddc35d1d8988321c08cc1ee4.jpg


War machines have never been easier and cheaper to deploy.

In a world that is becoming increasingly fractured and angry, this is absolutely frightening.

Asymmetric warfare as predicted in the Sovereign Individual is upon us.

nostr:naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxcmrydfkxyen2vfhmrxftz


As I'm sure many of you are aware already, Israel executed an attack on thousands of Hezbollah members in Lebanon earlier today. At the moment, it looks like Israel successfully waged a supply chain attack on the pagers used by Hezbollah members. Intercepting the devices and placing highly explosive material on the batteries that could be triggered remotely by raising the temperature of the batteries.

To my knowledge, this is the first time an attack of this nature and of this scale has ever been waged. This is a very serious and dangerous precedent that should make anyone reading this think long and hard about the ramifications of the normalization of this type of warfare.

It's not clear to me yet whether this is exactly what happened, but this seems to be where all of the reports are pointing. And when you consider the scale of this operation, it is hard to think of alternative ways that this could have been achieved outside of corrupting the supply chain of this particular pager. Regardless, the die has been cast and remote detonation attacks in crowded civilian areas has been battle tested as an appropriate war tactic.

Not only does this set a terrible precedent for war, but it also begs the question; if they can do something like this with a relatively dumb pager, how much damage could they do with something like an iPhone? How vulnerable are the billions of people who hold smartphones in their pockets, or drive internet connected electric vehicles with lithium ion batteries? How trivial was it for Mossad to gain access to these devices and at what part of the supply chain? Now that this attack has been deemed to be "on the table" how long will it take before others begin to wage similar attacks?

War tactics and their costs are rapidly changing right before our eyes. The war between Russia and Ukraine is showing that low cost drones strapped with bombs can be very effective weapons that can do damage to military equipment worth anywhere between tens of millions to billions of dollars. The Houthi rebels have used cheap drones to completely disrupt the Suez Canal for the better part of a year. The world has only seen the tip of the iceberg in regards to how this type of technology can be used at scale to tip the leverage of power towards those with less financial resources, but a willingness to engage in kinetic conflict. Some of these drones are strapped with thermite flame throwers!

Now that new information has been brought to the market - you can turn pagers and (likely) cellular phones into a network of improvised explosive devices via a software push that increases the temperature of the devices' batteries - it is only a matter of time before others figure out how to do it and begin using these tactics themselves. War machines have never been easier and cheaper to deploy. In a world that is becoming increasingly fractured and angry, this is absolutely frightening. Asymmetric warfare as predicted in the Sovereign Individual is upon us.

As it relates to bitcoin hardware, these attacks highlight that an attack that has been long talked about in the industry but not yet exploited to the best of our knowledge is very real. Supply chain attacks, particularly on bitcoin signing devices that store private key information, have just been proven to be very possible by motivated state actors. If a nation state wanted to somehow "prove" that bitcoin is insecure or figure out a low effort way to do a mass confiscation of bitcoin all they have to do is successfully attack the supply chain of a hardware manufacturer, corrupt the devices, and let them flow to the hands of individuals who believe they are securing their bitcoin in the best way possible.
The best way to mitigate this risk is to hold you bitcoin in a multi-sig wallet using a quorum of keys produced by different hardware produced by different manufacturers. Companies like Unchained make this process as seamless and possible and supply chain attacks like the one that was laid bare today highlight why these collaborative custody models are so important. Especially if you are holding a large amount of wealth in bitcoin.

This is a sad day for the world. I'll be praying for peace and sanity to prevail.
---
Final thought...
That was a terrible loss by the Birds.

Israel Uses a Supply Chain Attack to Target Hezbollah Members

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxcmrydfkxyen2vfhmrxftz


Rep. Tom Emmer: "They are scared to death of decentralization because it restores what this country was built on, which is by the people from the ground up."
https://m.primal.net/Kszi.mov


This was one of the more inspiring rips I've recorded in some time. I sat down with  nostr:npub1v6z4srj4ktch4f3ee9ze2zp7ml4n9rshttmntpamfed0nvpev5fszzuq49 to discuss the mechanics of the supranational regulatory regime that dictates what information financial institutions need to collect.

There's a big call to action in this rip; send a FOIA request to your politicians. If they won't hold themselves accountable you should be using the tools at your fingertips to hold them accountable yourself.

We're going to win!

https://fountain.fm/episode/dg7rlmtOICVDGwtr7Jnc


Teach love not hate … and maintain good manners, no matter what - great message m. Calmer heads must prevail.  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy  nostr:npub1sk7mtp67zy7uex2f3dr5vdjynzpwu9dpc7q4f2c8cpjmguee6eeq56jraw 🧡

https://fountain.fm/episode/fi5TdVLTAQ304Ym7ScvV


REALLY ENJOYED THIS BACK AND FORTH WITH  nostr:npub1s5yq6wadwrxde4lhfs56gn64hwzuhnfa6r9mj476r5s4hkunzgzqrs6q7z AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy.

INTERESTING TOPIC. FULL CHAT ON CITADEL DISPATCH FEED.

https://cdn.satellite.earth/516e6de6b4af62d260600af7221c62b4668ab21348bbca6e4659583cdb808342.mp4


Carmel by the Sea, California


https://m.primal.net/KprS.jpg
https://m.primal.net/KprT.jpg
https://m.primal.net/KprU.jpg
https://m.primal.net/KprV.jpg


Carmel by the Sea is pretty epic.
https://m.primal.net/Kppl.jpg
https://m.primal.net/Kppm.jpg


Keep crushing.

https://fountain.fm/episode/EwY1QqZ4ynFrExX6ZHAR

nostr:nevent1qvzqqqpxquqzq0ra87tmvuq0n39kyy2z7e9tc75l3xlmxlr555saq4a9tzfr2ykvzpmjwy


Love to see it!


nostr:nprofile1qqsywt6ypu57lxtwj2scdwxnyrl3sry9typcstje65x7rw9a2e5nq8sprpmhxue69uhhyetvv9ujuumwdae8gtnnda3kjctvqydhwumn8ghj7un9d3shjtnzd96xxmmfdecxzunt9e3k7mgpp4mhxue69uhkummn9ekx7mq9hxafw I think my fiance heard you talking about making stuff with the raw cream today and made us some vanilla ice cream, so tasty!


