On a recent episode of the Galaxy Brains podcast, Michael Saylor made the case that bitcoin isn’t a foreign money and that it’s greatest to consider it as capital and capital solely.
He additionally shared that Tether (USDT) and Circle’s USD Coin (USDC) are the actual digital currencies and unveiled his “evil genius technique” (his personal phrases) to get the world to undertake the U.S. greenback stablecoins versus bitcoin.
On this Take, I’ll cite a few of Saylor’s personal phrases from the podcast earlier than breaking down why most of the factors he made are off base.
Capital, Not Foreign money
“It’s not a foreign money, it’s capital,” mentioned Saylor about midway by means of the episode.
“You simply have to return to grips with it — it’s not digital foreign money. It isn’t cryptocurrency. It’s digital capital. It’s crypto capital,” he added.
I searched the Bitcoin Whitepaper to see what number of occasions the phrase “capital” confirmed up.
It isn’t talked about as soon as.
Nevertheless, in each the title and summary of the textual content, bitcoin is known as “digital money.” Whereas money can in fact even be capital, it’s not solely capital. To consider bitcoin solely as capital is to disclaim sure of its most important properties — like the power to make use of it to transact with anybody wherever on the planet permissionlessly.
To disclaim bitcoin as a foreign money is to disclaim a big a part of its worth proposition. Bitcoin’s roles as a Retailer of Worth (SoV) and a Medium of Change (MoE) are inextricably linked. For extra on this, I’d advise you (and Michael Saylor) to learn Breez CEO Roy Sheinfeld’s piece “Bitcoin’s False Dichotomy between SoV and MoE”.
Because the episode proceeded Saylor continued to (poorly) make the case for why bitcoin is capital and never foreign money.
“There are plenty of maxis who’re like ‘No, we would like it to be a foreign money. We wish to have the ability to pay for espresso with our bitcoin. Pay me in bitcoin,’” he mentioned. “It’s like ‘Pay me in gold. Pay me in a constructing. Pay me with a slice of your skilled sports activities group. Pay me with a Picasso.’”
It’s truly not like that in any respect.
Certain, bitcoin is scarce, considerably like gold, Manhattan actual property, sports activities groups or well-known work, however it has a variety of different properties that make it far completely different from any of those different property.
For example a dimension of that time, I’ll cite my colleague Alex Bergeron:
I invite anybody who thinks Bitcoin is like gold to launch a custodial gold pockets.
I’ll wait.
— Alex B (@bergealex4) December 22, 2024
After which Saylor cited — await it — Fed Chair Jerome Powell’s tackle bitcoin in efforts to drive house his level that bitcoin is capital, not foreign money.
“The explanation bitcoin rallied previous $100,000 is as a result of Jerome Powell on stage mentioned to the world, bitcoin doesn’t compete with the greenback, it competes with gold,” he mentioned.
Oddly sufficient, Saylor mentioned this with out acknowledging that the person who mentioned that is the top of the establishment that Bitcoin ought to theoretically substitute.
USDT, Not BTC
Within the interview, Saylor additionally drove house the purpose that the actual digital currencies are U.S. greenback stablecoins.
“The cryptocurrency, the digital foreign money, is Tether (USDT) and Circle (USDC),” he mentioned. “It’s a stablecoin U.S. greenback — that’s the digital foreign money.”
That is after I began to get nauseous.
For individuals who don’t but know this, Bitcoin got here into the world within the wake of the Nice Monetary Disaster of 2008, when the U.S. authorities together with the U.S. Federal Reserve opted to print U.S. {dollars} en masse (debase the foreign money) to bail out failing banks, the burden of which was laid each on the U.S. taxpayers and U.S. greenback holders worldwide.
Bitcoin is a decentralized cash that was created as an alternative choice to the U.S. greenback and all different fiat currencies. Making an attempt to persuade those who bitcoin just isn’t that is disingenuous at greatest, deeply manipulative at worst.
However this isn’t even the worst of what Saylor needed to say on the episode.
He went on to suggest that the banks that bought bailed out within the 2008 monetary disaster concern their very own stablecoins, which might assist prop up the U.S. debt market.
