On a recent episode of the Galaxy Brains podcast, Michael Saylor made the case that bitcoin isn’t a forex and that it’s best possible to think about it as capital and capital handiest.
He additionally shared that Tether (USDT) and Circle’s USD Coin (USDC) are the true virtual currencies and unveiled his “evil genius strategy” (his personal phrases) to get the sector to undertake the U.S. greenback stablecoins versus bitcoin.
On this Take, I’ll cite a few of Saylor’s personal phrases from the podcast ahead of breaking ailing why most of the issues he made are off bottom.
Capital, Now not Forex
“It’s not a currency, it’s capital,” stated Saylor about midway throughout the episode.
“You just have to come to grips with it — it is not digital currency. It is not cryptocurrency. It is digital capital. It is crypto capital,” he added.
I searched the Bitcoin Whitepaper to look how time and again the pledge “capital” confirmed up.
It isn’t discussed as soon as.
On the other hand, in each the name and summary of the textual content, bitcoin is known as “electronic cash.” Moment money can after all even be capital, it’s now not handiest capital. To consider bitcoin handiest as capital is to disclaim sure of its maximum very important houses — like the facility to utility it to transact with somebody anyplace on the earth permissionlessly.
To disclaim bitcoin as a forex is to disclaim a massive a part of its worth proposition. Bitcoin’s roles as a Pack of Worth (SoV) and a Medium of Trade (MoE) are inextricably connected. For extra in this, I’d advise you (and Michael Saylor) to learn Breez CEO Roy Sheinfeld’s piece “Bitcoin’s False Dichotomy between SoV and MoE”.
Because the episode proceeded Saylor persevered to (poorly) assemble the case for why bitcoin is capital and now not forex.
“There are a lot of maxis who are like ‘No, we want it to be a currency. We want to be able to pay for coffee with our bitcoin. Pay me in bitcoin,’” he stated. “It’s like ‘Pay me in gold. Pay me in a building. Pay me with a slice of your professional sports team. Pay me with a Picasso.’”
It’s if truth be told now not like that in any respect.
Positive, bitcoin is scarce, rather like gold, Long island actual property, sports activities groups or well-known art work, nevertheless it has quite a few alternative houses that assemble it some distance other from any of those alternative belongings.
For example a field of that time, I’ll cite my associate Alex Bergeron:
I ask over somebody who thinks Bitcoin is like gold to establishing a custodial gold pockets.
I’ll wait.
— Alex B (@bergealex4) December 22, 2024
And nearest Saylor cited — look ahead to it — Fed Chair Jerome Powell’s tackle bitcoin in efforts to force house his level that bitcoin is capital, now not forex.
“The reason bitcoin rallied past $100,000 is because Jerome Powell on stage said to the world, bitcoin does not compete with the dollar, it competes with gold,” he stated.
Oddly plenty, Saylor stated this with out acknowledging that the person who stated that is the top of the establishment that Bitcoin will have to theoretically change.
USDT, Now not BTC
Within the interview, Saylor additionally drove house the purpose that the true virtual currencies are U.S. greenback stablecoins.
“The cryptocurrency, the digital currency, is Tether (USDT) and Circle (USDC),” he stated. “It’s a stablecoin U.S. dollar — that’s the digital currency.”
That is once I began to get nauseous.
For individuals who don’t but know this, Bitcoin got here into the sector within the wake of the Splendid Monetary Disaster of 2008, when the U.S. govt together with the U.S. Federal Keep chosen to print U.S. bucks en masse (reduce the forex) to bail out failing banks, the load of which was once laid each at the U.S. taxpayers and U.S. greenback holders international.
Bitcoin is a decentralized cash that was once created as an supplementary to the U.S. greenback and all alternative fiat currencies. Seeking to persuade folk that bitcoin isn’t that is disingenuous at best possible, deeply manipulative at worst.
However this isn’t even the worst of what Saylor needed to say at the episode.
