Knut Svanholm, the Swedish author, Bitcoiner, podcaster and educator, is a prolific writer and eccentric, charismatic persona in Bitcoinland. We don’t have royals in Bitcoin and we routinely slay our heroes, which means that anybody who sticks around for a long time has Lindy-proven integrity. Svanholm is one such character: If you’ve attended the conference circuit in recent years, you’re likely to have encountered Svanholm’s enchanting voice and scruffy beard — cowboy hat included for fashion and good measure. 

I’ve always had a weak spot for this fellow Scandinavian, whether it be his uncompromising words or impressive output, his funky demeanor or funny personality. In a recent interview with Bitcoin Magazine, we chatted about publishing books in the modern age, writing, praxeology — the arcane science underpinning Austrian economics — spirituality, nation-states, the cooperative nature of Bitcoin, how Bitcoin wins and why leaning into “the fun” makes for a better path to the brilliant, bright, orange future we both see. 

Together with his sidekick and co-author Luke de Wolf, Svanholm has incorporated the publishing house Lemiscate Media in Estonia, which allowed them to accept sats and keep bitcoin on the balance sheet — a bitcoin treasury company, the old-fashioned way. It also offered a convenient way around Amazon’s book publishing gatekeeping and meant that all books became print-on-demand. (All of Knut Svanholm’s previous book — including “Everything Divided by 21 Million” and “The Inverse of Clown World” — are available via Lemiscate.)

JB: Knut, tell me about your publishing company. Are you trying to copy Saifedean Ammous and make Lemiscate Media be like his The Saif House?

Knut: Yeah, I’ve always been a little bit Saifedean-like, or rather: Saif with a pirate hat. But it’s not because I’m copying Saif on purpose, but rather that things have just played out this way… There’s a reason why that happens. The same thing happened with my book “Praxeology: The Invisible Hand That Feeds You” — I re-wrote it this year and turned it into a full course for Plan ₿ that’ll be released this winter. It was all a very Saifedean-like approach, echoing what he did with his “Principles of Economics” textbook. Mine is much less dense: The chapters are shorter and a bit more accessible than in Saif’s book. 

JB: One question I had for us sitting down was about your book “Praxeology,” your attempt to connect Bitcoiners with Austrian economists. When it came out, I saw almost nobody writing about it (I did!) — what happened? “Everything Divided by 21 Million,” massive success; “Praxeology,” almost nothing. What gives?

Knut: Generally speaking, I think people read less and it’s hard to follow up on a hit. Plus, there are a little too many Bitcoin books right now as well; people don’t know what to choose. The more long-term goal here is to assemble all of the books into one, a “collected volumes” type of thing, leatherbound etc. The podcast I run with Luke de Wolf, Bitcoin Infinity Show, is more for hardened Bitcoiners — conviction-deepening rather than orange-pilling… 

JB: …then why are you clowning about so much on the show?

Knut: Haha… it doesn’t matter what you do, the absolute most important thing is that what you deliver is entertaining in some way. That can be because it’s interesting or because it’s passionate — or because it’s fun! And fun can be a shortcut to entertaining: If it’s fun, people stick around. If you keep your humor about, that becomes a tool for making people listen. We think about this when it comes to Satoshi Rockamoto [the pop-up concert events that Svanholm runs together with Mike Jarmuz, Samson Mow, Martti Malmi etc., eds. remark]. It started way back, at an event in Mexico and we all just borrowed some instruments and were all surprised at how good it sounded… Wouldn’t it be a good idea to do this at different conferences?!

JB: Yeah, those shows are amazing, and you can really tell that you guys are having fun. Is it all planned and rehearsed, or do you guys just wing it?

Knut: No, it’s completely improvised. This time in Helsinki at BTCHel was the first time we rehearsed together — once. I often gotta pinch myself… Am I really in a band with Martii Malmi and Samson Mow?! What everyone who is anyone in Bitcoin have in common is that they’re just themselves, and that just works. 

Knut: I’m trying to live by my words, practice what I preach… and I’ve long had this idea that we are our satoshis. 

JB: I remember the first time I heard you say that, on stage in Prague 2023 — and you just looked completely out of your mind!

Knut: The entire distinction between satoshis and personhood is pretty blurry: All there is to Bitcoin is keeping a secret from someone else… All nodes, all miners, etc., have a person behind them. They’re not “backed by energy,” but by human action (…which, technically, is also backed by energy). At the end of the day, I always say that Bitcoin is an agreement on a fixed set of rules, and the reason we agree on this specific set of rules is that they are costlier to try to break than to just follow. And that’s what allows for resistance, irreplicability and finiteness. 

JB: There’s a quote in economics and game theory to the effect of “trading is cheaper than raiding,” but still world history is littered with wars. What do you make of that?

Knut: Yes, but if the aggressor thinks that he has enough to profit from violence, there’s a risk he will. Where Bitcoin is different is that I can threaten you with a gun — Joakim, give me all of your sats! — but there is no way for me to know how many sats you have. So game-theoretically, it’s better for me to offer you something of value and trade with you… Bitcoin has moved the point at which aggression pays further out, and this aspect of Bitcoin is so underappreciated.

