The Old Cabal & New Cabal - Cryptocurrency Adoption and the Future Titans of Industry
Charlie Munger, Vice-Chair of Berkshire Hathaway, recently said that Bitcoin and cryptocurrencies' rise is “disgusting and contrary to [the] interest of civilization.” It is amazing how many of the old guards cannot seem to get engaged with the new paradigms which are coming. The highways are literally being built, and these people are still holding on to the horse and buggy. This brings us to the heart of this article: the old cabal and the new cabal. https://www.msn.com/en-us/money/savingandinvesting/charlie-munger-says-bitcoin-e2-80-99s-rise-e2-80-98disgusting-and-contrary-to-interests-of-civilization-e2-80-99/ar-BB1ghZ52
It should be beyond the criticism of being labeled a *conspiracy* that banks, the elite, and the state have worked into a symbiotic relationship. Murray Rothbard in Anatomy of the State outlines much of the underlying reasons for this. This is perhaps why those like Munger and Warren Buffett, who called Bitcoin “rat poison squared,” still insist on not learning about the technology, the why, and the macro need for digital assets. https://cdn.mises.org/Anatomy%20of%20the%20State_3.pdf https://www.msn.com/en-us/money/markets/warren-buffett-blasted-bitcoin-as-a-worthless-delusion-and-rat-poison-squared-here-are-his-16-best-quotes-about-crypto/ar-BB1cO8au
Michael Saylor’s MicroStrategy, Elon Musk’s Tesla, Square, and a host of other firms have added BTC and crypto to their balance sheets. High-net-worth individuals like Raoul Pal are buying crypto and trying to explain why the larger macro picture is creating a converging environment for the explosion of interest in these markets. But there may also be something larger under the surface going on. https://www.thestreet.com/crypto/bitcoin/microstrategy-wants-to-buy-even-more-bitcoin https://www.cnbc.com/2021/02/08/tesla-buys-1point5-billion-in-bitcoin.html https://finance.yahoo.com/news/square-buys-170-million-more-in-bitcoin-to-boost-crypto-holdings-222926163.html https://www.youtube.com/watch?v=0tJrla31t8I
We can see that many big institutions like JP Morgan went from Jamie Diamond saying he would fire employees for peddling crypto to offering their clients exposure to it. https://www.marketwatch.com/story/jpmorgan-to-offer-wealthy-clients-access-to-bitcoin-fund-report-11619460709
We have also seen big institutions like HSBC banning the involvement of their clients with companies engaged in cryptocurrency ventures. Many firms have figured out the “future is here.” But why the reluctance from the other half? https://finance.yahoo.com/news/hsbc-bans-customers-buying-bitcoin-161140177.html
While it is true that crypto will take many average-income individuals and make them into wealthy ones, this is not the end of the story. This cycle will also make institutions with means become the next banks; the next large financial powerhouses will rise from this cycle to be the names everyone pictures when they hear the words, “titans of industry.” The Winkelvoss Twins and Gemini will be the next Goldman Sachs. MicroStrategy will be the next Blackrock. Coinbase will be the next Chase Manhattan. These images make the old cabal lose their lunch. They have no real power to stop it other than through fear, uncertainty, and doubt (FUD) articles. They cannot stop DeFi, they cannot stop decentralized peer-to-peer money like BTC or BCH, and they cannot stop the future. But they also will not join the rest of the enlightened bunch who have embraced it. https://www.investopedia.com/tech/gemini-winklevoss-bitcoin-exchange/ https://read.cash/@JohnGaltsBrother/blockchain-revolution-more-than-just-crypto-booms-and-busts-023b7124
This leaves an “old cabal” and a “new cabal” situation. The old cabal is more than happy to create an environment where they are part of the systems in place that allows them to maintain their power and place in the world. They do not understand the macroevolutionary convergence, which is taking place with technology in the form of crypto-blockchain, currency/debt crisis, and generational shifts.
Saylor and company are part of the “new cabal.” While it would be nice to believe they will not be corporatists when they take over the old seats vacated by those who refuse to relinquish some of their power, no one can know for sure. However, the underlying tools which would be the backbone of their rise to power do limit just how far they can run as opposed to the old system.
It is in this same sense that while we, “the little guy,” applaud and admire these future gods of the universe, we must also continuously acquire the means of this future and distribute it amongst ourselves. Crypto is like the fire that was stolen from Olympus. The old cabal is upset it got stolen. The new cabal is happy because now they understand it and are going to acquire as much of it as they can. In order to keep it decentralized, we also much acquire and distribute the fire to as many individuals as possible. Or else, the old boss may be the same as the new boss.
