Bitcoin (BTC) and the $ 20,000 look at each other. The well-timed rumors of wallet regulation… are offset by the fall in the dollar.
The downward trend that started in March continues. The 6 trillion dollars printed by the FED weigh heavily on the Dollar Index (DXY) which lost 10% compared to the high of March:
Starting from a base 100 dating back to 1973, the DXY Index reached an all-time high of 151 in 1984 and an all-time low of 72 in 2008. It currently sits at 90, the lowest in more than two and a half years. The yuan is absent from the DXY basket of currencies, but note that the dollar has also depreciated by about 10% against the red note.
Those trillions (6,000) are all money to water the debt ponzi scheme, dilute the value of every dollar already in circulation, and keep interest rates low. The goal, of course, is to prevent the bursting of the debt bubble.
Consequence: the real rate on the US 10-year debt fell below 0%. The real rate is the US 10-year loan rate minus the inflation rate. In other words, the simple fact of saving in dollars wastes money because current savings products are invested in US debt.
And it’s even worse in Germany or France. There is currently the equivalent of $ 17 trillion in negative yielding debt in the world!
The reality is even worse than what this chart suggests because inflation is way above the masquerade of the official figures. It is more between 5% and 10% per year.
The collapse in the purchasing power of the fiat currency will soon worsen if we believe the rise in the prices of the raw materials most used in industry (iron, copper, aluminum, zinc). This increase confirms whether the dollar had to enter a long-term downtrend. In fact, as commodities are largely denominated in dollars, their price rises when the dollar falls, and vice versa.
Even the rise of the Wall Street ponzi no longer helps stop the dollar’s crumbling. And by the way, don’t think that owning stocks will cover you against inflation. To be sure, the global market capitalization may have just passed $ 100,000 billion. But beware of the casino backlash. The completely delusional “price / earning ratios” of multinationals such as Amazon or Tesla are very worrying.
In short, an oil shock will suffice and inflation will be out of control … Bodes well for Bitcoin which will inflate as the bubble deflates …
Yes, Bitcoin is a protection against the bursting of these bubbles and, ultimately, the theft of your savings. A robbery in broad daylight via inflation; negative interest rates; or bankruptcy.
It is only in order to deprive you of a loophole that the powerful want to pass laws to regulate it. The founder of Coinbase recently expressed his concerns about regulatory rumors. This has clearly cast a chill at the root of the BTC / USD pair’s hesitation over the past few days.
Bryan Armstrong said the Trump administration will introduce new personal wallet laws. This rumor of banning anonymous private wallets is acting like a leaden on Bitcoin.
Asked about the question, the US “controller of the currency” kicked in, assuring however that Bitcoin will not be banned. As if we could ban Bitcoin … The only way to do that would be to shut down the internet …
“We have come to a point where the adoption of Bitcoin is too great, the technology is too important, the need for this safe haven currency is too great to disappear. “
However, it is hard to imagine how regulation can serve Bitcoin, especially when we know Donald Trump’s opinion on the subject:
We will likely be in the same boat if Joe Biden ever moves into the Oval Office on January 20 as he appoints Janet Yellen Secretary of the Treasury. The former president of the Fed has already argued that she is not a fan of cryptocurrencies. And how could it be otherwise with a central banker whose job is to perpetuate an inflationary ponzi? ..
- Let’s finish by recalling what should be the real regulations in favor of Bitcoin:
- Consider Bitcoin as a currency in its own right and abolish this Kafkaesque tax on capital gains.
- Accept Bitcoin for tax payment.
- Make it a legitimate international reserve currency along with the dollar, euro or pound sterling (which seems to be on the right track in Iran as well as in Venezuela).
It is apparently not easy to cross the $ 20,000. But, whatever happens, dips will always be buying opportunities. That goes without saying..
- BTC / USD weekly chart (one candle = one week)