But let’s return to this idea that we are all our satoshis. Everybody wants to pump their bags, and we all benefit from number-go-up, which means all companies and everybody in Bitcoin have an incentive to help each other. 

With Lemiscate and Bitcoin Infinity Show we’re really trying to put that in practice right now, by giving as much as we can because, in the end, it all comes back to us! Why not cooperate? Take Vexl, the peer-to-peer trading platform out of Prague; they’re not paying us a dime to say this, but I still want everyone to be on Vexl — it’s an excellent service. 

Bitcoin jobs in general is so completely different than fiat jobs; you don’t even need to, or can expect, to be paid anything to begin with. Rather, you must provide value first and then reap rewards later. That’s so powerful, and most people don’t get that: All I want is for you to flourish. 

JB: The connection to Praxeology is so obvious: We’ve sort of fiat-ized what “work” is. A job is: you’re employed by someone, you do something and you’re paid by the hour… And there are laws around this, it’s your right as a laborer to receive this money. And nobody thinks about how working is about creating value for someone else.

Knut: And that doesn’t stop being true just because someone — the state, labor unions — is trying hard to make that not true. Still, an employer won’t hire anybody if it’s too costly. Say you want to hire somebody in Sweden. Then you have to consider that you can’t fire them very easily, you gotta pay payroll taxes, and income taxes etc., if they’re ill, you have to pay for their recovery, and blah-blah-blah. 

It leads to this entitlement idea, a culture or I deserve all this. Most people don’t understand how Bitcoin is different here: What happens when there is a way to signal value that’s deflationary, absolutely finite, such that all prices — including salaries — fall over time, while purchasing power rises. 

If you hire someone, and that someone gets the same amount of satoshis every month, their real salary is effectively increasing… You never need to readjust salaries. Micropayments is such a fiat idea… The entire model of velocity of money is a Keynesian idea.. I think subscription models will increase in popularity. On a deflationary standard, a company has every incentive to receive one larger payment early over many smaller payments later, because it will receive fewer and fewer satoshis every time. 

JB: Uh, ok…

Knut: I think people just underestimate what deflation is. That’s the main thesis in “The Inverse of Clown World”: Everything that’s true in fiat, the inverse of that is true in Bitcoin. 

On a bitcoin standard, we’ll have fewer transactions — not more. It’s a pet theory I have, and it was in a Bitcoin Magazine article (“The Real Scaling Solution for Bitcoin”) a few years ago: With a richer society, you’ll have fewer transactions. Say ten rich people and ten poor people are having dinner. Among the rich people, at the end of the night, someone picks up the tab, so over time there’ll be ten transactions — one per dinner. But for the poor people, who don’t have enough wealth, everyone has to pay for their own meal on every occasion, meaning a hundred transactions. 

If we focus on quality instead of quantity, which is what happens in a deflationary economy, what happens is fewer transactions but more significant, valuable transactions. 

“Will give everyone a reason to save rather than overconsume, giving more people access to whatever they want over time because of the falling prices. If you postpone your spending, your bitcoin will buy you more in the future. In other words, fewer transactions. Quality before quantity. The necessity for transactions per second will diminish.”

This article really didn’t pull any punches. In a hundred years, you won’t pay for coffee anymore; the barista will give it to you for free, since he has built up this entire chain of trust over generations, which will ensure that you want to give him something of value. 

JB: Like that quote you referred to on stage here at BTCHel, know-your-customer laws are economically illiterate; trust is the opposite of money. Trading partners only need to use money when they don’t trust someone. The difference is, you use credit money with those you trust, and commodity money with strangers. 

Knut: Precisely! You only need money in trade when you don’t trust the people you’re trading with. That’s the problem with credit money altogether: It isn’t money. Even if you have debt notes or credit money, it has to be denominated in something — and that something is what constitutes money. 

I learned this in Murray Rothbard’s excellent book “What Has Government Done to Our Money?” There’s no doubt about it: Credit money is not money. Money represents something valuable; even if that’s a debt, it has to be denominated in something — and it’s that thing that is money. When you accept a receipt for something and you don’t receive the thing back, that’s theft. 

And that’s what banknotes are.

JB: You write something to that effect in the beginning of your 2020 book “Independence Reimagined”, about how collective imagination is one of our greatest strengths as humans — but also our worst weakness. Natural law, property rights, money etc, aren’t out there, in nature, right; we don’t discover them, but invent them, no…?

Knut: No, all the way down to molecular biology or complex societies like ant hills, I think, where we find examples of what looks like cooperation and herd behavior, but in reality, you’re backstabbing them — the black sheep of the herd, etc. What’s evolutionarily good for the herd isn’t always the same as what’s good for the herd. 

JB: This is something monetary scholars often talk about, what is it that money does in a society? Large-scale cooperation, overcoming Dunbar’s number etc. It’s these collective delusions that let a billion Catholics cooperate, or 330 million Americans to all believe in their shared stories — not that America is doing extraordinarily well, but that’s beside the point — the belief that we are one unit is what lets us cooperate so we’ll create bigger things.

