Cryptocurrencies

[Luke]

2 hours ago, Dave86ch said:

Bitcoin could be a strategic play for the United States. Given the technological advantage it has, with Tether acting as a spearhead, the U.S. is in a strong position. This also gives those who do not want to depend on China as a source of money the opportunity to achieve self-sovereignty by self-custodying Bitcoin.

 

Tether is working on bringing its stablecoin onto the Bitcoin blockchain, both via RGB and through its recent $8 million investment in the Lightning protocol company Speed

Strategic play to do what? The whole reason of bitcoin is to stop states like the US from manipulating the currency. So once the bitcoin is established these exact strategies that serve to give advantages to some nations should not work anymore right? 

 

You are talking like an old school fiat currency strategist and project that onto bitcoin which aspires to be the exact opposite of it? 

 

So what strategic advantages will the "UNITED STATES" to get into a "strong position"? 

[TwoCitiesCapital]

11 hours ago, Luke said:

Strategic play to do what? The whole reason of bitcoin is to stop states like the US from manipulating the currency. So once the bitcoin is established these exact strategies that serve to give advantages to some nations should not work anymore right? 

 

You are talking like an old school fiat currency strategist and project that onto bitcoin which aspires to be the exact opposite of it? 

 

So what strategic advantages will the "UNITED STATES" to get into a "strong position"? 

 

The general argument is that the U.S. is the one who benefits the most from the current fiat regime as the reserve currency; therefore, it would follow the U.S. has the most to lose from the unraveling of that regime.

 

Unless...it is the one who comes out on top of the next one.

 

If globe is destined to move to a neutral reserve asset uncontrolled by any nation - like Gold was - than the U.S. could have a competitive advantage by using worthless printed fiat to buy the new reserve asset before other countries do. Obtaining something of value for nothing. Additionally, by being the first country to be friendly to crypto ventures as well as having a stable rule of law governing them, you do more to attract the talent/businesses/infrastructure development within your borders vs that of your competing nations'. 

 

Does it happen? I dunno. But that is the narrative. 

[Dave86ch]

10 hours ago, TwoCitiesCapital said:

 

The general argument is that the U.S. is the one who benefits the most from the current fiat regime as the reserve currency; therefore, it would follow the U.S. has the most to lose from the unraveling of that regime.

 

Unless...it is the one who comes out on top of the next one.

 

If globe is destined to move to a neutral reserve asset uncontrolled by any nation - like Gold was - than the U.S. could have a competitive advantage by using worthless printed fiat to buy the new reserve asset before other countries do. Obtaining something of value for nothing. Additionally, by being the first country to be friendly to crypto ventures as well as having a stable rule of law governing them, you do more to attract the talent/businesses/infrastructure development within your borders vs that of your competing nations'. 

 

Does it happen? I dunno. But that is the narrative. 

 

The future of the USD is on-chain, and Tether, the most widely capitalized stablecoin issuer, is one of the largest buyers of Bitcoin, both directly and through affiliated investment vehicles such as XXI.

[wachtwoord]

21 hours ago, TwoCitiesCapital said:

 

The general argument is that the U.S. is the one who benefits the most from the current fiat regime as the reserve currency; therefore, it would follow the U.S. has the most to lose from the unraveling of that regime.

 

Unless...it is the one who comes out on top of the next one.

 

If globe is destined to move to a neutral reserve asset uncontrolled by any nation - like Gold was - than the U.S. could have a competitive advantage by using worthless printed fiat to buy the new reserve asset before other countries do. Obtaining something of value for nothing. Additionally, by being the first country to be friendly to crypto ventures as well as having a stable rule of law governing them, you do more to attract the talent/businesses/infrastructure development within your borders vs that of your competing nations'. 

 

Does it happen? I dunno. But that is the narrative. 

 

They can use Bitcoin to extinguish their USD denominated debt. Of course after that they'd have lost all the power they have now with controlling their currency but perhaps they think they can control it and effectively ban Bitcoin if they want control of their currency back after that?