Nostr Valley got a shout out!  nostr:npub15u3cqhx6vuj3rywg0ph5mfv009lxja6cyvqn2jagaydukq6zmjwqex05rq  nostr:npub18ams6ewn5aj2n3wt2qawzglx9mr4nzksxhvrdc4gzrecw7n5tvjqctp424

https://www.youtube.com/live/K4xh60s0lfA


Got the black lung.


I have watched nostr:nprofile1qqsywt6ypu57lxtwj2scdwxnyrl3sry9typcstje65x7rw9a2e5nq8sprpmhxue69uhhyetvv9ujuumwdae8gtnnda3kjctvqydhwumn8ghj7un9d3shjtnzd96xxmmfdecxzunt9e3k7mgpp4mhxue69uhkummn9ekx7mq9hxafw cough fifty times now 🤣😂🤣😂🤣😂

https://video.nostr.build/cdfede0a165546104afc7a5311939b8483b806d2475caecb8b67e96e7517cb9d.mp4


JD Vance: "We should be concerned about big tech companies and some of the mergers that lead to the censorship of American citizens, [but] I do think not all mergers and acquisitions are bad."
https://m.primal.net/KnsP.mov


#Bitcoin mining difficulty hit new all-time high with the latest difficulty adjustment
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It’s a beautiful morning in Austin, TX.


RHR 322: BITCOIN MINING MAYHEM WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy

https://cdn.satellite.earth/a72b2f93c785d0248b732b9df8fabfab67fbdd8dd17f88270809e33d6126f17d.mp4


I mostly don't like rap, but damn, do I always listen to your work. Such talent. Keep building brother. You're killing it. 🎙🎙🎙

https://wavlake.com/track/f46d82f2-7f26-4357-9258-32da68324f74

nostr:nevent1qvzqqqpxquqzqzt0v3tmfaypfv3477ysyc3x7hrwqg28sr3xd93cfrg9jwwx03we8qgmhe


I am here to remind you that there is no industry in the world that is more ruthlessly competitive than the bitcoin mining industry.

With difficulty at an all time highs, hashprice hovering above all time lows, and no price pump in sight it's very hard to be a bitcoin miner.

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TAPS SIGN

"There is no industry in the world that is more ruthlessly competitive than the bitcoin mining industry."

From any angle you cut it the bitcoin mining economic landscape is absolutely BRUTAL at the moment. Hashprice is sitting right above an all time low at $0.04/TH/day. Yesterday brought with it yet another new difficulty all time high. Competition for energy resources is as fierce as it has ever been as rack space continues to be tight in the United States and hoards of AI data centers move in to scoop up as much power as possible.

To make matters worse, with current economics it doesn't really make sense to buy bitcoin mining machines at their current prices. The pay back period on machines is absurd considering where we find ourselves in the market. Adam O from Upstream Data broke it down in a tweet earlier today.

As he says, it probably makes more sense to buy used machines than new machines right now if you are looking to make back your money on a reasonable timeline. The only reasons you would buy new hardware right now is if you believe the price is going to rip in the near term (risky bet), you think hashrate is going to come off the network (risky bet), or if you have obscenely low power costs (unlikely for most).

If you have machines plugged in or are thinking about plugging them in soon you better be running firmware that enables you to run your machines more efficiently to increase margins. With current economics, I would make the argument that it is incredibly irresponsible to be running your machines using stock firmware. Especially if you are operating a miner in the public markets or are a private miner backed by investors. It is a disservice to your shareholders. This is a strategy we have been deploying at Cathedra for years now and it has helped us to survive during these trying times in the mining industry and set us up to successfully complete a strategic merger with Kungsleden at an opportune time.

On that note, this is a trend you can expect to pick up over the next six months; mergers and acquisitions. We wrote earlier this year that M&A activity would pick up after the halving began to eat into the economics of mining businesses and that is exactly what is happening. We decided to move early at Cathedra to get ahead of the curve. Since then Cleanspark announced a merger with GRIID, Riot has initiated an attempted hostile takeover of Bitfarms, Bitfarms has entered an agreement to merge with Stronghold, and Terawulf has signaled that they are open to a merger if a particular deal makes sense. On top of this, Rhodium slipped into bankruptcy last month. As margins continue to be squeezed and companies get more desperate I expect this type of consolidation to accelerate.

All signs are pointing toward more pain in the world of mining in the near term. There is nothing outside of a face ripping rally in the price of bitcoin or some unforeseen event that knocks out a material amount of hashrate that will change this reality. Especially considering the fact that Bitmain announced a new hydro model that will produce 860 TH/s at ~13 J/TH! This will be the highest hashing, most energy efficient machine to ever hit the market by a considerable margin.

Once these machines hit the market (if they haven't already via Bitmain plugging them in, which could explain new difficulty all time highs despite terrible mining conditions) every other machine on the market is going to suffer economically.

To make matters worse for everyone struggling right now, savvy energy producers are beginning to understand the benefits bitcoin mining can bring to their operational stack. Japanese energy giant TEPCO is reportedly planning to scale up their mining operations after beginning pilots in late 2022. They want to utilize the excess energy produced by renewable sources to mine bitcoin. From what I can tell, they haven't scaled up significantly yet. However, it is reasonable to believe that they will scale up and other energy producers will take notice. Pushing the industry closer to its inevitable end state; vertical integration via energy producers who have the lowest cost of production.

Thank you for coming to my TED Talk. Keep hashing if you can.

Final thought...

The pets need protecting.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxccnzvpexy6rwv3cfhk50e


You don't hate the media enough.


Episode will drop on Monday.


Just recorded the most insightful and invigorating rip for TFTC in some time.

Be the change you want to see in the world.

Action leads to change.

We’re going to win.


Building a company is hard in it's own right. Building a bitcoin company is significantly harder for a number of reasons.

I shared some reflections on my conversation with Will Reeves about Fold's journey from a startup to a publicly traded company.