Peter Schiff: So Right On Macro, So Wrong On Crypto
Peter Schiff is a great man. He comes from a family of great men. Irwin Schiff is a hero who stood steadfast to his beliefs, and he should always be remembered. This should be acknowledged before going on with an essay that may seem like an attack on Peter Schiff, but this is more of a wake-up call to a man who has been right more than he has been wrong. But he is dead wrong on Bitcoin and crypto.
Back before the Great Recession of 2008, Schiff was on all the major news stations explaining the housing bubble and the risk of a deep recession. Instead of the news heeding his warning, he instead was getting laughed at. Schiff is the head of Euro Pacific Asset Management, has the Peter Schiff Show, a podcast/radio show, and currently lives in Porto Rico due to the favorable tax treatment as opposed to being in the United States proper. A very important thing to note is that Schiff also sells gold and silver. And this may very well be a factor in his dislike of Bitcoin and cryptocurrency, as it goes to prove the old saying, “All Politics Is Local.” https://www.youtube.com/watch?v=sgRGBNekFIw https://europacificfunds.com/ https://www.schiffradio.com/ https://schiffgold.com/
Schiff debated Max Keiser at the Nexus Conference in Aspen, CO, on September 22nd, 2017. Keiser even yelled exuberantly at Schiff about how blockchain cryptocurrency is more important than the printing press. It seems Schiff has not taken the years since this debate to do one shred of an investigation into that insight. https://www.youtube.com/watch?v=fFuT-MEMu94
Schiff recently tweeted (and I could not control myself with a response):
Bitcoin (BTC), Bitcoin Cash (BCH), Litecoin (LTC), Ethereum (ETH), and the list can go on all can be a store of value, a currency, have use cases as commodities, and are investment assets. Specifically, the market driving crypto is BTC, which Schiff seems not to understand anything about. I would encourage Schiff to read Bitcoin.com, Hope.com, and Read.Cash or simply listen to his son Spenser. https://www.bitcoin.com/ https://www.hope.com/ https://read.cash/
I encouraged Spenser to start a podcast if he has not. Just take the things his father talks about that he is correct on, and add his understanding of BTC and crypto, and he would have a winning combination. That way, Peter Schiff’s views which are influenced by his father, Austrian Economics, and other positive sources, and would be updated to the reality of the current times.
Institutionalized Inertia
Schiff suffers from the same problem most people who cannot wrap their heads around crypto have. That is, their frame of reference never changes. Warren Buffet still thinks Bitcoin is “rat poison squared,” with his head stuck in the old days when near-zero interest rates could prop up his (even bad) stock calls over the past thirty years. It seems that most people, like Schiff, cannot go outside of their frame of reference, and the fact he is a seller of gold/silver does not help. Not everyone is as dogmatic as Buffet and Schiff, and it would be unfair to mention all of the institutions which at one time said that crypto is terrible, but now they are buying in. But since this is one of my lesser academic posts, that is precisely what we will do: https://www.msn.com/en-us/money/markets/warren-buffett-blasted-bitcoin-as-a-worthless-delusion-and-rat-poison-squared-here-are-his-16-best-quotes-about-crypto/ar-BB1cO8au
I hope that Spenser gets to Schiff. I would hate to see all of the positive things Schiff has done be overshadowed by his complete ignorance and lack of willingness to understand new technology in this one arena.
Life, Liberty, And Property
Michael Saylor said, “If you believe everyone has a natural right to life, liberty, and property, then it is only a matter of time before you believe in #Bitcoin.” I could not agree more. That is why I still think there is hope for Schiff.
I encourage everyone to jump on Twitter and go after Schiff to learn about BTC, and to encourage Spenser to start his own podcast. Get the Cyber Hornets engaged in spreading the message and winning over someone who should have been on board with the future long ago.
An Open Letter To Gov. Sununu of New Hampshire On Cryptocurrency
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Note: I would like this blog to retain a sense of pseudonymity. While a clever person could probably figure out my identity, believe me: it is not that interesting. I am not Elon Musk. I dislike Dogecoin. I redacted personal information for these reasons .
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To the Honorable Chris Sununu, Governor of the great state of New Hampshire,
My name is [JohnGaltsBrother], and I would first like to belatedly congratulate you on your election victory last year. Residing in [Galt’sGultch], N.H., my wife and I both voted for you and hope to see your elected position continue into the future.
Before jumping into the heart of the matter, I think a short introduction is necessary for context, so you know I am not just presenting an opinion without some background. I am an Emerging Operational Technology Engineer with [a large company]. I am in the middle of my Ph.D. in Business, focusing on Strategic Management. I hold a B.S. from [some university] in Economics & Finance, an MBA, and postgrad diplomas and certificates in different subjects like innovation and blockchain technology. I also teach undergraduate courses at [some university] in Business.