“They ought to only create a traditional regime to concern digital foreign money backed by U.S. treasuries,” mentioned Saylor.
“The U.S. should have a framework so Tether relocates to New York Metropolis. That’s what you need, proper? And then you definately should principally have a free-for-all the place JP Morgan or Goldman Sachs can concern their very own stablecoin,” he added.
No, Michael Saylor, that’s not what I need. The truth is, it’s very removed from what I need.
I don’t need Tether wherever close to New York Metropolis (my hometown) and I don’t need JP Morgan and Goldman Sachs issuing U.S. greenback stablecoins that they management, primarily the equal of CBDCs.
After I take into consideration Goldman Sachs, the very first thing that involves thoughts is award-winning author Matt Taibbi’s description of the establishment from his New York Occasions bestseller Griftopia.
“The very first thing you have to find out about Goldman Sachs is that it is in all places,” started Taibbi within the e-book. “The world’s strongest funding financial institution is a superb vampire squid wrapped across the face of humanity, relentlessly jamming its blood funnel into something that smells like cash.”
Goldman Sachs, very similar to the U.S. Federal Reserve, is an establishment that sucks the life power from humanity. Bitcoin was designed to take energy away from such establishments, not strengthen them.
Towards the tip of the episode, Saylor laid out his grasp plan for bitcoin and U.S. greenback stablecoins.
Right here it’s:
“All people exterior the U.S. would give their left arm to be capitalized on U.S. bonds. So, my technique can be — and I actually suppose it’s an evil genius technique; it’s so good that our enemies would hate us, however our allies would complain, too. And the U.S. would make $100 trillion in a heartbeat.
Right here’s the technique: You dump gold, demonetize the whole gold community. You purchase bitcoin — 5 million or 6 million bitcoin — and also you monetize the bitcoin community. All of the capital on the planet, sitting in Siberian actual property or Chinese language pure gasoline or each different foreign money by-product that’s held as a long-term retailer of worth — Europeans, Africans, South People, Asians, all of them simply dump their crappy property and their crappy capital property and so they purchase bitcoin. The value of bitcoin goes to the moon.
The U.S. is the massive beneficiary. U.S. corporations are the massive beneficiary. And when you’re doing that, you normalize and help digital foreign money, and also you simply outline digital foreign money because the U.S. greenback backed by U.S. greenback equivalents in a regulated U.S. custodian that’s audited. What occurs subsequent?
$150 billion of stablecoins goes to $1 trillion, $2 trillion, $4 trillion, $8 trillion, in all probability someplace between $8 and $16 trillion, and also you create $10 to $20 trillion of demand for U.S. sovereign debt.
When you’re taking away a bit little bit of the demand as a result of the capital asset of bitcoin grows, you’re including again the demand to again the stablecoin. [The digital U.S. dollar then] replaces the CNY, the Rubble. It replaces each African foreign money. It replaces each South American foreign money. It replaces the euro.
For those who actually imagine in U.S. world reserve foreign money and U.S. values, each single foreign money on the planet will truly simply merge into the U.S. greenback if it was freely accessible.”
At this level, I finished listening to the episode and projectile vomited everywhere in the New York Metropolis subway automobile during which I used to be sitting.
I didn’t come into the Bitcoin house to assist the U.S. run a scheme during which it acquires a big proportion of the bitcoin whereas hooking the world on its trash foreign money, and it deeply saddens me that somebody that many within the Bitcoin house look as much as would give you such a conniving plan.
Bitcoin Is Cash
Bitcoin is cash. It’s a kind of cash that can not be censored or debased that has spectacularly grown in worth over the previous decade, making it certainly one of, if not probably the most, highly effective device ever created for people.
To consider it as something much less, or to attempt to persuade individuals {that a} new iteration of an incumbent model of cash is healthier than it, is to be deeply misinformed.
Whereas bitcoin is capital, that’s not all it’s, and please don’t let Michael Saylor or anybody else persuade you in any other case.
This text is a Take. Opinions expressed are totally the creator’s and don’t essentially replicate these of BTC Inc or Bitcoin Journal.