[TwoCitiesCapital]

1 hour ago, wachtwoord said:

 

They can use Bitcoin to extinguish their USD denominated debt. Of course after that they'd have lost all the power they have now with controlling their currency but perhaps they think they can control it and effectively ban Bitcoin if they want control of their currency back after that?

 

 

I don't think you get to default on your debt and then "control your own currency" again after that. 

 

If the US used BTC to default on their debt, then makes BTC illegal tender, and then relaunches fiat? I dont think anyone in the world is going to buy that debt or rely on the USD as a reserve again or accept USD for imports/exports.

 

So the only way the US is "in control" instead of subject to the whims/favors of our neighbors is if we dramatically eliminate federal/corporate/individual spending to dramatically eliminate debt-fueled spending from the system and become self sufficient at production....or pay uncompetitive rates through the nose and subject to the use of others currencies to conduct trade in (i.e. emerging markets).

 

And then you're likely to have riots in the streets if they didn't already happen at the point of default. 

Edited December 18, 2025 by TwoCitiesCapital

[wachtwoord]

16 hours ago, TwoCitiesCapital said:

 

 

I don't think you get to default on your debt and then "control your own currency" again after that. 

 

If the US used BTC to default on their debt, then makes BTC illegal tender, and then relaunches fiat? I dont think anyone in the world is going to buy that debt or rely on the USD as a reserve again or accept USD for imports/exports.

 

So the only way the US is "in control" instead of subject to the whims/favors of our neighbors is if we dramatically eliminate federal/corporate/individual spending to dramatically eliminate debt-fueled spending from the system and become self sufficient at production....or pay uncompetitive rates through the nose and subject to the use of others currencies to conduct trade in (i.e. emerging markets).

 

And then you're likely to have riots in the streets if they didn't already happen at the point of default. 

 

Not a default in nominal terms. They did it post WW2: default by devaluing the debt. Easy peasy if you control the currency.

 

Pushing up Bitcoin enables them to devalue USD faster (and blame external factors). Afterwards effectively banning Bitcoin (the bad guy that caused all that inflation and hardship for the plebs) would allow reintroducing a new currency (New Dollars) resetting debt levels.

 

I don't think they'll be able to effectively ban Bitcoin but they might (believe they can).

 

Governments voluntarily reducing their spending (and by proxy power) is not going to happen. They suck up all resources everything until they implode (revolution, a reset even after a new gov starts the entropy away from individual liberties again).

Edited December 19, 2025 by wachtwoord

[scorpioncapital]

so are we all doomed to a constant hot potato in our financial lives having to move from asset A to B to C before its banned/frozen/capital controlled? It seems a headache. No wonder people like the Swiss like a strong currency at all cost and aim to protect it. I even think the CHF would go up under all of the above scenarios.

 

[UK]

15 hours ago, scorpioncapital said:

so are we all doomed to a constant hot potato in our financial lives having to move from asset A to B to C

 

https://fortune.com/2012/02/09/warren-buffett-why-stocks-beat-gold-and-bonds/

 

Whether the currency a century from now is based on gold, seashells, shark teeth, or a piece of paper (as today), people will be willing to exchange a couple of minutes of their daily labor for a Coca-Cola or some See’s peanut brittle.

 

I like to reread this occasionally:)

[Dave86ch]

18 hours ago, scorpioncapital said:

so are we all doomed to a constant hot potato in our financial lives having to move from asset A to B to C before its banned/frozen/capital controlled? It seems a headache. No wonder people like the Swiss like a strong currency at all cost and aim to protect it. I even think the CHF would go up under all of the above scenarios.

 

I suggest you take a look at Swiss M2.

I am Swiss; I keep stacking sats.

[Dave86ch]

2 hours ago, UK said:

 

https://fortune.com/2012/02/09/warren-buffett-why-stocks-beat-gold-and-bonds/

 

Whether the currency a century from now is based on gold, seashells, shark teeth, or a piece of paper (as today), people will be willing to exchange a couple of minutes of their daily labor for a Coca-Cola or some See’s peanut brittle.