In recent years, New Hampshire has continued to separate itself from the rest of the New England states as being friendlier to individuals and businesses to live and work. What I am proposing here not only will help to bring more opportunities to New Hampshire but will help to separate it from much of the rest of the country as an early adopter of the current trend.
As I am sure you are aware, there are many within the country who are afraid of massive amounts of inflation in prices due to the already inflated monetary supply (measured in M0, M1, and M2 by the Federal Reserve), which increased between 25-32% in the year 2020 alone. Further, continued federal spending is likely to continue, so many people have turned to hedges against this coming tide.
Traditionally, these hedges would include gold and silver. However, due to their relative scarcity within a short time horizon, it is necessary to accumulate more of these resources to maintain the same scarcity ratio as opposed to other finite scarce assets. Recently, blockchain technology has been adapted to include cryptocurrencies, the most famous of which was kicked off in 2009 and is known as Bitcoin.
As you may be aware from the news, Bitcoin is reaching all-time highs and popularity amongst not only individuals but also institutional investors. Notably, Microstrategy, a business intelligence firm, purchased over $2 billion to put in their treasury as a long-term hold. As did Tesla, with a purchase of over $1 billion. Grayscale Investments hold multi-billions of dollars in digital assets and offer clients exposure through trusts sold in shares on the New York Stock Exchange. At the time of this writing, there are eight Bitcoin ETF (exchange-traded fund) which have been applied for, and the new SEC chairmen used to teach blockchain and cryptography at MIT. In addition, Coinbase, one of the leading crypto exchanges, went public last week with a $100 billion evaluation.
In order to be a boon to the great state of New Hampshire, I am proposing a holiday on Business Enterprise Tax and Business Profits Tax for a period of time for businesses and individuals who move to and conduct business out of New Hampshire revolving around digital assets.
Surprisingly, Colorado, Ohio, Texas, Wyoming, and even California are more welcoming with their governmental policies than New Hampshire for blockchain and cryptocurrencies. Wyoming, perhaps more than all of those mentioned, having the most favorable policies created.
By New Hampshire coming forward with pro-digital asset policies for companies and corporations, this can give the state a much-needed boost in high-paying technology and financial jobs. Perhaps one of the few Covid-19 pandemic’s silver linings is it proved that remote workspaces are not necessary for most technological and financial industries. Welcoming financial technology (FinTech) companies into N.H. would not be that much of a stretch, as traditional hubs such as Boston and New York City are not far from our borders. Also, the decreased cost of doing business in New Hampshire is an immediate draw on top of the friendly welcome with some of the incentives mentioned above.
While drawing firms into the state is great, it also highly incentives residents within N.H. to be entrepreneurial within this space. It can create a digital asset safety net that other states would lack if the risk of hyperinflation continues to rise. Right now, transacting in digital assets for a business may have negative tax issues depending on how they are handled. However, there is much more than to this space than just buying and selling crypto assets, including decentralized finance (DeFi) which can be used by residents and businesses already in N.H. to spurn growth and innovation and keep them local as opposed to pushing them out.
While you are the Governor and not a proposer of legislation, I hope that you can work with your team in Concord to think about this high-level proposal mentioned in this letter.
I would be happy to make myself available at your convenience if you or someone on your team would like more detail or information on this idea.
Stay Free,
[JohnGaltsBrother]
On April 16th, 2021, Bitcoin Cash (BCH) reached over 1,000 USD, a recent high for the currency.
So, it is time to push BCH into high gear. While I still push for the crypto-trinity adoption theory and that everyone should incorporate blockchain into their working lives so that they are on the cutting edge of the future, this recent price action is the time to accelerate BCH into greater adoption.
The argument over BCH or BTC being the legit king should be set aside and only argued over a fine whiskey at crypto conventions. BTC is a store of value to be used as an asset to be borrowed against and as a hedge against inflation. If trading and transacting frequently is needed, BCH is perfect. Not that BCH does not store value, just that it can also transact very well.
I was on a call today, helping someone through the crypto-verse and their business. I demonstrated the cost of sending BTC vs. BCH. The amount in transaction fees was enough to convince the person that BTC is not the medium of exchange best suited for them.
Whatever we can do to promote BCH, we should. You were going to give someone a gift card? BCH. Wedding gift? BCH. Does someone owe you for picking up concert tickets? Have them pay you in BCH. Ask restaurants if they accept BCH. Promote read.cash and tell people to write articles here and link them to their external site. BCH should be the first thought when wanting to transact in crypto. But it cannot happen if the core community doesn’t start pushing the circle of adoption even greater than it currently is.
@JohnGaltsBrother