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I had the pleasure of sitting back down with Will Reeves, Founder and CEO of Fold, on TFTC last week to discuss Fold's journey from a startup to (soon to be) a publicly listed company. I particularly liked this conversation because it was a great lens into the grit it takes to run a successful bitcoin company.

https://fountain.fm/episode/1FrspxmpK5bsoReGx73n

Building a successful company is extremely hard in its own right. Building a successful bitcoin company is significantly harder considering the fact that you're building a company in parallel with a nascent and volatile monetary asset that is monetizing in real time. Bitcoin adoption comes in waves. People flood in when the price is ripping and fade out when the price corrects and goes into a multi-year bear market before the tide comes back in. This means that your potential user base is expanding and contracting more than it would be in other industries. As a company you need to be able to absorb the incoming waves of new adopters and then capture and retain the users who stick around for the bear market.

To do this correctly, a founder and their team needs to thread many needles. First, can you assemble a team that can actually build something? Second, can you bring a product to market that people actually use because it provides value to them? Third, can you stick out against the crowd? So on and so forth.
One of the most important aspects of building a bitcoin company during bitcoin's monetization phase is timing. There are many great ideas that people have in terms of companies, products and tools that can built using bitcoin. There are sci-fi futures that can be built today on bitcoin if people really wanted to.

The problem that arises is that adoption and understanding of bitcoin are at a point where, even though a functional product could be brought to market, it won't be adopted by a large number of people because there 1.) aren't enough people who would understand how to use it and 2.) for the people who do understand how to use it and could benefit from it, the universe of people they can interact with using that product is minuscule.

Timing is everything. And I think Fold nailed the timing of their product. Allowing people to passively stack sats by offering a product that enables them to go about their daily spending and get sats back instead of cash back rewards is a great first-touch bitcoin experience. Once Fold found their sticky user base and perfected their sats back experience, they began expanding their product offering to provide their users with more bitcoin services. Buy/sell bitcoin in-app, bill pay for sats back, and more. They'll eventually roll out a credit card and additional financial services. Start simple, provide something of value, nail the timing and then expand from there. That seems to be the recipe.

For any founders in the space reading this, I highly recommend you listen to the episode. Particularly for the advice Will gives about knowing when to sprint on product and when to lean into growth. Bear markets are for building and bull markets are for casting the widest net possible and capturing as many new users as possible.

At Ten31 we are extremely proud to back Fold and a number of other companies in the bitcoin space that understand the intricacies described above. We work with some of the best founders in the world. Founders who know how to eat glass with the best of them. Bitcoin can be a cruel mistress and no one knows that more intimately than the founders building bitcoin companies.

---

Final thought...

The NFL having a week 1 game in Brazil should get Roger Godell fired.

Enjoy your weekend, freaks.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejx5mr2wfkxu6rjd3sh6ffh2


Soon

https://t.co/pCZpYc6VoP


The number of loans underwritten to strip centers with Walgreens as the anchor tenant is quite significant. This is 08-09 all over again. Ironically Walgreens replaced a lot of the former anchor tenants that were washed out and caused the sale of strip centers for 30-60 cents on the dollar. The new buyers got a AAA rated tenant, and new debt was lent to the new buyers. Many loans were even increased after the multiple 5 year terms. Enjoy the show.


I had the honor to interview María Corina Machado, the leader of the Venezuelan opposition, about how fiat money was weaponized against the Venezuelan people by the Chávez and Maduro regimes

She says Bitcoin is a "lifeline" and "vital means of resistance" and said that a future democratic Venezuelan government will use Bitcoin to rebuild the national reserves that the Chávistas stole and put Venezuela back on a path to peace and prosperity

I've put out a lot of content in the past few years but I think this is the most important thing I've done -- the implications are vast considering a) Venezuela is one of the world's largest energy exporters with some of the world's largest oil reserves and b) María Corina Machado is not some rogue leader or dictator but a US ally

I hope you can watch 🇻🇪
https://m.primal.net/KfiC.mov


Rite Aid and soon Walgreens. Another big issue here could leave a heavily medicated society no longer having access to their happy pills nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy I guess it leaves room for Walmart and Amazon to swoop in. https://image.nostr.build/ab194234f509fd608bda6a8af8df9b06c614f61c5859638c9c52734123766d20.jpg


The zombie economy is on its last legs as is evidenced by companies like Walgreens, which find themselves strapped for cash, loaded with debt, and on the brink of bankruptcy.

This puts the Fed in a catch-22; let them fail or turn the money printer on.

nostr:naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejx56nwdph8qmrydf394ez7f


[https://x.com/parkeralewis/status/1831746160781938947]()
Here's a startling chart from an American staple, Walgreens. The convenience store and pharmacy chain has seen its stock price plummet by more than 67% this year and by more than 90% from its all time high, which was reached in 2015.

The combination of the COVID lock downs and the lax laws around theft that followed were materially detrimental to Walgreens business. The crux of their problem at the moment, however, is a double whammy of those disruptions in their business coupled with the "higher for longer" interest rate policy from the Fed over the last couple of years. As Tuur points out in the tweet above, Walgreens has $34B in debt, which means they definitely have significant interest rate payments they need to make on a monthly basis. Tuur also points out that Walgreens has very little cash compared to their debt obligations. Let's take a look at their balance sheet as of May of this year.

![https://www.tftc.io/content/images/2024/09/Screenshot-2024-09-05-at-3.59.46-PM.png]()

Less than $1B in cash for $34B debt with $67.56B in total liabilities. Even worse, their cash balance was drained by more than 27% over the course of the year between May 2023 and May 2024. As you may notice their total assets fell by more than 15% over the same period. This is because Walgreens understands the dire financial straits it finds itself in and has begun shutting down thousands of their locations across the country.

