Chris Hayes broke down a plan by Republican legislators to transfer billions of dollars of taxpayer money to owners of Bitcoin in exchange for their holdings.
Someone is sitting on billions of dollars, but can’t sell, because that valuation is based, in part, on those particular assets being lost.
Ok if someone tried to sell hundreds of billions at once. But somebody could sell maybe a million here and there over a long period of time. That hasn’t happened in the case of these “Satoshi” bitcoins.
The Satoshi coins are special, because even though they exist and are part of the calculated BTC “market cap”, everyone assumes the keys are lost and factors that into the scarcity price. So if those coins move for any reason it proves that someone still has the keys, then at best the market takes an immediate 5% haircut to account for the increased supply. But since so much of the story around Bitcoin is about it’s mysterious anonymous creator, it could cause more of a dump as people think that if Satoshi is bailing on the project, it is probably over for good.
But if those coins go to a wallet publically associated with the US Government, with a pledge to hold on to them as a reserve, that sends a different statement, that those coins are controlled but can still be counted on not to move…
… as long as Government policy doesn’t change. So now Democrats come to a reckoning on crypto. Because if Bitcoin becomes Officially Endorsed by the US Government, all the Crypto Bros now have even more reason to sell 100 of their BTC every four years to put their thumb on the election. And if Democrats take over and put the screws to Crypto causing a meltdown, it now puts a big hole in the US balance sheet.
Ok if someone tried to sell hundreds of billions at once. But somebody could sell maybe a million here and there over a long period of time. That hasn’t happened in the case of these “Satoshi” bitcoins.
The Satoshi coins are special, because even though they exist and are part of the calculated BTC “market cap”, everyone assumes the keys are lost and factors that into the scarcity price. So if those coins move for any reason it proves that someone still has the keys, then at best the market takes an immediate 5% haircut to account for the increased supply. But since so much of the story around Bitcoin is about it’s mysterious anonymous creator, it could cause more of a dump as people think that if Satoshi is bailing on the project, it is probably over for good.
But if those coins go to a wallet publically associated with the US Government, with a pledge to hold on to them as a reserve, that sends a different statement, that those coins are controlled but can still be counted on not to move…
… as long as Government policy doesn’t change. So now Democrats come to a reckoning on crypto. Because if Bitcoin becomes Officially Endorsed by the US Government, all the Crypto Bros now have even more reason to sell 100 of their BTC every four years to put their thumb on the election. And if Democrats take over and put the screws to Crypto causing a meltdown, it now puts a big hole in the US balance sheet.