Knut: Organized religion and, after that, nation-states, might be good for your tribe, for convincing people that they go to heaven if you murder members of this other tribe. And to do that, we have to cooperate, so we need to tax citizens this or that much and then demand that you give your life for the herd. That’s rarely good for the individual soldier. And some of these units have created pretty destructive things, too. 

For some of these topics — like the question of God — I’m perfectly comfortable not knowing certain things, if I know these are questions we can’t answer. If you were to order the great Austrians in order of religiosity, I think we’d get Mises -> Rothbard -> Hoppe. 

What I’ve changed my mind about is that I nowadays believe democracy to be the most dangerous religion. It’s better that people believe in a fake friend in the sky than an earthly friend who swindles them. Religion is a tool for managed control, the best way to fool 18-year-olds into war — and psychopaths will use it!

JB: What’s the connection to economics or praxeology?

Knut: Well, economic thought was actually better before the Enlightenment than after. At that time, all economists were also theologians grappling with the basic question, What does God want? Many of them are opposed to the phenomenon of interest, unethical practices and turning people into debt slaves

JB: … like Jeff Booth said in his lecture at BTCHel “No They. Only We”…

Knut: Precisely, and it’s not until we get Austrian economics that we actually can explain how interest is ethical —  That it’s just the price of tomorrow, to quote Booth. 

And prices and interest rates fall in a free market. 

JB: Everything we talk about here is so in the weeds, so deep, so spiritual. Praxeology itself is a bit like that, making us wonder what in the world is this thing we call consciousness, choice, economics?

Knut: The basic tenet is that science cannot derive an ought from an is — but with praxeology, we can get pretty darn close! Hans-Hermann Hoppe explains it best, but if I were to try, I’d say, “All communications and interaction between humans are the result of some sort of conflict.” We perceive value in communicating rather than attacking, which means all language is for resolving conflict; we have human language so that we can comprehend one another. 

From there, you’re very close to absolute property rights. And here’s argumentation ethics: 

If I say every human owns their own bodies, you cannot rebuke that without proving my point.

And from there, we can derive so much knowledge from that, if you only accept those axioms. But they are still pretty darn sound axioms. 

JB: So why isn’t this sexy? Why doesn’t it sell? I think this is, big-brain gigachad boom stuff… but nobody cares. 

Knut: …and it’s so goddamn simple that it’s better to cooperate than to use violence. People don’t understand how much they’re being robbed today; everybody underestimates their own value. It’s tragic, but not that hard to explain: You have an institution — public school — entirely funded by theft. You learn math and English and whatever, but you also learn social science, which is nothing but opinions and bullshit. We’re taught obedience rather than providing value. 

Everything that at some level is supported by government money is corrupt and unethical. These ideas have existed for centuries, but it’s so hard for normies to get past this: 

If there’s one thing public education shoves down our throats more than anything else, it’s that democracy is the most important and most beautiful thing we have. It’s not. It’s a system that says, because of a popularity contest, you have the right to take others’ stuff; it’s completely wrong, beginning to end.  

JB: How do you see this fixed? How do we win?

Knut: The more we use bitcoin, KYC-free, between each other without paying taxes, and without inflation, the more we disarm the psychopaths. 

JB: Very, very slowly, one person at a time?  

Knut: Yes: Sooner or later, everyone wakes up to this. Anyone who attends these Bitcoin conferences can see for themselves how freakin’ superior bitcoin is to fiat money. 

JB: We went on a Bitcoin Walk in Helsinki yesterday. We stopped at a café — cute, small, two people working there, and 50 Bitcoiners show up. Obviously, everyone was gonna try to orange-pill this poor barista: wallets, zapping, the whole ordeal. Just think about it for a minute, 50 people, 5,000-10,000 sats zapped each, that’s a good couple of hundred bucks. Easy money, right? No, the dude had zero interest; he just wanted to serve coffee and get on with his day. 

Knut: Well, at dinner last night, we met a server who was exactly the other way around. She was super interested, “Oh yes, I’ve heard about bitcoin but I’ve never tried it, don’t know how it works.” From just a handful of us, she got some $50 — super happy about it!

JB: So the guy we met yesterday just didn’t have curiosity awakened yet, whereas your server from last night did…? You think that’s the difference? 

Knut: Yes! The biggest reason for this is that to even grasp what Bitcoin is or what it does, you need to spend 100 hours on self-education… and most people aren’t willing to do that! The biggest hurdle to adoption is that people don’t have time; they don’t have 10,000 hours or whatever to invest into Bitcoin in order to fully understand it. 

JB: But we do have that time — certainly in a country like Finland. At least in the West, we work fewer hours, we have higher real wages, more leisure time. You can devote your time to whatever.

Knut: Sure, but most people want to go to work, then go home and feel like they made a living for themselves when actually they worked three out of five days for the government, and another for the banks.

That we still have money and time left is a testament to how strong the free market is: Everything good in the world comes from the free market. It’s a more powerful force than any totalitarian, self-pompos leader ever could be. 

Despite democracy, taxes and inflation, things move forward. We have progress. 

JB: Alright, wrapping up. What gives you hope? Where do you see the light? I don’t think the future is dark — it’s bright af — but the more you look out into fiatland, the worse things look.