![https://www.tftc.io/content/images/2024/09/Screenshot-2024-09-05-at-4.49.58-PM.png]()

The recent efforts of Walgreens to sell off their assets to raise cash to pay down their debts seem to be completely ineffective as their cash balance is falling faster than their total assets, which is falling 7x faster than their total liabilities. These numbers are most definitely going to get worse as cascading sell pressure in commercial real estate markets (which is the bucket that Walgreens locations fall into) drive down the value of their assets. Leaving them with less cash to pay down their debts as time goes on.
To make matters worse, it puts the institutions that lent money to Walgreens in a terrible position. How many commercial and investment banks has Walgreens tapped to fund their operations with expensive debt? How exposed to Walgreens is any individual lender? Could a default on some or all of their loans catch these financial institutions off sides? If it isn't Walgreens that pushes them off sides, how many more bad borrowers would it take to push them off sides?

As our good friend Parker Lewis points out, the only way the hemorrhaging can be stopped is if the Federal Reserve and Federal Government step in with bail outs in the form of massive liquidity injections via quantitative easing and other emergency measures. On top of this, the Fed and the Federal Government find themselves in a classic catch-22. If they let Walgreens fall into bankruptcy it could set off a domino effect that could exacerbate inflation. Riteaid, a similar retail convenience store and pharmacy chain, filed for bankruptcy last October and is still wading its way through that process. Part of that process has been shuttering many of their storefronts. One has to imagine that since Walgreens and Riteaid are having these problems, some of their other competitors must be feeling the pain as well. If enough of these convenience stores, which tens of millions of Americans depend on for everyday goods, find themselves in a position where they have to shut down their stores it could lead to a supply crunch. People will obviously not be able to get their goods from Riteaid or Walgreens and will flee to alternatives, exacerbating the stress on their supplies, which will drive prices higher.

This is a catch-22 because the only way to avoid this mad dash for consumer goods in the midst of a convenience store Armageddon is to re-introduce ZIRP and flood the market with freshly printed dollars, which will drive prices up as well.

Talk about a rock and a hard place. You better get yourself some bitcoin.

---

Final thought...
Zach Bryan radio crushes.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejx56nwdph8qmrydf394ez7f


could we please develop an AI supported proper name pronunciation APP for all the particularly linguistically gifted podcasters of this world (i.e. only for nostr:nprofile1qqsywt6ypu57lxtwj2scdwxnyrl3sry9typcstje65x7rw9a2e5nq8sprpmhxue69uhhyetvv9ujuumwdae8gtnnda3kjctvqydhwumn8ghj7un9d3shjtnzd96xxmmfdecxzunt9e3k7mgpp4mhxue69uhkummn9ekx7mq9hxafw) that completely deletes and replaces his pronunciation from the audio track?!


Hunter Biden to plead guilty to federal tax charges today, facing up to 17 years in prison.

A presidential pardon is expected shortly.
https://m.primal.net/Kftx.mov


RHR 321: FEAR, UNCERTAINTY, AND DOUBT WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy

https://cdn.satellite.earth/564c5b2303f5830b3eecd43d6bf3538a8dc8492f40685b448cb6c74bdc5e2fd2.mp4


 nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx
 nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy
 nostr:npub10uthwp4ddc9w5adfuv69m8la4enkwma07fymuetmt93htcww6wgs55xdlq

🤘🤘🤘
https://www.youtube.com/watch?v=vOxAz1Sr-bc


“Hate speech” is a made up Marxist euphemism. A dog whistle for aspiring censors.

There is no such thing as hate speech. There is only speech that particular people don’t like.
https://m.primal.net/KfdA.mov


Another great rip and update from nostr:nprofile1qqsw4m6evhlz0qj02ekw86657dc5nm3gunvgk4ux0r4qyz6h2ywkk7gpzamhxue69uhhyetvv9ujucm4wfex2mn59en8j6gpz3mhxue69uhhyetvv9ujuerpd46hxtnfduq3samnwvaz7tmjv4kxz7fwwdhx7un59eek7cmfv9kqvrj95t and nostr:nprofile1qqsywt6ypu57lxtwj2scdwxnyrl3sry9typcstje65x7rw9a2e5nq8sprpmhxue69uhhyetvv9ujuumwdae8gtnnda3kjctvqydhwumn8ghj7un9d3shjtnzd96xxmmfdecxzunt9e3k7mgpp4mhxue69uhkummn9ekx7mq9hxafw on nostr:nprofile1qqsgt0d4sa0pz0wvn9yck36xxezf3qhwzksu0q254vruqed5wvuavuspzfmhxue69uhhqatjwpkx2urpvuhx2ucpzfmhxue69uhky6t5wd6xzcmt9eshquqpr9mhxue69uhhyetvv9ujumtfde5kymmvwshxjmnxdu4ryj8q. Is there a more undervalued bitcoiner than nostr:nprofile1qqsw4m6evhlz0qj02ekw86657dc5nm3gunvgk4ux0r4qyz6h2ywkk7gpzamhxue69uhhyetvv9ujucm4wfex2mn59en8j6gpz3mhxue69uhhyetvv9ujuerpd46hxtnfduq3samnwvaz7tmjv4kxz7fwwdhx7un59eek7cmfv9kqvrj95t? The detail he has and shares is first class. Cheers both #bitcoin


With all of the focus on bitcoin as a strategic asset I think some technical developments and trends have been overlooked. Particularly in the realm of second layer privacy.

BOLT 12 is making progress and people are waking up to the power of ecash.

nostr:naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejx56rjvpjxg6r2wph7rvpay


For the last few months many people in bitcoin, myself included, have been focused on bitcoin's role as a macroeconomic asset. Bitcoin as a strategic reserve for the US government. Bitcoin as a strategic treasury asset for corporations. Bitcoin as a geopolitical hedge in a world that is trending toward a multi-polar power dynamic. This is where the focus has been. And for good reason. These trends will ultimately have a material effect on the price of bitcoin if they pick up steam.

However, with all of the focus on bitcoin as a strategic asset I think a couple of technical developments and trends have been overlooked. Particularly in the realm of second layer privacy. I'll touch on two of them in this letter; BOLT 12 invoices and the progression of ecash.

Yesterday afternoon the Strike (a company Ten31 is very proud to be backing) team released a blog post that detailed their journey to implementing BOLT 12 offers in their product stack. For those who are unaware of BOLT 12 and why it is important, in short, it is an upgrade to the lightning network that would make receiving bitcoin on the lightning network more private while also significantly improving the user experience. The current standard for invoicing people via the lightning network is BOLT 11, which forces users to create a unique invoice every time they want to receive bitcoin and comes with privacy tradeoffs for the party receiving bitcoin.

