Bitcoin is a Tradfi Asset now \ stacker news ~bitcoin

4473 sats \ 32 comments \ @grayruby 13 Jun bitcoin

zaps forwarded to @anita (25%) @geyserfund (25%)

I know. I know. Bitcoin is for everyone.

I know. I know. Bitcoin is for enemies.

I know. I know. Bitcoin is permisionless.

And so on.

Disclaimer: Don't shoot the messenger. This is not an opinion piece but maybe an observation piece and a bit of forecasting of what I expect will happen in the coming years.

With the introduction and demand for US based bitcoin spot etfs, the demand for usage of bitcoin CME futures to play fiat cash and carry trade games, and the adoption of Bitcoin as a treasury reserve for public companies, Wall street and Bitcoin are becoming ever more intertwined.

https://m.stacker.news/35206

This relationship is most certainly good for the Bitcoin fiat price over the long term and likely takes the regulatory risk of an outright ban in the US off the table. It is good for "adoption" if your definition of adoption is Bitcoin as an ever growing allocation amongst a larger portfolio of assets.

I am amendable to the idea that Bitcoin could be a trojan horse that slowly takes over the traditional system from the inside. I am also amenable to the idea that the opposite might happen and Bitcoin may ultimately be just another tradfi asset. Either way time will tell.

In the short to medium term (say the next 5-15 years) I expect the divergence between the way Bitcoin is adopted in "emerging" or "volatile" nations and "wealthy" nations to continue to exacerbate.

Adoption Model A:

Emerging and volatile nations are likely to continue to adopt bitcoin as a lifeboat from political instability, war, fiat hyperinflation. I expect more nations will test a version of the El Salvador model, more Bitcoin communities like bitcoin beach etc will pop up, Bitcoin will be used peer to peer, as a medium of exchange as well as a store of value more broadly.

Adoption Model B:

Wealthy nations are likely to continue to adopt Bitcoin as store of value asset that is part of a broader portfolio. I expect we will see much more corporate treasury adoption, bitcoin added to the portfolios of most pension funds, endowments etc and possibly even central banks eventually. A robust tradfi options market will develop, big banks will be permitted to custody Bitcoin and it will begin to be utilized as one of the primary collateral assets by wall street and retail alike. You will borrow against your Bitcoin and be happy.

I have to add a not so small caveat to adoption model B. This is dependent on the fiat can being able to be continually kicked down the road. If something really breaks in the bond market or with the US dollar then all bets are off and Bitcoin as a lifeboat likely kicks in.

Ultimately, I think the diverging adoption models are both bullish for Bitcoin and I am hopeful that eventually the participants in adoption model B dig in and learn about what they own. However, I am somewhat concerned that in adoption model B the people who need Bitcoin the most will be on the outside looking in as wall street, corporations, institutions and high net worth individuals gobble it all up for themselves. While good for the wealth of early adopters it would be unfortunate if current generation and coming generations of people who need Bitcoin the most end up with CBDCs, memecoins and shares of the next gamestop instead. So, let's not stop educating the next generation of bitcoiners- we have souls to save!

Thanks for reading.

Sats for all, GR

view all related items

243 sats \ 4 replies \ @Undisciplined 13 Jun

In this divergence scenario, it doesn't seem like Americans or those from the lesser developed nations would be stuck on the outside looking in. If Model A is operating somewhere, then Bitcoin should be accessible to pretty much anyone in a wealthy country.

I think the issue is that those living under Model B don't feel the necessary pain to bother with Bitcoin. Our fiat works pretty well as a medium of exchange, but it's a terrible store of value, so most of our fellow countrymen will only really want Bitcoin for its store-of-value property.

115 sats \ 3 replies \ @grayruby OP 13 Jun

I think this is fair. Also I think in developed nations you need a lot more bitcoin to protect and preserve your living standards than you do in emerging markets and if more circular economies crop up in these emerging markets hopefully that comes with opportunity to earn bitcoin for work as well.

240 sats \ 1 reply \ @cyberpunk02 13 Jun

Also I think it in model B the "developed" economy itself is significantly propped up by fiat and therefore more of the development is revealed to not be useful with wide spread adoption of bitcoin. This distinction of A and B scenarios can also be expressed based on a continuum of fiat dependancy. The less reliant on fiat a country or a person the better and scaling solutions improve the reliance ratio for everyone.

For fiat poor nations scaling helps for adoption now. For fiat wealthy, bitcoin scaling and local circular economies are protection against real risks which could even tip the lifeboats.

21 sats \ 0 replies \ @grayruby OP 14 Jun

Well said

20 sats \ 0 replies \ @Bell_curve 14 Jun

Dollars are more practical in emerging economies. Hence the popularity of tether

261 sats \ 1 reply \ @cristaiji 13 Jun

We’re living through such interesting times. And I’m optimistic either way as I think those that really want to use Bitcoin will find a way and hopefully we’ll be able to help them.

For me the other question is to what extent the big players, banks etc, will be able to manipulate the price of bitcoin? Or will it be mainly what we currently see, the day to day volatility and over the longer term bitcoin will do its thing regardless.

21 sats \ 0 replies \ @grayruby OP 13 Jun

Bitcoin is difficult to manipulate without blowing yourself up but only if a large number of people self custody.