Knut: That’s because the future isn’t in fiat — it’s in Bitcoin. The future is bitcoin. It’s definitely this “Which Way, Western Man” meme. Either we’re in a world where everyone cooperates — like Booth says, eight billion people in service of eight billion people — or we’re going further down totalitarian oppression, darker and darker. 

If we didn’t have Bitcoin, I’d be much less hopeful for the future. 

Bitcoin exists, it’s easy to learn, and when a system is better, people make the change — put like that, why wouldn’t Bitcoin win? 

The world with Bitcoin is beautiful. 

This post Bitcoin Gives Me Hope, Says Knut Svanholm in Bitcoin Magazine Exclusive Interview first appeared on Bitcoin Magazine and is written by Joakim Book.

Warren Buffett, America’s most beloved investor and part-time Bitcoin hater, sometimes talks about Berkshire Hathaway’s massive cash pile as an “elephant gun.” The company’s assets are huge and it sits on hundreds of billions in cash, which means that for Buffett to meaningfully move the needle for his company’s investments, acquisitions have to be supersized.

The bitcoin treasury company sphere is coming around to a similar observation: Go big or go home, even when the bitcoin price falls and makes life difficult for the BTCTCs. To make a meaningful dent in the race to most corporate bitcoin -slash- carve out a nice chunk of this future financial world we think Bitcoinizing finance will produce, you need a lot of bitcoin: Even Nakamoto’s $679-million purchase only got them some 5,000 BTC.

Buffett’s problem is that in the supersized class, most things are efficiently priced and so you can’t readily outperform by acquiring businesses there. The bitcoin treasury scene isn’t very efficient (yet?). Why a pot of bitcoin listed on a stock exchange trades at anything other than its bitcoin market value makes little sense to me (yes, yes, I get it: discounted future banking opportunities, and ability to keep financially engineer yourself into a larger pile). Thus, our beloved BTCTCs have the same problem Buffett has.

“Every day I wake up thinking, ‘crap, I gotta get to work because the Metaplanet people will outpace me'” – Michael Saylor, Sept 17, New York City

In Bitcoinland, we like to keep things interesting. From macro news this morning, we saw gold reach all-time highs, while Metaplanet, Strategy and Capital ₿ announced poorly timed massive gobblings of coins as the bitcoin price abruptly fell some 5% amid the largest liquidation event for crypto this year.

And we saw the first of many predictable acquisitions of bitcoin treasury companies taking place.

Semler Scientific (NASDAQ: $SMLR), a health care company turned bitcoin treasury company with 5,021 BTC on its balance sheet, has for weeks traded below the market price of its bitcoin, making it a prime acquisition target, as it would allow any sufficiently large player to buy 5,021 BTC at roughly the cost of 4,400 BTC). Thus, the financial-engineering flywheel ability for Semler was over and its Bitcoin management would have had to rely on actual, old-school cash flows to stack more sats. (Some one-quarter of bitcoin treasury companies are in that situation now.)

In came Strive (NASDAQ: $ASST), with an all-share acquisition deal to take over the company, while also acquiring 5,886 bitcoin for itself (instantly underwater by 3%, having burned some $20 million on bad timing). The press release for the deal cites this hypothetical, kind of misleading “210% premium” figure (that’s also all over Twitter):

“Semler shareholders will receive 21.04 Class A common shares of Strive for each Semler share, valuing Semler at $90.52 per share, a premium of more than 210% to its Friday close.”

Semler Scientific’s stock (NASDAQ: $SMLR) shot up almost 30% in early morning trade, to quickly give back most of that gain, at press time sitting on +11%. In typical financial market fashion where the acquirer in hubris might have overpaid for a target, Strive (NASDAQ: $ASST) saw its shares fall upward of 11% in today’s trading.

And there’s clearly more to the story, with Strive itself forking over overvalued shares (its mNAV is in the 3-8 range, depending on dilution), so the real bitcoin-value that SMLR shareholders receive is roughly aligned with where Wall Street is trading that stock this morning. There’s no arbitraged premium when you’re paying with air! The price of Strive shares when they unlock later this year, is unknowable. Plus, our beloved Matt Levine at Bloomberg called the trade in July: 

“eventually there will be stock-for-stock mergers of Bitcoin treasury companies. The ones that trade at lower premiums will sell to the ones that trade at higher premiums.”

…which he reminded everyone about in his newsletter today.

At the NYC Unconference treasury event last week, I spoke to someone who definitely had knowledge of this deal — they shared nothing; I received no MNPI — but they seemed oddly unfazed by the fact that many treasury companies trade below the value of their bitcoin holdings. Of course, if I was aware of an elephant hunter already closing a premium deal on my undervalued company, then I’d feel pretty calm as well.

Doing some back-of-the-envelope calculations here, Semler’s 17,051,000 fully diluted shares gave it a market capitalization of just below $500 million per Friday’s close… but its bitcoin holdings on Friday were worth $580 million (about $564 million at press time, bitcoin price crumbling today). With each common share of SMLR turning into 21.05 ASST shares, Strive is forking over some $1.4 billion of paper for the privilege of owning Semler — with $564 million being pure, market-value bitcoin and the remainder for the cash-flow positive business that is Semler Scientific. At free cash flow of about $49 million last year, that spits out a price-to-free-cash-flow of about 17 for Semler’s operating business. Looking up valuations of other health care companies, that seems pretty reasonable. 