BOLT 12 brings with it route blinding which allows a receiver to publish a lightning offer to the network without revealing their node's public key. It also brings with it onion messaging, which allows users of the lightning network to communicate without a dependence on HTTP, which can be censored by a motivated state actor. On top of this, it enables users to create a static invoice that can be paid multiple times by multiple people. Think of a band putting their Venmo or Cash App QR code next to their tip jar on the stage. They'll be able to add a private lightning invoice their audience can pay to now.

https://strike.me/blog/bolt12-offers/

As it stands right now, Strike has only enabled BOLT 12 offers and there is work to do at the protocol layer of lightning and the different implementations of that protocol to get the full benefits of BOLT 12, but this is material progress that gets us closer to a significantly better user experience on the lightning network. If you read Strike's blog post you'll come to appreciate the collaboration between the teams working on these implementations and the companies implementing the protocol that is necessary to get these features live. Shout out to everyone who worked on this. Everyone who uses the lightning network will be better off when BOLT 12 is fully implemented.

Moving on. Earlier today the founder of the BTCPay Server open source project, Nicolas Dorier, published a blog post outlining his thoughts on how ecash has the potential to solve problems that many have tried to solve by launching their own blockchains in the past. The problem with trying to "blockchain the world" is that blockchains are very inefficient and only really work for one application; enabling a peer-to-peer digital cash system with no trusted third parties (i.e., bitcoin). However, the ultimate goals of the thousands of blockchain projects that spun up in bitcoin's wake are desirable. Cheap, private and instant transactions. The ability to trivially spin up private money tokens suited for very particular use cases. Overall great UX that makes it easy for people to realize the benefits of "blockchain technology".

The problem that has existed to date is that you don't need a blockchain for all of these things. In fact, having a blockchain for these things proves to be detrimental to their ultimate goals. Instead, what people really need is a protocol that gives you the granular control, privacy, instantaneous transactions and UX that anchors to bitcoin. This is exactly what Chaumian Mints bring to the bitcoin stack.

This is something that we've been screaming about for more than seven years in this rag. Now with ecash protocols like Cashu and Fedimint maturing, gaining traction and bringing products to market that highlight the power and flexibility of ecash systems, people are beginning to see the promise. It is only a matter of time before more and more people begin to realize this potential.

Another benefit of ecash protocols is the fact that they are siloed from each other. Ecash mints are permissionless; any one person or group of people can spin them up, offer their preferred services and maintain (or fail to maintain) their mints. The failure of one mint is not a systemic risk to other mints. This is very different from token projects that are spun up on blockchains. The last ten years have proven that individual token projects can prove to be systemic problems for individual blockchains (i.e., The DAO token on Ethereum). Being able to silo mints is the only way to ensure that the utility of ecash overall is actually scalable and robust.

Don't get so distracted by the bitcoin macro talk that you miss out on the incredible technical developments happening on top of and adjacent to bitcoin.

---

Final thought...
Vibes are high.

Don't look now, but bitcoin privacy is getting better.

This is a long form article, you can read it in https://habla.news/a/naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejx56rjvpjxg6r2wph7rvpay


The upper bound of this range (which is probably generously conservative) would mean that 12% of 2023 tax receipts ($4.4 TRILLION) were funneled to criminals within the government.

Taxes have become one big humiliation ritual.

nostr:note1upuw4ew4mv9dw3gs2h4hlgyk2fv5nuvzrp52yvpgc8nsjrmcsddq3q096n


The best part of this rip is Luongo explaining how the cretins are so used to manipulating markets and getting people to dump their assets to them, but we have the reverse situation playing out with us hodlers where they are dumping to us, and none of us budge when they try to tank the price. They think they are going to control #Bitcoin, but their arrogance blinds them to what they are really up against. Don’t let them have your sats. nostr:note1v8g6cswn657e6kkxmv92kncjrfyr48kkv7jugq98pkpqjml6tz6qg4m5ql


You are being robbed by the government and your hard earned money is being funneled to criminals.

https://m.primal.net/KeWO.png


Ok this is pretty cool!

 nostr:npub1xtscya34g58tk0z605fvr788k263gsu6cy9x0mhnm87echrgufzsevkk5s shared an apple podcasts link - I missed it in my main nostr feed - but saw it in Fountain and because of open podcasting even though it was an apple podcast link Fountain can find the episode, show me the playable content card, and let me queue it up and download it!

https://m.primal.net/KVfu.jpg
nostr:note1wq5shmhetlg7kndnwx5uktr2u3fqmegl5xtzwqy6yt4rn4h5wm4qppajlf


nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy your #rip with Tom Luongo was bitter sweet. I lost my dad 41 so I feel the pain you both felt losing a hero.

You two have been pivotal in my #btc and geo political journey & how I am and have delivered that message.
My very successful brother is selling his Co. & he’s going to allocate a share to #btc that would’ve never happened w/out your voices🧡

https://fountain.fm/episode/BqTa7HI5R31W435nLKKY


I had a great time joining Tom Luongo on his podcast last week to discuss bitcoin from first principles, some of the uncomfortable truths that exist within the protocol at the moment, and the correct approach to "selling" bitcoin to others.

https://fountain.fm/episode/BqTa7HI5R31W435nLKKY


They sleep from 7:30-7:30.


I've gotten 9 hours of sleep two nights in a row and I feel like I can take over the world.


Said another way: “The citizens using their freedom of speech on social media sites are more powerful than our propaganda and we can’t have that.”

These despots are really going to hate Nostr when they finally figure it out.

nostr:note1m8y3j99jn28yvqrl6l3zxkgapkwfys6wnsjhxc6yfexg48nnta7sykzx8n


I literally zapped you 20 minutes ago.


They certainly can. And we can call them out, lambast them and point out their Marxist tendenacies.


