Leonard H.’s Post

The authors analyse the drivers of Bitcoin transactions against 44 fiat currencies in the largest peer-to-peer crypto exchanges. Momentum and volatility in the #cryptoassetmarket, as well as volatility and liquidity in global financial markets do matter for Bitcoin trading. There is suggestive evidence of a global #crypto cycle driven by speculative motives. However, in emerging and developing economies (#EMDEs), Bitcoin seems to offer also transactional benefits, since trading increases when the value of the domestic currency is unstable. Proxies of banking depth and digitalisation are negatively correlated with the currency loadings on the global factor, indicating that #cryptoassets may offer a speculative alternative to traditional finance when this is not available, especially in EMDEs where the share of younger risk-prone population is higher. Their results clearly point to potential #financialstabilityrisks from #cryptoisation in EMDEs with low levels of financial development and unstable fiat currencies. #digitalcurrencies #Bitcoin #peertopeerexchanges #financialdevelopment #volatility #liquidity #financialmarkets #banking #digitalisation #finance

BITCOIN SHORT II. BIS PAPER FROM NOVEMBER 2023 ON STABLECOINS: THE CONDUIT IS IMPAIRED In this episode we review the state of the plumbing to bring flows into #Bitcoin using the BIS paper on stablecoins from November 2023. The Crypto currencies are mostly worthless, and the argument of scarcity and hoarding can not be applied to a currency that has no utility as a commodity. (food or ornaments) It is nothingness like fiat but without a government to force its use, and only through forced use do "nothingness" currencies acqurie value (John Fullarton). But the transaction usage is very low.Looking through the BIS paper there is a problem of liability side of stablecoins, unable to cope with outflows (unlike banks that can swap deposits with CDs and repo). In other words the RRP drawing and deposit outflow's problem is exponentially higher for Stablecoins that are the conduit to go into Crypto currencies, while the implied probability of approval is divorced with the regulators' hostility. PLAY 📺  the Graph in augmented web. 👉 https://lnkd.in/djwg2iJy

I've (mostly) shied away from saying this over the last 5 years... But I strongly think Bitcoin will be one of, if not THE, global reserve currency. I wanted to wait until the regulatory risk was minimized before saying it publicly and to investors on calls. I personally think in 10-20 years the world will operate on less than 5 currencies (hundreds today). The Dollar and Yuan will still be around (98% confident). Slightly less confident in the Yen or Euro (85%). But Bitcoin will be in there too I think (75%). In this world Bitcoin is easily trading over $1m. Could Bitcoin be the biggest among them? It's likely in my view. It's the only one of the group that doesn't have a country running the money printer. And it's the only one that preserves your purchasing power over time. Those are insurmountable competitive moats.

Remember when #LarryFink's remarks on #BTC made people ponder upon the shift of the asset from a store of value to a medium of exchange ? Well, now #MichaelSaylor has come forth to further crystalize the idea of #BTC's monetary transitionary phase, i.e, towards becoming a Unit of Account! (that is huge) He supposes that billionaires across the globe are going to hoard as much #BTC as they can, as they have seemingly begun realizing the superior store of value attributes of the asset. So, what does all this mean ? What it could mean (from the point of view of economics), is that there would be an incredible surge in demand for BTC, however, due to the limited supply of 21 million BTC's it would end up making the asset supremely valuable. Now, if #Bitcoin's value rises dramatically against #fiat currencies, the exchange rate would become so large that it would be unwieldy to use fiat currency as a unit of account for Bitcoin. And as the adoption of Bitcoin becomes more valuable and widely held, it might start being used as a unit of account in its own right. This means goods and services could be priced directly in Bitcoin rather than in fiat currency. BOOM, Unit of Account Status! But, what happens when all of this starts causing a mass undermining of confidence within #FIAT currencies? Could this cause an actual paradigm shift in the way financial markets function ? Or re-shape the way investment strategies, and economic policies would work worldwide ? #byebyeFIAT #allhailBTC #defi