Of course, it raises the question as to why SMLR shares were changing hands at $29 on Friday if $90 would have been a reasonable value… and Mr. Levine has the snarky answer for us: 

“Wouldn’t it be more efficient for Strive to sell that $1.3 billion worth of stock for cash and use the cash to buy $1.3 billion worth of Bitcoin, roughly twice as much as it’s getting in this merger? Why wouldn’t it just do that? Ahahaha no I’m kidding I know why. These days it is harder than it used to be to sell $1 worth of Bitcoin for $2 on the stock market, but it’s easier if the buyer is also a crypto treasury company.”

We’ll see how the exact details flush out, but the world of bitcoin treasury companies defying financial gravity sure keeps our days interesting. 

BTC Inc, Bitcoin Magazine’s parent company, is affiliated with Nakamoto ($NAKA) through common ownership. BTC Inc also has a contractual relationship with Nakamoto to provide marketing services.

Semler Scientific ($SMLR) and Strive ($ASST) are both members of Bitcoin for Corporations connected to Bitcoin Magazine via shared ownership, as BTC Inc operates Bitcoin For Corporations, a platform focused on corporate adoption of Bitcoin.

This post Bitcoin Price Falls Abruptly. Did Strive ($ASST) Just Deploy Warren Buffett’s Elephant Gun? first appeared on Bitcoin Magazine and is written by Joakim Book.

The suitcoiners are in town. 

From a low-key, circular podium in the middle of a lavish New York City event hall, Strategy executive chairman Michael Saylor took the mic and opened the Bitcoin Treasuries Unconference event. He joked awkwardly about the orange ties, dresses, caps and other merch to the (mostly male) audience of who’s-who in the bitcoin treasury company world. 

Once he got onto the regular beat, it was much of the same: calm and relaxed, speaking freely and with confidence, his keynote was heavy on the metaphors and larger historical stories. Treasury companies are like Rockefeller’s Standard Oil in its early years, Michael Saylor said: We’ve just discovered crude oil and now we’re making sense of the myriad ways in which we can use it — the automobile revolution and jet fuel is still well ahead of us. 

Established, trillion-dollar companies not using AI because of “security concerns” make them slow and stupid — just like companies and individuals rejecting digital assets now make them poor and weak. 

“I’d like to think that we understood our business five years ago; we didn’t.” 

We went from a defensive investment into bitcoin, Saylor said, to opportunistic, to strategic, and finally transformational; “only then did we realize that we were different.”

Michael Saylor: You Come Into My Financial History House?!

Jokes aside, Michael Saylor is very welcome to the warm waters of our financial past. He acquitted himself honorably by invoking the British Consol — though mispronouncing it, and misdating it to the 1780s; Pelham’s consolidation of debts happened in the 1750s and perpetual government debt existed well before then — and comparing it to the gold standard and the future of bitcoin. He’s right that Strategy’s STRC product in many ways imitates the consols; irredeemable, perpetual debt, issued at par, with the yield fluctuating around the fixed income. The difference is that instead of being backed and issued by the British government and managed by the Bank of England, STRC is issued and managed by Strategy, a private business intelligence company turned proto-bitcoin bank. (And the Bank didn’t micromanage the interest rate to target a specific yield.)

We’re in the first year of reinventing the financial system, Saylor concluded. 

“We say that Bitcoin miners recycle stranded energy; well, bitcoin treasury companies recycle stranded capital.”

Michael Saylor pointed to pension funds and money market mutual funds and said, “more than two-thirds of the capital is locked up in structured institutions right now — it’s capital sitting in a bank, a pension fund, an insurance fund, a retirement fund, an institutional investment fund.”

All that could be freed, the bitcoin treasury company story goes, to be intermediated between the old world’s incessant desire for “yield” and the new bitcoin world that Michael Saylor and Strategy is busy building. 

Michael Saylor thinks that fixing the money happens by fixing all the other money-adjecent industries: finance, regulation, corporate governance, security markets. He remarked, unironically, that during the various gold standards, credit on gold got bigger than the gold market itself. Implication: there’s plenty more paper bitcoin to come. 

It’s a terrible role model, given that self custody, seizure resistance and unstoppable transfers are what bitcoin does so well over gold. Centralized markets and paperized gold is what broke the old world’s “perfect money.”

Bitcoin Treasuries: Walking A Tightrope

Toward the end, we got a nice, little dig at some rival treasury companies not doing a good job. 

“There’s a certain amount of money that’ll come to you, that’s easy to get, that’s just not good for you… it’s hard to do the things that are going to create massive shareholder value for your company. It’s easy to get big and do things that basically transfer your equity and your collateral to an investor.”

We used to dream of liberating money from the paper money system we sleepwalked into during the 20th century. Here we are in the 21st, our best and brightest minds — most of them in this very room — trying their hardest to make paper out of bitcoin. 

It’s a nice vision if it works; if it doesn’t, it’ll be disastrous for the orange dream. 

This post Michael Saylor Pushes Digital Capital Narrative At Bitcoin Treasuries Unconference first appeared on Bitcoin Magazine and is written by Joakim Book.