The New York Times is an actively hostile Marxist media organization operating in the US.

https://m.primal.net/KYtP.png


Just listened to nostr:npub1ath4je07y7py74nvu044fum3f8hz3exc3dtcv782qg94w5gaddusl74k6d and nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy  on TFTC Matthew will be posting more on Noster give him a follow.

https://fountain.fm/episode/ylh1NQhyHXALTd0HzHua


nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy  you remind me of my dad in the early 70’s throwing us off a pier (close to ladder) & watching us learn to swim. Good old days where risk taking was applauded & built resilient, strong adults. Me.
Thx nostr:npub1sk7mtp67zy7uex2f3dr5vdjynzpwu9dpc7q4f2c8cpjmguee6eeq56jraw  @1basemoney gr8 #rip as always 🫡💪🧡💜

https://fountain.fm/episode/ylh1NQhyHXALTd0HzHua


We live in the most interesting point in human history.

There are two paths that lay before us and forces are exerting a lot of pressure in one direction or the other.

The path we ultimately go down depends on the individual.

Will you cave to the totalitarians or will you embrace freedom tech and stand up to the insane people who want to control every part of your life?

The Nanny State will tax, censor and jail you if you don’t take a stand.

Make yourself resilient by embracing freedom tech like bitcoin, Nostr, and other open source software projects while building a strong community in meat space.

We can defeat these despots. It will take many individuals taking action to do so though. Don’t cower in fear. The future of humanity depends on you taking a stand.
https://m.primal.net/KVqA.jpg


RHR 320: LIVE FREE WITH  nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx AND  nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy

https://cdn.satellite.earth/8377cbdb426eeef134bbd557f9fb5a55fa073a98c64016e2994beb4e12a6fe98.mp4


The Cuban Nipple Crisis is going mainstream. It’s about time.
https://m.primal.net/KVTP.jpg


Live now on  nostr:npub1sk7mtp67zy7uex2f3dr5vdjynzpwu9dpc7q4f2c8cpjmguee6eeq56jraw

https://zap.stream/naddr1qqjr2efsvsergdpk95cnydes956rvwf395un2ctr95unjvnyxv6kxvnpx93nzqg4waehxw309aex2mrp0yhxgctdw4eju6t09upzpn6956apxcad0mfp8grcuugdysg44eepex68h50t73zcathmfs49qvzqqqrkvuj2xlcy


And about time to be long-form on nostr!

#25 Base Money Update: 7th Year & Counting

For six full years I've been updating and commenting on the status of global central bank money on Twitter. As the seventh year of my research commences, for 2024 Q2, it's about time to bring it home to the better bird protocol. This is a much more philosophically aligned place to focus in on the signal when it comes to our money, and I'm happy to finally convert these posts to long-form here.

**This is quarterly update #25, for 2024 Q2.**

If you have followed [my work](https://www.porkopolis.io/) before, then you know that the constant hymn I've sung while speaking publicly about Bitcoin is that the only, economically comparable money supply in the fiat world to 21 million bitcoins is what economists call the "monetary base," or "base money." This is a corporeal money supply that has existed across all of modern economic and central banking epochs. For an apples-to-apples, ontological comparison with Bitcoin, look no further then Base money.

## So what is it?

It is *central bank money*, comprised of two supplies:

1. **Physical currency**: Notes and coins, or “cash;”
2. **Bank reserves**: The “Master account” that each commercial bank holds with its central bank.

Now, why do I refer to this as, "Central bank money?" This is because, unlike all other money supplies in the fiduciary banking world (like M1/M2/M3), the Monetary base is the sole and ultimate money supply controlled by the central bank. It is, literally, the *printing press*.

What follows won't be a lesson in reserve ratios or monetary economics. The point is that you simply understand that ***there is*** a money supply that central banks solely control, and of course (of course!) this is what Bitcoin's 21 million are up against.

The monetary base is to the core of the entire fiat financial system, as 21 million bitcoins are to the core of the Bitcoin protocol.

One is open and permissionless, and one is not.

By the way, the monetary base is essentially (though not entirely) analogous to the *total liabilities* of a central bank, so we can (basically) say that the monetary base is the "balance sheet" of each central bank.

**On cash**. Quick notes on the above. Certainly you understand what "cash" is, and it is indeed an instrument that has been fully monopolized by each central bank in each nation around the world--only they can print it. Even though it is true that banks in more free banking societies in the past could freely print and strike notes and coins, the central bank (or state) monopoly has been around for a long time. Kublai Khan was the first to do it 750 years ago.

**On bank reserves**. Don't stress your brain on this too much, but this is the main "settlement money" that banks use between each other, when they want to settle their debts. It is digital now (Fedwire in US, CHAPS in UK), but it doesn't technically have to be, and of course before modern technology took over even a few decades ago, it was not.

These two stacks of retail and wholesale cash, stacks of *central bank money*, are what makes up the **Monetary base**. This is the *printing press*. Only this compares to 21 million bitcoins.

And gold, and silver by the way.

Final note, central bank digital currencies, or CBDCs, which are simply LARPing on Bitcoin's success, are indeed created by central banks, and they are indeed classified as Base money. They are going to be a "third rail." They are thankfully incredibly small, pilot projects today. We will see how far democracies will be tested, as autocracies no doubt will mainstream them; but for now, consider them, at least economically, to be inconsequential to the update below.

With that review out of the way, onward to Q2 update for 2024.

## Bitcoin is the **6th largest money in the world**.

In February 2024, it surpassed the monetary base of the United Kingdom, that is its value was larger than the Bank of England's balance sheet, and it remains so to this day.

As of 30 June 2024, there are four central bank balance sheets larger than Bitcoin:

1. **Federal Reserve (dollar)**: $5.73 trillion
2. **European Central Bank (euro)**: $5.19 trillion equivalent
3. **People's Bank of China (yuan)**: $5.11 trillion equivalent
4. **Bank of Japan (yen)**: $4.20 trillion equivalent

So if we only look at this from a "fiat" perspective, then Bitcoin is indeed the 5th largest money in the world.

However, the all-important monetary metal throughout history that even a child knows about--gold--is still king at around **$15 trillion in value**, or 6.1 billion ounces worldwide. Note, this does not include gold lost/recycled through industry; in that case, it is estimated that about 6.8 billion ounces of gold have been mined throughout humanity.