He went directly to suggest that the banks that were given bailed out within the 2008 monetary extremity factor their very own stablecoins, which might support prop up the U.S. debt marketplace.
“They ought to just create a normal regime to issue digital currency backed by U.S. treasuries,” stated Saylor.
“The U.S. ought to have a framework so Tether relocates to New York City. That’s what you want, right? And then you ought to basically have a free-for-all where JP Morgan or Goldman Sachs can issue their own stablecoin,” he added.
Disagree, Michael Saylor, that’s now not what I would like. In reality, it’s very some distance from what I would like.
I don’t need Tether anyplace close Fresh York Town (my place of birth) and I don’t need JP Morgan and Goldman Sachs issuing U.S. greenback stablecoins that they keep an eye on, necessarily the similar of CBDCs.
Once I take into accounts Goldman Sachs, the very first thing that involves thoughts is award-winning editor Matt Taibbi’s description of the establishment from his Fresh York Instances bestseller Griftopia.
“The first thing you need to know about Goldman Sachs is that it’s everywhere,” started Taibbi within the retain. “The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”
Goldman Sachs, just like the U.S. Federal Keep, is an establishment that sucks the week power from humanity. Bitcoin was once designed to hurry energy clear of such establishments, now not give a boost to them.
Towards the tip of the episode, Saylor laid out his grasp plan for bitcoin and U.S. greenback stablecoins.
Right here it’s:
“Everybody outside the U.S. would give their left arm to be capitalized on U.S. bonds. So, my strategy would be — and I really think it’s an evil genius strategy; it’s so good that our enemies would hate us, but our allies would complain, too. And the U.S. would make $100 trillion in a heartbeat.
Here’s the strategy: You dump gold, demonetize the entire gold network. You buy bitcoin — 5 million or 6 million bitcoin — and you monetize the bitcoin network. All the capital in the world, sitting in Siberian real estate or Chinese natural gas or every other currency derivative that’s held as a long-term store of value — Europeans, Africans, South Americans, Asians, they all just dump their crappy property and their crappy capital assets and they buy bitcoin. The price of bitcoin goes to the moon.
The U.S. is the big beneficiary. U.S. companies are the big beneficiary. And while you’re doing that, you normalize and support digital currency, and you just define digital currency as the U.S. dollar backed by U.S. dollar equivalents in a regulated U.S. custodian that’s audited. What happens next?
$150 billion of stablecoins goes to $1 trillion, $2 trillion, $4 trillion, $8 trillion, probably somewhere between $8 and $16 trillion, and you create $10 to $20 trillion of demand for U.S. sovereign debt.
While you’re taking away a little bit of the demand because the capital asset of bitcoin grows, you’re adding back the demand to back the stablecoin. [The digital U.S. dollar then] replaces the CNY, the Rubble. It replaces every African currency. It replaces every South American currency. It replaces the euro.
If you really believe in U.S. world reserve currency and U.S. values, every single currency in the world will actually just merge into the U.S. dollar if it was freely available.”
At this level, I ended paying attention to the episode and projectile vomited far and wide the Fresh York Town subway automotive wherein I used to be sitting.
I didn’t come into the Bitcoin area to support the U.S. run a scheme wherein it acquires a massive share of the bitcoin day hooking the sector on its trash forex, and it deeply saddens me that any individual that many within the Bitcoin area glance as much as would get a hold of this type of conniving plan.
Bitcoin Is Cash
Bitcoin is cash. It’s a kind of cash that can not be censored or debased that has spectacularly grown in worth over the era decade, making it certainly one of, if now not essentially the most, robust device ever created for people.
To consider it as the rest much less, or to effort to persuade folk {that a} unutilized iteration of an incumbent model of cash is best than it, is to be deeply misinformed.
Moment bitcoin is capital, that’s now not all it’s, and please don’t let Michael Saylor or somebody else persuade you differently.
This newsletter is a Take. Reviews expressed are fully the creator’s and don’t essentially replicate the ones of BTC Inc or Bitcoin Album.
