Cryptocurrencies

[TwoCitiesCapital]

1 hour ago, Buckeye said:

With Bitcoin currently priced around $105,000 USD and approximately 19.87M Bitcoins in circulation, the Bitcoin “Market Cap” is ~ 2.2T. If every BTC holder decided tomorrow that they wanted to cash in their Bitcoin, how much of that 2.2T is actually available to be paid out as cash? I would assume all 2.2T, correct? And if there is a difference between the 2.2T and how much could actually be cashed out, what’s happened to the difference?

 

26 minutes ago, Buckeye said:

Not trying to prove anything, just wondering out loud. Obviously the example is extreme, but it still seems like a valid question/thought exercise. I can see the obvious difference between Apple/Brk and BTC because that’s a little like comparing apples to oranges.

 

So it sounds like there may not be $105,000 of cash backing every Bitcoin? Am I understanding that correctly? 

 

There is no asset that you buy that has "cash" backing it for the price you paid. Not treasuries. Not stocks. Not Bitcoin. 

 

When you give someone $105k to buy a Bitcoin - they aren't them holding that money in reserve to "back" the value or to give it back to you when you decide to cash out. 

 

The value is at $105k right now because that is the price that compels those with it to sell to those that are bidding for it and both have agreed that is the right price. Just like any other commodity (and basically and short- and intermediate- pricing of stocks). 

Edited June 13, 2025 by TwoCitiesCapital

[gfp]

I can't tell if Buckeye is for real or not.  This is bizarre logic.  Maybe they are confusing Bitcoin with some type of Stablecoin where there is an issuer and a bank deposit asset / bank deposit liability situation?  Or maybe they are just messing with you guys.

 

There is certainly zero cash "backing" my purchase of Gold at $3400 an ounce.  My $3400 goes to the seller of the ounce of gold.

[Milu]

2 hours ago, Gregmal said:

I think the overriding logic is that there's different rules for "real" assets, and "fake" assets. Same way Tesla having a few years of trading sideways is "evidence" of the jig being up, but Fairfax have a lost decade was just part of "investing".

Yes, it is fascinating the mental gymnastics that people put themselves through with certain topics. There are certain things seen as good (Buffett, Munger, Democrats, value investing) and certain topics seen as bad (musk, trump, republicans, bitcoin, high PE stocks). If Buffett says that the deficit is too high and needs to be cut, because he is in the ‘good’ pile then it gets treated as a very reasonable position from an intelligent person, if musk or trump says the exact same thing then they get slated. 
 

Macron holds miltary parade then it’s ‘a nice bit of pageantry ‘. Trump does it then it’s ’US decending into dictatorship’. 

 

Both sides do it to some extent as we are all flawed humans with our own set of biases. 
 

I try to learn from both sides, buffet and munger is where I learned most about business, investing, and ethics. But then I am also a big proponent of Tesla and bitcoin so its not like I take everything they say as gospel. They are human beings not gods.

Edited June 13, 2025 by Milu

[Gregmal]

Ripple is again(second time in 6 months) tendering for 5% of shares outstanding at $175 per share or a roughly $25-30b valuation. Gift that keeps on giving 

[rkbabang]

Every single Bitcoin is backed by Bitcoin.  Just like every ounce of gold is backed by gold, every dollar is backed by a dollar, and every acre of land is backed by an acre of land.   If you buy a house today there is no guarantee that you get what you paid for it next week or next year in dollar terms.  Nothing backs any hard asset other than the asset itself.

[Buckeye]

5 hours ago, TwoCitiesCapital said:

 

 

There is no asset that you buy that has "cash" backing it for the price you paid. Not treasuries. Not stocks. Not Bitcoin. 

 

When you give someone $105k to buy a Bitcoin - they aren't them holding that money in reserve to "back" the value or to give it back to you when you decide to cash out. 

 

The value is at $105k right now because that is the price that compels those with it to sell to those that are bidding for it and both have agreed that is the right price. Just like any other commodity (and basically and short- and intermediate- pricing of stocks). 

Ok this makes sense, thanks for your reply. I was not thinking about Bitcoin correctly. Wasn’t a troll or a gotcha, just a thought I was having. Thanks. 

[Buckeye]

2 hours ago, rkbabang said:

Every single Bitcoin is backed by Bitcoin.  Just like every ounce of gold is backed by gold, every dollar is backed by a dollar, and every acre of land is backed by an acre of land.   If you buy a house today there is no guarantee that you get what you paid for it next week or next year in dollar terms.  Nothing backs any hard asset other than the asset itself.

Got it, thank you. 

[rkbabang]

11 hours ago, Buckeye said:

Got it, thank you. 