 

I like to reread this occasionally:)

 

History works in cycles. Buffett operated in a period when valuation multiples were healthy because markets weren't flooded with money, within a system where productivity and consumption were still relatively balanced. We are now at a different point on the curve, and pretending we are in the same position as him is dangerous. Many of his teachings remain valid, but Will Durant is more useful for understanding the broader historical context of these cycles.

Edited December 20, 2025 by Dave86ch

[UK]

14 minutes ago, Dave86ch said:

 

History works in cycles. Buffett operated in a period when valuation multiples were healthy because markets weren't flooded with money, within a system where productivity and consumption were still relatively balanced. We are now at a different point on the curve, and pretending we are in the same position as him is dangerous. Many of his teachings remain valid, but Will Durant is more useful for understanding the broader historical context of these cycles.

 

I do not disagree re cycles. Also I think I would easy chose between any fiat currency and gold or bitcoin for the next 10+ years, also perhaps between Bitcoin and gold, for that matter (maybe still a way to go for B to catch up with gold, but there could be other questions). But the problem with these two long term is that by owning them you kind of decline this enormous benefit of productive assets have, be it profit (reinvested or distributed), rent, income from crops or whatever. And taking into account its long term effect I think it really dwarfs this possible headwind because of supposedly high market valuation.

 

[wachtwoord]

2 hours ago, Dave86ch said:

I suggest you take a look at Swiss M2.

I am Swiss; I keep stacking sats.

 

It's relative. CHF is clearly better than all other Fiat currencies (compare loss of purchasing power, eg 22% over the last 30 years with USD losing 111%) but it's still a damn fiat currency.

 

What's a good source for Swiss M2?

[TwoCitiesCapital]

4 hours ago, UK said:

 

I do not disagree re cycles. Also I think I would easy chose between any fiat currency and gold or bitcoin for the next 10+ years, also perhaps between Bitcoin and gold, for that matter (maybe still a way to go for B to catch up with gold, but there could be other questions). But the problem with these two long term is that by owning them you kind of decline this enormous benefit of productive assets have, be it profit (reinvested or distributed), rent, income from crops or whatever. And taking into account its long term effect I think it really dwarfs this possible headwind because of supposedly high market valuation.

 

 

Is going to depend on your starting point, but you haven't really left much on the table by owning gold vs stocks over the last 1, 3, 5, or 10 years. Stocks win out a little (against gold) at 15 because the GFC had just happened and valuations still recovering. 

 

Bitcoin looks even more favorably on 3, 5, and 10-years basis. 

 

Productive/unproductive doesn't matter. Price is what you pay. Value is what you get. And the price/value ratio of gold/Bitcoin has been such that they're just as attractive, if not more attractive, to own. 

Edited December 20, 2025 by TwoCitiesCapital

[Milu]

16 minutes ago, TwoCitiesCapital said:

 

Is going to depend on your starting point, but you haven't really left much on the table by owning gold vs stocks over the last 1, 3, 5, or 10 years. Stocks win out a little (against gold) at 15 because the GFC had just happened and valuations still recovering. 

 

Bitcoin looks even more favorably on 3, 5, and 10-years basis. 

 

Productive/unproductive doesn't matter. Price is what you pay. Value is what you get. And the price/value ratio of gold/Bitcoin has been such that they're just as attractive, if not more attractive, to own. 

I think gold has beaten the S&P 500 over the last 10 years, 20 years, and 25 year period. Goes to show that a lot of the great returns we have seen in assets like stocks and real estate are mostly illusions, just nominal growth in a rapidly devaluing fiat currency. Add in capital gains taxes on any sales and people are possibly even behind in real terms over these timeframes.

[SharperDingaan]

The store of value thing misses a lot ...

 

Fully paid off nice house & furnishings, versus a BTC/Gold holding, which is better? Your spouse will tell you it's the house, 'cause you can enjoy it everyday. Two houses (on different continents), if you are concerned around potential expropriation!  

 

More wealth than you could use in your remaining lifetime; stored as a BTC/Gold holding, which is better? Your spouse will tell you it's not your problem, 'cause you're dead! Give it away, with no strings attached - should the heirs receive anything, they're better off!