The hangover from the paper bitcoin summer delusion has arrived, swiftly and painfully. We see it, not in the bitcoin price, which is once more calmly and unremarkably ticking upward — pushing up against $117,000 Tuesday evening — but in the stock prices of bitcoin treasury companies. They’re all getting slaughtered: Look at the graphs of $MSTR, Metaplanet, $NAKA, H100, Smarter Web Company and they all look the same — shitcoin-style pump into the heavens, followed by a drawn-out decline back to where they started (or well below it). 

For a while there, we — and the rest of Wall Street — thought anyone could arbitrage financial markets. Issue shares at above their intrinsic value; buy bitcoin; repeat. For this vertiginous summer fling, Wall Street was paying more than a dollar for a dollar’s worth of bitcoin, and everyone’s eyes lit up with dollar signs; this is a trade that, if you’re able to, you’ll happily do all day long. 

But now that that’s over, there’ll be hell to pay — and the devil is already out kicking ass and taking names. 

Oh, and it’s not nice to kick a guy who’s already down (and certainly not when that guy is in some sense your boss…) but given that $NAKA fell a whopping 50% the other day after the S3 PIPE shares restriction period ended — having already collapsed some 87% from its May pump-and-dump peak — it’d be remiss of us price therapists not to take a second look.

So, with the outstanding, tradeable float of shares increased overnight some 50x — and, one would suppose, plenty of second-layer PIPE “insiders” wanna dump-dump-duuuuump — the formula was pretty simple: lots of extra supply meet no demand equals collapsing price. In bitcoin treasury company analyst Adam Livingston’s words: “And you get a perfect physics lesson here: add mass, you lose altitude.”

As usual, bitcoin didn’t care: It jumped almost 2% today, on no material news, after a brief fling downward off its current $116,000 stablecoin pattern. As Bitcoin Magazine Pro’s Matt Crosby says in a recent video, bitcoin price is “poised for breakout.”

The same cannot be said for the poor treasury companies.

Even best-in-class Saylor’s Strategy ($MSTR) is struggling — as it has since operation offload-on-retail began last year; Strategy is gobbling up coins by the hundreds, yet the mNAV compresses more and more, hitting an (unadjusted) yearly low of 1.27. We’re quickly getting to the point where the stock premium (i.e., the source of all treasury company magic) is gone, and the treasury companies become expensive, glorified ETFs.

“Always have been,” the meme world might retort.

Back to our beloved frog, Nakamoto. Baaaaaad things happened to it recently. This is a nasty chart: 

Printing infinite number of copiable paper against a non-credible bitcoin strategy could never have ended any other way. Congrats, NAKA leadership; you wasted six months (or more) of prime bull market real estate playing high finance, and now you’re punished for it.

The delusion that was bitcoin treasury strategy has ended, and the NAKA strategy — running the mNAV-squared treasury strategy — has squarely suffered because of it. (Though, as of this writing, $NAKA is up 20% on the day from its extreme crazy low… yah-yah, nobody cares.)

Livingston is, again, making beautiful sense of the madness: 

“The September 15 crash was not a mysterious market mood swing. It was the predictable result of half a billion discounting shares stampeding through an order book designed for a few million: supply floods, the price sinks, and the physics lesson is complete.”

The everlasting upward magic of (money-share printing) bitcoin treasury companies is gone. Good riddance. Now these companies have to prove real value-add with the corporate-wrapped coins they hold on to so dearly… or perhaps we can go back to de-financializing the economy — you know, that annoying, original reason for Bitcoin. 

BTC Inc, Bitcoin Magazine’s parent company, is affiliated with Nakamoto ($NAKA) through common ownership. BTC Inc also has a contractual relationship with Nakamoto to provide marketing services.

This post Bitcoin Price Hits $117,000 as Treasury Stocks Like MSTR, NAKA Collapse first appeared on Bitcoin Magazine and is written by Joakim Book.

Making Money Work: How to Rewrite the Rules of Our Financial System, by Matt Sekerke and Steve H. Hanke, Wiley, 368 pages, $34.95.

I’m about to do something I’ve never done before, something that’s borderline unforgivable for a book reviewer: review a book without reading it, or even remotely finishing it.

Suppose two well-regarded, established economists at Johns Hopkins University write a long, dense, detailed book on how to make money work better. In the year 2025, no less, the 17th year of our lord Bitcoin’s continued, flourishing existence, they flippantly dismiss this monetary newcomer in a single sentence. In that case, they deserve to have their own book similarly relegated to the dustbins… so I stopped reading Sekerke and Hanke’s book after 33 pages, concluding ceremonially that this title wasn’t worth my time — or indeed the attention of anybody concerned with building a monetary future to fix the monetary ills of our past and present.

“Behind every fiat money used in exchange lies a unit of account defined by a monetary standard [which is] underwritten by credible claims to future surpluses monetized by the government and/or the commercial banking system. […] Claims of a ‘Bitcoin standard’ or anything like it are completely indefensible” (p. 28).