No problem. I happen to think that Bitcoin will go up in value from here, but I know that there are no guarantees.  The people who bought urban property in Japan in 1995 thought that the value would go up.

 

 

Edited June 14, 2025 by rkbabang

[Libs]

On 6/11/2025 at 9:16 AM, Libs said:

Thoughts on this risk?

 

https://theweek.com/tech/bitcoin-crypto-quantum-computers-dangers?refid=75FFC898AD6883CBB120FC6A86C62323&utm_medium=email&utm_campaign=afternoon_newsletter_20250609&utm_source=afternoon_newsletter

 

Sorry, I should have put more into this post. I believe the biggest risk to BTC is the code getting cracked, but as a layman have no idea how likely that is. Munger thought it was inevitable BTC would be diluted in such a fashion. The article subject is quantam computing and the breaking of current encryption methods.

[jfan]

56 minutes ago, Libs said:

 

Sorry, I should have put more into this post. I believe the biggest risk to BTC is the code getting cracked, but as a layman have no idea how likely that is. Munger thought it was inevitable BTC would be diluted in such a fashion. The article subject is quantam computing and the breaking of current encryption methods.

Here are a couple other articles on the subject:

1) Cracking Bitcoin-Like Encryption Through Quantum Computing Could be 20x Easier Than Thought

- the research paper is attached below

- bottom-line: closer than it seems

 

2) SEALSQ Unveils Quantum-Resistant Cryptography with QS7001 to Secure Bitcoin Wallets Against Quantum Threat — TradingView News

- 

 

- not sure how true all this is

- I would think the challenge to adopting these technologies might be creating consensus in the network

 

 

 

Quantum Computer breaking BTC encryption Google Researcher.pdf

[Seanzy]

There is a pretty high probability that Bitcoin is the new hurdle rate. If you don't expect an investment to beat Bitcoin's future performance, then just buy Bitcoin instead. 

 

Think about it, Bitcoin is a superior technology to digital cash. And its purchasing power has increased because of human psychology. I don't see these factors changing. 

 

This sort of money technology transition has occurred before, when humans had to adopt symbolic money to improve the barter system. Instead of bartering chickens and goats as purchasing power, they bartered everything from precious metals to glass beads to large heavy stones. 

 

Now humans will adopt a borderless, infinitely divisible, immutable, permanent value transfer ledger system out of necessity. In America, we are lucky, because we are not affected by inflation as much as those in other countries. In Turkey for example, I have heard of neighbors splitting watermelons to survive due to their monetary debasement. 

 

These people are going to wake up and start taking their salaries in Bitcoin or investing their salaries in Bitcoin because the currency can't be debased, and they will be willing to take on the price volatility risk out of necessity. Merchants will also be able to potentially improve their bottom lines by reducing credit card merchant processing fees. 

Edited June 16, 2025 by Seanzy

[Fly]

11 hours ago, Libs said:

 

Sorry, I should have put more into this post. I believe the biggest risk to BTC is the code getting cracked, but as a layman have no idea how likely that is. Munger thought it was inevitable BTC would be diluted in such a fashion. The article subject is quantam computing and the breaking of current encryption methods.

 

BTC can't be diluted, even with QCs. There will only be 21mil BTC, currently around 19mil in circulation. If you only use a wallet address once (standard security practice) then QCs don't pose a risk of cracking your private key.

 

https://en.bitcoin.it/wiki/Quantum_computing_and_Bitcoin

 

If the SHA-256 algorithm is broken by a QC then there are going to be enormous global financial/security related concerns, and bitcoin will be a tiny drop in that bucket. There is work being done already to prepare for this future attack against BTC, and we'll likely see a soft/hard fork at some point in the next several years to address the concern. 

Edited June 15, 2025 by Fly

[Metta]

The Bull Case for ETH is $700,000.
280x from current price of $2500.

38 pages report here  https://ethdigitaloil.com/

Edited June 15, 2025 by Metta

[Dave86ch]

19 hours ago, rkbabang said:

No problem. I happen to think that Bitcoin will go up in value from here, but I know that there are no guarantees.  The people who bought urban property in Japan in 1995 thought that the value would go up.

 

 

Bitcoin is like a global land market, there’s always monetary excess somewhere in the world looking for a scarce asset.

 

A global hurdle rate, indeed.

Edited June 15, 2025 by Dave86ch

[TwoCitiesCapital]

13 hours ago, Metta said:

The Bull Case for ETH is $700,000.
280x from current price of $2500.

38 pages report here  https://ethdigitaloil.com/

 

I highly doubt it. 

 

 

16 hours ago, Seanzy said:

There is a pretty high probability that Bitcoin is the new hurdle rate. If you don't expect an investment to beat Bitcoin's future performance, then just buy Bitcoin instead. 