 

Need to leave town permanently, and quick; wealth stored as a BTC/Gold holding, which is better? Your spouse will tell you its gold coin, but BTC actually works better. Should there be an unexpected swimming event ... BTC could save your life!

 

.... so how is it, that these very practical considerations, seldom enter the discussion 

 

Live and free, no matter what!

 

SD

 

 

 

 

Edited December 20, 2025 by SharperDingaan

[wachtwoord]

5 hours ago, SharperDingaan said:

The store of value thing misses a lot ...

 

Fully paid off nice house & furnishings, versus a BTC/Gold holding, which is better? Your spouse will tell you it's the house, 'cause you can enjoy it everyday. Two houses (on different continents), if you are concerned around potential expropriation!  

 

More wealth than you could use in your remaining lifetime; stored as a BTC/Gold holding, which is better? Your spouse will tell you it's not your problem, 'cause you're dead! Give it away, with no strings attached - should the heirs receive anything, they're better off!

 

Need to leave town permanently, and quick; wealth stored as a BTC/Gold holding, which is better? Your spouse will tell you its gold coin, but BTC actually works better. Should there be an unexpected swimming event ... BTC could save your life!

 

.... so how is it, that these very practical considerations, seldom enter the discussion 

 

Live and free, no matter what!

 

SD

 

You can just rent a house my friend. Don't mix consumption and investment.

 

You can't own real estate as the state can take it whenever it likes and you can't take it with you to another jurisdiction. Residential RE (non-diversified so holding individual properties) needs to cost 2 orders of magnitude, everything else being equal, for me to even consider owning it the value proposition is so horrendous. 

 

It's very unlikely I'll ever live in a house I own.

[UK]

10 hours ago, wachtwoord said:

It's very unlikely I'll ever live in a house I own.

 

Well this is very personal thing, but as for investment alternative, sure, real estate definitelly has a share of its own problems. Also I am reading that e.g. in EU real estate prices on average in the last 10 years has increased ~80 per cent, while an average rent is up only ~20 per cent. Something to consider if you are not attached to your house too much:)

[UK]

17 hours ago, TwoCitiesCapital said:

Is going to depend on your starting point, but you haven't really left much on the table by owning gold vs stocks over the last 1, 3, 5, or 10 years. Stocks win out a little (against gold) at 15 because the GFC had just happened and valuations still recovering.

 

But the question is would you choose gold over SNP500 for the next 10 years? 

[John Hjorth]

11 hours ago, wachtwoord said:

You can just rent a house my friend. Don't mix consumption and investment.

 

You can't own real estate as the state can take it whenever it likes and you can't take it with you to another jurisdiction. Residential RE (non-diversified so holding individual properties) needs to cost 2 orders of magnitude, everything else being equal, for me to even consider owning it the value proposition is so horrendous. 

 

It's very unlikely I'll ever live in a house I own.

 

Real estate taxes [we have them here in Denmark, too] are indeed a gradually, but total confiscation of the asset over a period of [100 / effective real estate tax rate [in percent]] years.

 

From a strict theoretical perspective [tax on ability to pay taxes] is makes no sense at all, it a conceptual sick bastard, likely in the first place instated somewhere by some deranged political person giving mentally birth to this miscarriage.

 

Pretty incredibible, what the human being is cable of adapting to as an almost natural thingy to live with, actually.

Edited December 21, 2025 by John Hjorth

[wachtwoord]

3 hours ago, UK said:

 

Well this is very personal thing, but as for investment alternative, sure, real estate definitelly has a share of its own problems. Also I am reading that e.g. in EU real estate prices on average in the last 10 years has increased ~80 per cent, while an average rent is up only ~20 per cent. Something to consider if you are not attached to your house too much:)

 

Yup the cost to rent : cost to own ratio certainly affects this decision strongly and I live in a country where this ratio is more extreme to the detriment of owning relative to other places.