BITCOIN IS A REAL STORE OF ASSET VALUE, BUT IS IT? It's been said so many times that now, it's become one of those things you know but don't know how you know it. It's like one of those unwritten rules in the gym. But on the flip side, is it really? This will sound like a lot of mumbo jumbo but just walk with me. For something to be said to be a store of asset value, it has to meet certain criteria which include: ✅ It derives its innate value from its utility. ✅ It isn't affected by the rally and dump of currencies. ✅ The value of currencies are determined by how well they do against it. This looks like a lot of grey areas and vague terms but it's not. Let's look at the Gold. ✅ It has innate value in itself as a precious metal. ✅ A dump in the dollar or pounds doesn't imply depreciation in it's actually value, it'll just pump against it so it's not affected by the dollar inflation. ✅ It's a reserve asset, the Great Britain Pounds gets it's name from it's pound worth of gold. But unlike gold, whenever the dollar dumps, bitcoin retains its value in the dollar but its actual value is reduced because what it's tied to isn't inflation proof. Am I saying you shouldn't buy bitcoin? No, that'll be the demons of your father's house counselling you. I'm just saying we should use the right terms and not click baits. Thank you PS: Hitting the Market's Curve Ball begins tomorrow so stay giggy! #techies #blockchain #crypto #bitcoin #finance

We've all heard of "The Bitcoin Standard" the initial cornerstone and foundation of understanding Bitcoin. But did you know Saifedean wrote another book? (Pic related) I think I'm well versed in the pitfalls of fiat currency and holding it as a store of value, but now I kind of want to read this as well. Paradigms are changing fast these days. It seems like many of the systems used to keep people misinformed are actually backfiring and doing the opposite. Systems are shifting, narratives from the old guard are making a 180, previously accepted truths are being challenged and dismantled, and enlightenment is happening globally about many of these things. Even gold and silver are currently at new highs. People are just dumping cash it seems, only keeping what they need to pay bills and such. Countries suffering from hyper-inflation are jumping to whatever safe store of value they can find. Many of them only being able to withdraw a small amount of fiat per week or per month. May we live in strange times indeed. Enjoy the week! Did you know Gilded Pendulum accepts goldbacks as consultation payment? They've recently doubled in value. I always advocate for harder forms of money. Find me here 👉 TryGilded.com

BTC New Reserve Currency!? Crypto adoption is driven by three main reasons: for fun, speculation, and out of necessity, especially in regions with devaluing fiat currencies or strict capital controls. The International Monetary Fund (IMF) published a report titled "A Primer on Bitcoin Cross-Border Flows," indicating a growing concern over Bitcoin's use in cross-border transactions. The report highlights the difficulty in precisely measuring BTC transactions due to its pseudonymity and off-chain transactions, but suggests that cross-border BTC transactions are distinct and identifiable. Cross-border BTC transactions are larger on average and are increasingly used for remittance and evading capital controls, prompting IMF scrutiny. The report suggests that BTC's adoption and evolution pose challenges to traditional financial systems, potentially leading to future policy responses and regulatory actions to manage capital controls and stabilize domestic currencies. #CryptoAdoption #IMFReport #BitcoinCrossBorderFlows #CapitalControls #FinancialSystemChallenge #RemittanceRevolution #RegulatoryResponse

📊 **Bitcoin's Implied Volatility Higher in 2024, Reflecting Speculative Environment!** CryptoSlate's analysis shows that Bitcoin's one-week implied volatility (IV) in 2024 has been higher than in 2023. The IV remained around 50% after surges in early January and mid-February but spiked to over 80% during the April halving. This heightened volatility, influenced by the regulatory environment and macroeconomic conditions, suggests increased market uncertainty. Foreign media noted that although volatility briefly decreased after the halving, the current levels indicate a speculative trading environment. 📈⚠️ #BitcoinWorld #CryptoAnalysis