 

Think about it, Bitcoin is a superior technology to digital cash. And its purchasing power has increased because of human psychology. I don't see these factors changing. 

 

+1 

 

BTC has been absorbing most of my incremental taxable savings for the last 2-3 years. Only once it got above $100k did I start slowing that down. 

 

15 hours ago, Fly said:

 

BTC can't be diluted, even with QCs. There will only be 21mil BTC, currently around 19mil in circulation. If you only use a wallet address once (standard security practice) then QCs don't pose a risk of cracking your private key.

 

Would only add that there are credible estimates that 3-6 million are permanently lost. So total eventual supply and current circulating supply are dramatically lower. 

 

15 hours ago, Fly said:

 

https://en.bitcoin.it/wiki/Quantum_computing_and_Bitcoin

 

If the SHA-256 algorithm is broken by a QC then there are going to be enormous global financial/security related concerns, and bitcoin will be a tiny drop in that bucket. There is work being done already to prepare for this future attack against BTC, and we'll likely see a soft/hard fork at some point in the next several years to address the concern. 

+1

Anyone concerned about QC breaking Bitcoin shouldn't own banks, credit card companies, insurance companies that provide cyber security coverage, etc etc etc. 

[TwoCitiesCapital]

I think people, myself included, have underappreciated the extent to which the market is under supplied since the ETFa were launched.

 

Since the 2024 halving, only 450 BTC are produced a day. And not even all of those are are part of the available supply. Miners like MARA and Cleanspark tend to hold every BTC they mine and are responsible for ~10% of the BTC mine in Q1. So less than 400 are available daily in supply. 

 

The Bitcoin ETFs sucked up 2,800 BTC on Friday. 795 BTC on Thursday. 1,500 BTC on Wednesday. 3,900 BTC on Tuesday. 3,600 BTC on Monday. Nearly every day of inflows to the ETFs is sucking up multiples of the daily available supply without including people buying BTC directly. 

 

The ONLY path forward is for the price to rise high enough to where $ inflows buy significantly less BTC or price goes high enough to compel a ton of selling. Either means significantly higher prices. 

[backtothebeach]

2 hours ago, TwoCitiesCapital said:

The Bitcoin ETFs sucked up 2,800 BTC on Friday. 795 BTC on Thursday. 1,500 BTC on Wednesday. 3,900 BTC on Tuesday. 3,600 BTC on Monday. Nearly every day of inflows to the ETFs is sucking up multiples of the daily available supply without including people buying BTC directly. 

 

So who is selling?

[Paarslaars]

Whales. Long term large holders who have been holding their BTC stacks since 2017 or longer. 

[TwoCitiesCapital]

1 hour ago, backtothebeach said:

 

So who is selling?

 

Sure. Everyday there are people selling. But then all that means is were exhausting the supply of people selling @ $105k - 110k to fulfilling that shortfall. 

 

I'm not selling at 105. I won't sell at 105 next week or the week after. Most people who haven't been selling for the last 1-2 months won't be selling at these same prices on the next 1-2 months. So over time, the people willing to sell at 105k -110k are doing so and that population/supply is shrinking.

 

And those coins move to people who think 105k is a good price and plan to hold it beyond that. And then the price moves up to whatever the next wall of supply is and the process repeats. But the price trends up. 

 

Edited June 15, 2025 by TwoCitiesCapital

[Dave86ch]

At some point, people will start collateralizing their Bitcoin to take out loans and live off the proceeds, instead of selling their Bitcoin. Jack Maller of Strike is already working on this, offering products in that direction.

 

As Pompliano points out, Bitcoin is becoming the new bond—a global bond.

[Paarslaars]

https://cointelegraph.com/news/vietnam-legalizes-crypto-sets-digital-tech-ambitions

[TwoCitiesCapital]

6 hours ago, Dave86ch said:

At some point, people will start collateralizing their Bitcoin to take out loans and live off the proceeds, instead of selling their Bitcoin. Jack Maller of Strike is already working on this, offering products in that direction.

 

As Pompliano points out, Bitcoin is becoming the new bond—a global bond.

 

Ledn has been offering Bitcoin backed mortgages for a bit now. 

[Paarslaars]

 

Texas joins the party.

[wachtwoord]

On 6/15/2025 at 4:06 AM, Metta said:

The Bull Case for ETH is $700,000.
280x from current price of $2500.

38 pages report here  https://ethdigitaloil.com/

 

Lol. It's more likely to go down 280x

[Parsad]

https://www.cnn.com/2025/06/25/economy/fannie-and-freddie-crypto-asset-mortgages

 

What causes the next Depression!  Cheers!