January 12, 2018
“Why Bitcoin?” Is a question a lot of people ask themselves when researching cryptocurrency markets. Why is everyone always focused on Bitcoin, while there are so many other investments available? It’s because decentralization made bitcoin much more valuable, it’s not even a competition. Many other coins have claimed to be a ‘better bitcoin’ because they boast some improvement in their protocol or code. This however is not true due to the nature in which bitcoin was launched.
Fraud by bankers
When Bitcoin was founded by Satoshi Nakamoto, it was a response to the 2008 financial crisis. The big banks got bailed out by money from the taxpayer. Banks loaning money to people who couldn’t afford to pay their debts earned massive profits, but still needed a bail out to keep the system afloat. If the economy goes down the drain, the taxpayer can simply be debased by printing more money saving the bankers on Wall Street. The knowledge of this action causes risk taking to pursue ever increasing profits. How many bankers went to jail after the latest financial crisis?
When corona happened, even more money was printed. Not because there was widespread fraud by bankers but because the government decided the economy had to be locked down. Just print more money and keep everyone at home.Nobody will notice, prices will gradually rise and homes more unaffordable for the everyday worker.
To paraphrase Michael Saylor, the CEO of MicroStrategy: “Well meaning physicians bled George Washington to death (taking 40 percent of his total blood volume) with the intention of helping him, but making him die to a throat infection“. Was taking blood from the president a smart idea? Probably not, it did nothing to help his condition. In fact: it may just have killed him. Government printing of FIAT currency does the same thing and when the money supply expands rapidly, our economy starts showing cracks. Since recently the global central banks have started hiking interest rates, what this means is essentially an end to ‘cheap money’ and debts. Those companies once able to fund their operations with debts to ‘grow to scale’ can no longer do this and face bankruptcy. The date is 15 of march 2023, three American banks have collapsed due to a modern day bank run, in part due to high inflation in combination with high interest rates. What happens next will probably be good for bitcoin.