The only reason they see bitcoin trading at a positive price at all — let alone all-time highs — is that malicious actors wishing to use it “must random a large enough quantity in U.S. dollar terms (usually) from existing holders” (p. 33), i.e., a holdup problem:

“Rises in the bitcoin price do not prove the intrinsic value (or network value, or whatever) of Bitcoin any more than a lack of homes for sale in a neighborhood makes those homes infinitely valuable” (fn 48, p. 33).

Like modern monetary theorists, Hanke and his coauthor observe that bitcoin isn’t issued, in the sense of created, by a government and not upheld by that government’s tax receivability, which therefore renders it unimportant and irrelevant for monetary analysis.

This is a crucial misstep, not at all a fault of Bitcoin’s monetary properties, but of the authors’ narrow field of vision.

Bitcoin is for anyone, but certainly not everyone. Some people are just too salty, too infected by Bitcoin derangement syndrome (BDS), too enamored by their own egos, or too stuck in the rapidly devolving status quo. Science progresses one funeral at a time.

BDS, a severe illness at the end of the fiat age, has taken better victims than Messrs Sekerke and Hanke, but it’s still tragic to see. A huge disappointment and missed opportunity for otherwise quite sharp minds to engage with the most interesting monetary phenomenon in our lifetimes.

This is a book review from The Lightning Issue of Bitcoin Magazine Print. Get your copy here.

This post Book’s Books: Matt Sekerke and Steve Hanke, “Making Money Work: How to Rewrite the Rules of Our Financial System” first appeared on Bitcoin Magazine and is written by Joakim Book.

As summer now turns to fall in the northern hemisphere, the stonkcoiner dream of bitcoinizing finance is rapidly becoming a nightmare. The bitcoin paper summer of issuing shares to clueless financial markets at (extreme) overvaluations to thereby buy bitcoin on the cheap is ending, not with a bang of success but with a pretty unimpressive whimper.

The bitcoin treasury dream was nice; I even openly admit that it made some sense. 

For a few months, Wall Street merrily entertained the froth and fuelled the fires. But at last, financial gravity is reasserting itself: We’re all waking up from our summer fling with financial delusion, where things traded for more than what they’re objectively worth. It’s both wonderful and tragic to see standard corporate finance once more hold firm.

Earlier this year, our own David Bailey, CEO of Nakamoto and Chairman of BTC Inc, the owner of Bitcoin Magazine, told Bitcoin for Corporations, another arm of BTC Inc, that “if you can sell a dollar for more than a dollar, you do that trade all day long.”

Turns out, that free-lunch strategy(!) wasn’t free… wiping out investor money in the process has been a painful journey in learning that lesson.

When you — the retail bagholder — are buying a security instead of real bitcoin, you’re typically doing so at a premium (e.g., an mNAV above 1). Perversely, this is both verifiably insane — why buy a dollar for more than a dollar…? — and the very force that animates these bitcoin treasury companies.

Those of us looking at this with justifiable criticism presumed that the mNAVs would come down to roughly 1 via shares falling or staying flat while bitcoin’s fiat price rose. Fate played a trick on us by crashing the bitcoin price instead. In consequence, quite a lot of these airy, financial-alchemy monstrosities fell by much greater multiples.

Bailey’s own NAKA, for which Bitcoin Magazine provides certain marketing services, has been the most amusing (and for many people around these parts, financially tragic). When NAKA announced a major, $5-billion program of share issuance last month, the stock collapsed downward some 30% on the news — and kept tumbling thereafter, down a neat 70% from its initial pump around the announcement of reverse-merging with KindlyMD; $NAKA has fallen a whopping 88% from its highest point in May, recently setting a new low below $3.

Market prices are truth, and the truth here at the dusk of treasury companies’ dreamy delusion is that stuffing corporate balance sheets with retail-amassed equity and debt to acquire bitcoin was no way to the promised land.

“The market price tells you whether you’re right or wrong,” said Moshe Shen, managing director at APAC Wintermute Trading, on Day 1 of the recently concluded Bitcoin Asia in Hong Kong. I guess that tells us enough about the dubious prospects of Nakamoto and other bitcoin treasury companies.

The bitcoin treasury magic ended

The recurring pump-and-dump effect of issuing more shares for a bitcoin treasury strategy no longer come with a great pump to the share price; it falls, as sanity and traditional corporate finance would suggest. It doesn’t matter how many thousands of coins Saylor’s Strategy is eating, the price of MSTR keeps falling, having returned the sum total of zero percent to common shareholders since November last year; Metaplanet, having recently passed 20,000 coins in hyped-upii celebrations has seen its stock fall all the way back to levels not seen before the paper bitcoin summer kicked off.

In a recent article chronicling the treasury phenomenon, Nikou Asgari from the Financial Times remarked sourly that, “The crypto-buying strategy largely relies on issuing shares or raising debt to buy bitcoin and other tokens, hoping that this fuels share price growth.” Understating the point, she continues, “Raising capital becomes harder to do as company valuations fall, however.”

When the share price falls, and the mNAV compresses toward 1, the free-money magic goes away. We’ll find out if the hundreds of treasury companies out there have (any?) viability once the magic money-printing era is over.

Even Tyler Evans of UTXO Management, another Nakamoto-involved company, confessed as much to Asgari in that same FT article: The market “got irrationally overheated,” and that the paper bitcoin summer “was the peak for both hype and for the number of companies launching.”

