Whilst you will probably need to be a financial anorak to have been watching this news unfold, the US SEC finally approved Bitcoin ETFs yesterday, leading to a range of wild claims about where the value of Bitcoin is now going. Some even suggesting that the financial establishment has now legitimised the previously decentralised digital currency after effectively opening the door to the market and letting the blockchain coin walk right on to the trading floor.
Like so many of the issues that we face today in this (deliberately) complex world of ours, the truth, or rather the truths about Bitcoin and what it will now mean for any digital currency to be traded as part of ETF financial packages can be viewed in many different ways. However, the real story is set to be obscured by group think, the narratives that the establishment want us all to believe, and the time that it will take for what will surely be, in the majority, a whole new tranche of lies to fall on their face and for the next new money myth to come unstuck.
Identifying, understanding and yes, accepting the existence of the money myths is very important.
Money myths are at the very core of the problems that the world now faces, and why no matter which way any of us look, everything that we see now appears to be well and truly f***ed up.
Irrespective of whether you are in the ‘digital currency is financial freedom’ or ‘bitcoin was just created as another establishment ruse’ camp, the most compelling benefit of pre-January 10th 2024 Bitcoin was its previously unchecked status of being a ‘finite’ currency or money source. Even though the base of its programming or the blockchain technology that its built upon would already have enabled each coin to have been divided an infinite number of times.
The ’fact’ that Bitcoin (and other cryptocurrencies like it) couldn’t be printed off at will, as has been the case with the US Dollar, the UK Pound, the EU Euro and all other FIAT currencies, has made it a very compelling option for traders of all kinds. Many of whom have bought into the belief that a fixed amount of anything will mean that the value – and therefore the profit to be made, can only ever go up.
Regrettably, the false floor or elephant trap in the pro current digital currency argument is that like the FIAT ‘cash’ that Bitcoin was intended to replace, the true or intrinsic value of the ‘coin’ is zero.
Like any other form of money that is and only ever has genuinely been a medium of exchange, the value of Bitcoin is based purely on belief, and no matter how many people, countries or whether it’s an entire world believe in its value, the reality is that Bitcoin’s value isn’t anything more than zero at any time, and any value held against it in any moment is little more than the equivalent of a bet that can and will be lost, the moment that the secret is either out, or events have enacted their own terminal care.
That the (financial) establishment has taken so long to make any move that can be argued to legitimise the existence and value of Bitcoin should itself be raising many red flags. Rather than leading to any feeling for traders that now is the time to feel overjoyed.
The establishment operates on the basis that nothing is real until it creates or endorses the narrative that says it will be so.
So, the financial marketplace has become very nervous of having so little control over a form of independent currency being seen to be able to offer a financial refuge for traders, when FIAT ‘cash’ is about to collapse and they had no legitimate way to seize the alternative digital form of FIAT that growing numbers have argued is about to take its place.
Regrettably, it takes a very open mind and many hours of viewing or better still, book-based research, to understand the basic principles and yes, the sanitized forms of criminality that underpin the way that the worlds financial and monetary systems currently work.
It is only after challenging and dispelling the many shibboleths that surround the way money works, that a genuine understanding of how ridiculously dishonest the system of money creation and tools such as leverage really are. And that financial products that may be labelled as being one thing such as ETFs cannot be trusted or taken at face value as an indication of what assets, products or the value that genuinely exists within.
The GFC or Great Financial Crisis in 2008 should have proved to be the cautionary tale for everyone about what happens when laws are twisted so that financial traders are legally allowed to play what are potentially world-threatening games. Simply so that they can create and make more and more money – at the expense and to the detriment of everyone else.
Regrettably, our very stupid politicians bought into the idea that it would be in everyone’s interests for the public to bail the crooked bankers out.
After the noise and the dust clouds had at least began to settle down, for the banks and financial sector it was back to business as usual, exploiting everything that they possibly can with money involved and treating everyone – including the glory-seeking political set, as if we and not they are the miscreant clowns.
The lessons haven’t been learned. As FIAT ‘cash’ and its value heads quickly towards the scrap heap, it would appear that the SEC have now provided the opportunity for big money to legally capture and control the digital currency marketplace. Giving them the potential for them to sell – and therefore profit – many times over and exponentially so, from any perceived value that exists from the Bitcoin that any unwitting buyer has been told exists within each and every ETF that they may buy or obtain a part thereof.
Even gold and other precious metals have fallen foul of the dishonesty that exists within financial and market trades. The reality that each and every owner of these – like Bitcoin from now onwards face, is that unless you physically possess the asset or the product that you believe you own, the real value of whatever you think you have bought isn’t worth the paper that its written on, and yes, that will probably mean that it doesn’t even exist.
Adam Tugwell 