Bridging off today’s GMC conversation of central banks possibly investing in bitcoin for it to become the world’s reserve currency:
On the flip side, governments and banks may decide they don’t want bitcoin as the reserve currency and they want to maintain fiat or some other standard, perhaps distribute their own crypto, even use ripple since it already has partnerships with banks around the world, who knows right? Probably something they can control the code of anyway, for obvious reasons. I know Ivan has discussed this a lot on the show before, I suppose it’s a daily topic in a sense really, including today. He was talking about ETH today and governments having their own side chains for example. I think the topic becomes more relevant as time goes on and crypto grows, so I was wondering if he could talk about it more specifically rather than generally?
What does Ivan (and your hivemind) think would be the most likely mechanism for “them” to make this happen? Is there a traditional fintech person he could interview on this topic? Perhaps PlanB could come on the show anonymously?
It’s definitely logical to expect this play as the crypto space gains traction and threatens the current power structure. Those in power would simply want to seize control of the bitcoin economy themselves or ensure it doesn’t overthrow theirs’. Given the decentralized nature and size of the network now this is definitely no simple task, I understand that. However the motivation will be there if the totalitarian regimes find they are losing control of their wage slavery system. I suppose each day that goes by where the network quietly grows and develops while they do not respond to it out of complacency works in decentralizations’ favour, wouldn’t you say?
I was previously aware that at one time the FBI held the (or one of the) largest recently active bitcoin wallet(s) from the silk road seizure. I now read that they auctioned the wallet off in pieces to different investors so that changes my idea a bit but not that much. I was thinking if “they” didn’t want to adopt bitcoin, they could flood the market with supply and crash the price, perhaps low enough to make the network nearly irrelevant, and offer their own alternative of course, simultaneously. Obviously this would be easier for them to accomplish if they still had the silk road BTC but since they don’t, they would have to reclaim it. This could also be simple for them to accomplish given they know who the current owners of the coins are. I would say China could exercise a similar play or even in a coordinated effort by seizing the binance wallet, etc. Perhaps they would just confiscate the coins to adopt the network and distribute them as they see fit, manipulate the market as the whales do now. Within the crypto news sphere they would never get away with this of course, we would see it happen. After all it is publicly available information on the blockchain. Thinking about these kinds of scenarios really makes a person concerned about privacy with respect to how much BTC and other crypto they hold, especially in large amounts now.
I think the dominance chart is interesting: https://coinmarketcap.com/charts/#dominance-percentage
I know Ivan doesn’t like coinmarketcap but I think the chart linked above is still relevant. BTC loses a lot of dominance during the bull markets, and it’s plain to see a downward trend in BTC dominance since the beginning. Do you think this is a problem for BTC in the long run should the trend continue?
The market mechanics of this are difficult to ponder and innumerable scenarios could play out. I suppose it’s a conspiracy theory rabbit hole, we could talk about it until the cows come home. I expect Ivan (together with his team) would make some interesting points on the topic though and I would love to hear his thoughts tomorrow or this week. What do you think?
I look forward to seeing where this topic takes us.