151 sats \ 7 replies \ @Coinsreporter 13 Jun

Nothing can inspire me to sell my stack to some fucking money hoarder at any time. I will wait until use my sats as and when the Bitcoin Standard prevail. Or would die with a dream, at least the dream would be mine...

Ahhh! Couldn't help my fingers type that... But I know most of the Stackers think the same...

150 sats \ 6 replies \ @bitties 13 Jun

A lot of people can’t afford to think this way. I have had to sell due to unforeseen circumstances before. Shit happens.

All I could do was buy it back as fast as my wallet would let me.

82 sats \ 0 replies \ @grayruby OP 13 Jun

Just stack what you can.

52 sats \ 1 reply \ @freetx 13 Jun

Yea, just treat it like savings.

Save as much as possible and spend out of savings when you need to....then continue saving.

31 sats \ 0 replies \ @Bell_curve 14 Jun

90/10 allocation

111 sats \ 0 replies \ @Coinsreporter 13 Jun

You're right. I have also done it before but I bought in once again once I came out of the trouble.

70 sats \ 1 reply \ @zapsammy 13 Jun freebie

only give sats to bitcoiners who get it. they can help u pay the bills in return for sats. do not give it to stupid bitcoiners and especially not to the exchange. there are many of those. only trade with freedom maxis.

i call it 2nd party custody

bitcoin friends will keep those sats safe, and even if you end up with zero sats one day, thru friends who still care about u, u will have the power of bitcoin available to u.

20 sats \ 0 replies \ @grayruby OP 13 Jun

Good advice.

71 sats \ 3 replies \ @cryotosensei 14 Jun

I think it will take more than 5-15 years for Model B to happen. It will be interesting to see how countries roll out CBDCs, as well as which nations will persist in their use of CBDCs n which other countries will pivot to Bitcoin. I think a longer runway is needed for Model B to take flight

My two sats’ worth

50 sats \ 2 replies \ @Bell_curve 14 Jun

I don’t expect any country to make bitcoin only legal tender.

I think El Salvador will be the model for nations adopting bitcoin. Bitcoin and their fiat currency as legal tender because bitcoin is not a feasible medium of exchange right now.

El Salvador has no central bank. They are a dollar economy. This is better than having their own currency.

Emerging markets should ditch their own currency and adopt dollars or euro which will facilitate bitcoin adoption in the future

21 sats \ 1 reply \ @grayruby OP 14 Jun

They would probably do the bitcoin and stablecoins. You are right.

50 sats \ 0 replies \ @Bell_curve 14 Jun

We see this in Latin America which is why Aqua wallet is popular there

71 sats \ 3 replies \ @SatsMate 14 Jun

It is a tradfi asset, but I think it is important that bitcoiners do everything they can to keep innovating and educate and spread base chain adoption.

Also, We need to study the latest innovations in quantum computing - I read recently that someone was able to crack a type of quantum computing hash or something. Point is, we need to be ready willing and able to make the appropriate measures in case SHA256 were to ever be solved.

21 sats \ 2 replies \ @grayruby OP 14 Jun

Yes at some point we will need to adopt quantum resistant cryptography.

50 sats \ 1 reply \ @Bell_curve 14 Jun

Is NVDIA working on this?

21 sats \ 0 replies \ @grayruby OP 14 Jun

They announced something in quantum computing recently.

71 sats \ 0 replies \ @siggy47 14 Jun

I'm always busy with real world crap when interesting posts pop up. Good one, as usual, @grayruby. I like your a, b analysis. Looking at it this way makes it less of a battle between visions. It's not a zero sum game or contest. Also, I'm glad your sat split went to the "b" group!

53 sats \ 0 replies \ @BitcoinAbhi 14 Jun

El Salvador adopted Bitcoin as an official currency; Salvadorans mostly shrugged. In an effort to boost financial inclusion, El Salvador made Bitcoin an official currency and offered incentives for adopting it.

Soon or later I believe every country will adopt it.

A robust tradfi options market will develop, big banks will be permitted to custody Bitcoin and it will begin to be utilized as one of the primary collateral assets by wall street and retail alike. You will borrow against your Bitcoin and be happy

I also believe it will treat like an asset in future.

62 sats \ 0 replies \ @IamSINGLE 13 Jun

Yes, with all the conspiracy by big players, they are aiming to hold on each sat. Beware!

I like the adoption model 1 which is poltically run but only when it allows citizens to hold any amount of Bitcoins.

50 sats \ 3 replies \ @riberet19 13 Jun

Whatever the case, I stay in Bitcoin, although I would rather option A be the one that prevails.

41 sats \ 2 replies \ @grayruby OP 13 Jun

Option A and B can happen at the same time in different places but yes hopefully eventually A prevails everywhere.

20 sats \ 0 replies \ @Bell_curve 14 Jun

Fiat will be medium of exchange for the foreseeable future because bitcoin value will increase in the present and future.

I suspect many bitcoin holders only sell to pay their bills in dollars or fiat or they keep a small fiat reserve for daily expenses

20 sats \ 0 replies \ @riberet19 13 Jun

although I see it more likely because of how events are unfolding that it is the B that prevails, in any case, better to be inside than outside.