![](https://blossom.primal.net/21e9bcba7166efbd1f50b48e4bae3650054b864c2358b61dd05ccf9333939193.png)*Update #25 Executive Summary*

Silver, for what it's worth, is still a big "monetary" metal; though it is true, much more silver is gobbled up in industry compared to gold. There are about 30.9 billion ounces of non-industrial silver floating around the world (most of it in jewelry and silverware form) that is valued in today's prices at $930 billion. Bitcoin bigger.

## **State of the Print: $26.1 trillion**.

If we add up the Big Five central banks already mentioned above (again, Bitcoin being larger than the Bank of England's monetary base), as well as the next 45 central banks, we get to a total, USD equivalent value of **$26.1 trillion in base money across the world**.

If we consider $26.1 trillion as the Big Boss of central bank money, the figure in totality, then Bitcoin at $1.2 trillion network value indeed has some way to go. We can also imagine how the Pareto distribution occurs even in money, if Bitcoin after only 15 years is already larger than every central bank money in the world except for four of them. Wild to ponder.

## Inflation: 12.7% per year.

It is also true that for two years they have been trying to "normalize" their balance sheets after the 2020-22 Covid madness, stimulus, and money printing. Of course, they have been trying all along to normalize since the 2008 global finance crisis (GFC), but I digress.

When I first started my website, I vowed never to use such a non-corporeal thing as CPI to discuss how much things cost.  A "general increase in the level of consumer prices," or CPI, as measured by planning boards around the world, is not a real thing.  It may be calculated by people with the best of intentions, but it has been manipulated and volumes have been written about it.  I don't use it.

I have always defined inflation as the classical economists did: Inflation is an increase in the "stock" of money. If we know the all-time stock of euros printed by the European Central Bank now, and we know the all-time stock of euros printed by the ECB 12 months ago, then it is very easy to calculate the annual inflation of the euro.  Not only is it easy, but *it is real*.  It is corporeal.  Watch what they do, not what they say.

But we should be rigorous. If inflation is an increase in the stock of money, what is a decrease in the stock of money? Does this happen? Well, this is *deflation*, and yes it does happen.  You may be surprised to learn that for two years central banks around the world have collectively been shrinking their balance sheets, and thus we have been in a state of deflation.

With my research we can visually see all of this, and it is here:

![](https://blossom.primal.net/7b45c11c9345fbf26fdd44ce7007c737f14a4351d8b4028773d374612b3c1fd2.png)*Inflation, or Deflation?*

Turns out that the normalization is more difficult than they thought, as they are still at $26.1 trillion, and before Covid the global monetary base was $20 trillion.  Nonetheless, they have stopped the money printing of 2020 and 2021.

I have written much about my [methodology for these reports](https://www.porkopolis.io/methodology/), but the bottom line is that the area curve on the left axis (the base money itself, denominated in dollars), will not necessarily reflect what is happening with the actual money print, trailing 12-month % figures on the right axis (the growth rate or inflation rate).  It is a *Wittgenstein's ruler* thing.

The blended, global, annual rate of central bank money printing at the moment is nearly flat, just slightly negative at -0.3%.

The flat levels and the slight rate of deflation have been relatively consistent for the last two years, but if you look at that the 2022 peak of $30 trillion, this may seem like they have cut the supply much more than this.  *They haven't*.  This is because, on balance, ***most of the world's currencies have fallen faster in value against the dollar, even though they continue to print***.

This is why we have seen $4 trillion in base money shed in value over the last couple years of rising interest rates, but the *actual decrease the rate of base money printed* has only been around **-1% to -2% per year**, when measured across each currency's native unit growth, each month.

And for the high signal, no-noise figure in my attempt to get you to one number to understand how much central banks have compounded their fiat base money stack across 50+ years, **that figure is 12.7% per year**.

And Powell says he wants to cut rates (print money) again.  Wild.

## Let's compare.

For the rest of this report, I want to do something different and simply spend some time looking at the compound annual growth rates of various corporeal things around the world, in order that we can compare those to the growth of the fiat monetary base, and Bitcoin.

Remember, most things in the financial and economic world grow exponentially.  This simply means that they grow *constantly*.  The financial term here is compound growth, or compound interest.  This rate of growth can indeed change year to year (interest rates can go up, or down), but over the years we can observe a strong trend, and that is what I want to summarize here for you.

## Population.

The world has grown exponentially at **1.7% per year** over the last 75 years.  However, despite all the overpopulation myths you've probably heard, this rate of growth is actually falling, well below trend, and we only grow at **0.9% per year** at the moment.

## GDP.

The United States has grown its economy at 5.2% compounded per year since the founding of the republic.  We are at the higher end of this trend right now, $28 trillion per year and growing at **5.8% per year**.

## Stocks.

Stocks grow exponentially as well, don't let anyone tell you otherwise.  The growth rate is **7.3% per year** for the S&P 500, the main US index that tracks more than 80% of total market caps.

## Stocks. With Dividends.

If you reinvest those dividends into the same stock market, you'll earn more.  Still compound growth, but 2% higher at **9.3% per year** for the S&P.

## Bonds.

Bonds are supposedly safer than stocks (bondholders get paid back first), and more cash flowing.  If you look at the longest running bond index in the US, it grows at **7.1% per year**, compounded.

## Base Money.

As we've discussed, base money grows, if re-weighting the native unit growth each month, at **12.7% compounded per year**.  However, this trendline analysis looks at it differently.  It simply looks at the USD value of the global monetary base (again, **$26.1 trillion**), and draws an exponential trendline on that USD equivalent growth for 50+ years.  In other words, this is going to be *after all currency fluctuations* have played themselves out.

Do you think the growth rate here will be higher or lower?  Actually lower, at **10.3% per year**.  But there is a big asterisk here, as more base money supplies are added in later periods than in the 1970s and 1980s, so it is not as rigorous as the 12.7% figure.  In any event, one might expect this trendline analysis to *actually be higher* in that case, so it goes to show how quickly currency values can fall against the global reserve currency!