 

That's on a relative basis though. However, also on an absolute basis the ratio is, in the western world, stacked to the detriment of owning primarily because (i) people culturally value owning too much for non-financial reasons (eg as a sign of success or a demonstrator of status), (ii) people conflating investment and utility and believing real estate is the primary method to build wealth because of visibility bias (people they know) and conflating nominal and real returns, (iii) governmental policies that peg home prices higher in many jurisdictions (tax bebefits, more beneficially treated loans called mortgages etc) that CAN go away and are already starting to be removed and (iv) historically low interest rates unnaturally set by our central planning overlords (central banks).

 

Yes, to make it more complex, like John says, some jurisdictions on top of the tax systems that have pushed housing prices higher in the past, also tax owning the property more (than other assets) undoing some of that price increase but also moving some of the proceeds of owning the risky assets to the government.

 

Finally the zeitgeist is against residential RE as an investment. Home owners are considered to have unfairly benefited by a LARGE portion of society and are likely scapegoats and victims in the future (govs always take from small unpopular groups). Squatting is getting increasingly common and societally accepted. At the same time population increase (the main push for increasing prices) is leveling off.

[SharperDingaan]

Quite agree! ... but not all the costs/benefits of home ownership are financial, as your significant other will quickly remind you; happy wife, happy life 

 

There's also the reality that if you'd like to start a family ... a modest nest is a lot more attractive that hot wheels; if you have hair growing out your nose ... 

 

SD

[TwoCitiesCapital]

5 hours ago, UK said:

 

But the question is would you choose gold over SNP500 for the next 10 years? 

 

Yes. I made the comment back in ~21 that I thought gold would outperform equities in general for the next decade.

 

I expect the 2020s to be a decade of hard assets where financial assets struggle with regular bouts on inflation and recession. 

 

Only reason I don't own more myself is that I expect Bitcoin to be even more superior, but have plans to roll my BTC into gold, and other assets, at specific price/return points. 

Edited December 21, 2025 by TwoCitiesCapital

[UK]

6 minutes ago, TwoCitiesCapital said:

 

Yes. I made the comment back in ~21 that I thought gold would outperform equities in general for the next decade.

 

I expect the 2020s to be a decade of hard assets where financial assets struggle with regular bouts on inflation and recession. 

 

Only reason I don't own more myself is that I expect Bitcoin to be even more superior, but have plans to roll my BTC into gold, and other assets, at specific price/return points. 

 

Thanks. OK, but what if this AI and automation thing will work out, at least, if not for current darling companies, but in terms of the general economy and productivity, which would led to the higher economy growth for years, which would probably also mean higher interest rates longer term? I have no idea what the probabilities are, but perhaps such scenario is not impossible and it would not be good for gold vs general market?

[wachtwoord]

1 hour ago, SharperDingaan said:

Quite agree! ... but not all the costs/benefits of home ownership are financial, as your significant other will quickly remind you; happy wife, happy life 

 

There's also the reality that if you'd like to start a family ... a modest nest is a lot more attractive that hot wheels; if you have hair growing out your nose ... 

 

SD

 

You mean being allowed to paint the walls?

 

If you mean certainty of living there for the long term you wont have that either when owning as governments can force you to sell to them "for the common good" and frequently do so at least here in Europe. Also homeowners (I hate the English term landlord, prefer the German Vermieter, we know ours personally) cant easily make renters leave in Europe so renters have nearly the same ability to remain living where they live as homeowners.

 

My non-financial reason to prefer renting even more is no maintenance responsibility.

[wachtwoord]

1 hour ago, TwoCitiesCapital said:

 

Yes. I made the comment back in ~21 that I thought gold would outperform equities in general for the next decade.

 

I expect the 2020s to be a decade of hard assets where financial assets struggle with regular bouts on inflation and recession. 

 

Only reason I don't own more myself is that I expect Bitcoin to be even more superior, but have plans to roll my BTC into gold, and other assets, at specific price/return points. 

 

In part or nearly full? What relative valuation are you thinking? Parity?

 

How do you deal with the chance btc displaces gold (purely conceptually it's simply better gold after all. Whether Mr Market will agree remains to be seen of course).