## Silver.

This is total ounces ever mined.  They trend upward at **1.4% per year**.

## Gold.

This is total ounces ever mined.  Gold trends upward at **1.7% per year**.  Faster than silver.  Surprised?  Notice the R-squared (goodness of fit) for both silver and gold.

## Bitcoin.

Bitcoins grow according to a basic logarithmic curve.  Trying to draw percentiles is pointless here, and even measuring a trendline is somewhat pointless, as everyone knows the bitcoins prescribed into the future, by the protocol.  Better to just quote the trailing 12-month growth figure, and it is **1.7% per year** and falling.  For now, identical to gold.

## Silver price.

Since 1971 it's trended at 3.4% per year.  Silver bug?

## Gold price.

Since 1971 it's trended at 5.0% per year.  Gold bug?

## Bitcoin price.

Note, we have finally arrived at something that grows differently than exponential.  As I've observed since 2018, Bitcoin grows according to a power trend.  Did you notice that all the prior exponential trends displayed themselves as straight lines on log scale?  Well, with Bitcoin, the power trendline gradually falls across time, but the growth is still well larger than anything we've covered thus far.

Why?  It's being adopted, of course.

Bitcoin's power trendline has grown **169.9% per year** since Bitcoin Pizza Day in 2010.  Note that this is something akin to a "Lifetime Achievement" figure, and it will continue to fall every day.  Over the prior 12 months ending 30 June 2024, Bitcoin grew **105.6% over the year**.  The compound growth of the power trend today is **45% per year**.  By 2030 it will fall to "only" **36% per year**.

Oh yes, and it is free, open, and permissionless.

## To summarize.

That's a lot of data that came at you quick.  I've compiled it all in a helpful table here for you to review at any time.  This is the world at 2024, Q2:

## Base money concluded

The following table gives you a complete summary of the fiat currencies, gold, silver, and Bitcoin figures used in this analysis, for this quarter.  Please print it out if you like, it is meant to be a helpful, in-depth companion when fiat friends come asking.

Thank you for reading!  If you enjoyed, please consider zapping, and you can also donate to my [BTCPay](https://donations.cryptovoices.com/) on [my website](https://www.porkopolis.io/) if you'd like to help keep this research going.


nostr:npub10pk094sqy5vny5yew9g5kvlnz7xg0355gaq8crunjkydrctuhvwstqr5md slipping.


Long overdue for me, but I am taking these global base money updates to nostr.  Long-form!

https://highlighter.com/a/naddr1qvzqqqr4gupzp6h0t9jlufuzfatxeclt2nehzj0w9rjd3z6hseuw5qst2ag366meqqknydfdgfshxefdf4hkuete942hqerpw3jj6dm5dqk4jetpwgk5xmm4de6xjmn894skz6rzv3jqt4qmv0


Sometimes you have to reconnect with your inner kid and launch the young bucks into the stratosphere. https://video.nostr.build/141986e3dfc20c2539c7795d2f019edf20ee602e9378976980c150ec9dcf4197.mp4


Link would have been helpful:

https://habla.news/a/naddr1qvzqqqr4gupzq2pydthdke720vjsrjm9srwq9jcjkqk24nk37u5mkcv46p3tzz9dqq7xsar5wpen5te0w3n8gcewd9hj7mtpwf68juedvfjkuap0d9ehxat995cnxd3c946x2argv4ez66tn943hyatndp5kueeddyhsjarecg


An example of an article we posted via the bridge earlier this year.


Our bridge pulled in pictures and tweet embeds automatically and the UX of embedding with the Nostr native publishers is very difficult to work with.


Having played around with Highlighter and Habla over the last few days, I still think one of the most high leverage things that can be done for long form content on Nostr is a simple bridge from other publishers like Ghost

 nostr:npub1xutvgwfupqsu82r6fj76mulqaeccuc9tsu0dek7hu9da08fr2l2qxxqt6l built this for TFTC with Scribsat last year but we haven't been working on that for quite a bit and the bridge broke. It was incredible while it was working.

Devs, plz help.


Very short but powerful rip. Thank you to  nostr:npub1qg8j6gdwpxlntlxlkew7eu283wzx7hmj32esch42hntdpqdgrslqv024kw and  nostr:npub1klkk3vrzme455yh9rl2jshq7rc8dpegj3ndf82c3ks2sk40dxt7qulx3vt for joining us and all of the freaks who packed out the Cypherpunk Stage.

nostr:note1pde2leu769zv9uxae9hvgtz09f3mlrgcp995aqcdx0lqldcp576q7lht76


The Regime lapdogs that refer to themselves as journalists are some of the most repulsive people living on this planet.
https://m.primal.net/KTuO.mov


There is a real lack of understanding in just how fucked up the algos are, and how much power we gain in not being manipulated by them. We could be using the internet to do something extraordinary, and instead it is being used primarily to sell us shit and keep us scared. The whole of humanity is being fed lies and distortions through centralized social media that is designed to keep everyone asleep and unaware of their real power.

Now that there is no longer gatekeepers to what can be said to a global audience we have the power to shape a real unadulterated narrative; also known as the truth. The power of censorship to have molded a false global narrative is one of the pillars of the power structure that keep people divided over petty and impractical differences that can now be shown for what they are: manipulation tactics through the algos to keep everyone disempowered. We now have the ability to reclaim our voices in a way that no one can stomp out. What is to come and the changes that are to be ushered in will surprise all of us in the most remarkable of ways.


“Democracy”
https://m.primal.net/KSsM.png


SATS FLOW - z16a KILLER

https://m.primal.net/KQzb.mp4


Don’t underestimate the power of instilling confidence in others. Help people understand that they have power and agency. Bitcoin and Nostr are tools. Confident people leveraging these tools is what we need.


This is why we bitcoin. Bitcoin gives people the ability to store their wealth in an asset that is extremely hard to confiscate if secured properly. Bitcoin gives you leverage from which to fight back against this type of overt Marxism.

nostr:naddr1qvzqqqr4gupzq3e0gs8jnmued6f2rp4c6vs07xqvs4vs8zpwt82smcdch4txjvq7qqxnzdejxsursdpjx5erwvfhy8v24n