At the tail end of paper bitcoin summer, we see reality reasserting itself, dramatically recovering from the collective delusion that market prices on the world’s most liquid markets could veer so far off mNAV course.

Here’s a bold prediction: In a year’s time, bitcoin treasury companies won’t be a thing. Most of the lower-tiered ones won’t survive, and will instead spit out the coins they so gluttonously and recklessly gobbled up. The ones with serious moat and competent management teams, like Strategy or Metaplanet, will survive, but see their mNAV shrink to a sliver above zero, where they logically belong.

The paper bitcoin summer has ended, and I for one couldn’t be more excited to see these nightmares go back to the ethereal dreamlands from whence they came.

Disclosures:

Bitcoin Magazine is wholly owned by BTC Inc., which operates Bitcoin For Corporations, a consulting firm focused on corporate adoption of Bitcoin. BFC has a variety of relationships with Bitcoin businesses, including some of those mentioned in this article. UTXO Management is a subsidiary of BTC Inc. Nakamoto is in partnership with Bitcoin Magazine’s parent company BTC Inc to build the first global network of Bitcoin treasury companies, where BTC Inc provides certain marketing services to Nakamoto. More information on this can be found here. 

This post The End of Paper Bitcoin Summer first appeared on Bitcoin Magazine and is written by Joakim Book.

The suits are here, and Bitcoiners are the new hype in financial markets.

That’s been the story for most of this year, culminating spectacularly in the bitcoin price plunge during Bitcoin Asia 2025. Bitcoin, the most vocal vote-of-no-confidence in the permissioned fiat monetary system is now rushing headfirst back into traditional finance.

Cypherpunks, morphed into suitcoiners, have found their ultimate expression as stonkcoiners.

The rebellious teenagers repented their sins. The lost son has returned — in glamorous, greedy glory.

We, the nerdy outsiders who were once dead-set on building a new and improved world have become cheerleaders for regulated, permissioned securities — neatly levered up and financially engineered for maximum bitcoin-per-share. The laws of financial gravity rudely shoved aside, even the staunchest rebellious hacker has given up most of their principles now that Wall Street is paying $2, $3, or $5 for a dollar of bitcoin.

And at Bitcoin Asia in Hong Kong, everything else was upside-down, too. The crowd came out, not for the self-custody or cypherpunk-y Bitcoin talks, but for the political hotshots and financial engineers. (The word “sycophants” comes to mind.)  

The balance sheet is becoming the P&L, said Alexandre Laizet, CEO of Europe’s largest treasury company on stage. He wasn’t merely saying that treasury companies are now banks, using their balance sheets to eke out profits; he meant that the only thing that matters to bitcoin treasury companies is the balance sheet itself. Profits are of no consequence when you’ve got bitcoin-per-infinitely printable share.

“This is what you should do as a rational player in the market.”

Some 200 companies, with Strategy and Metaplanet (the main sponsor for Bitcoin Asia) as the most vocal poster boys for the movement, are vacuuming capital markets for cheap fiat to plunge into bitcoin. Everyone is hitting records everywhere — of audiences and viewers, of attendees and sales. Everyone who’s been around Bitcoinland feels the energy, the building, the never-ending factory floor of shipping and building. It’s never been easier to grasp Bitcoin and we’ve never had as many people here…

…yet the price keeps meandering its way down from a hyped $125,000 to the $118,204 entry point for Nakamoto’s 679-million-dollar purchase to $111,000-ish around conference time, before plunging to a low of below $108,000 — in direct tandem with the bullish speakers on stage.

The drone show on Thursday, lighting up the Hong Kong evening with awesome Bitcoin graphics in the sky, couldn’t have been more symbolic for how everything is upside down. Displaying a powerful 21-divided-by-infinity sign that made absolutely no sense, it was a directly inverted version of Knut Svanholm‘s famous everything-divided-by-21-million claim:

All 20,000-odd of us in attendance need urgent bitcoin price therapy after days on end watching bullish proclamations on the Nakamoto Stage disproven and undermined by the large-font price chart behind them.

From the Nakamoto Stage in Hong Kong, David Bailey sat confidently and celebratory, applauding our great efforts and successes as Bitcoiners — while the audience stared at the large, SALT-sponsored bitcoin price on the screen behind him continually plunging downward, eradicating an ungodly amount of wealth with each downward flick.

The dissonance couldn’t have been greater between the bullish words said on stage, the impressive and plausible-sounding gospel from the dozen or so treasury companies present, and the harsh reality of an ever-decreasing price.

It’s almost like the more David Bailey et al. talk and pump their bitcoin-acquisition vehicle stocks, the worse our market becomes and the lower the price goes.

Maybe Mr. Bailey just has much bigger cojones than me, or a YOLO recklessness far surpassing anything humanity has ever seen, but had I just burned some $60 million of investor money with nothing to show for it, I’d be more humble and skittish, downtrodden and skeptical.

Price is in the pudding, and it’s really not that nice a cake.

It’s symbolic, too, that here in Hong Kong, 2025 is the year of the snake — and we get the cypherpunks’ crowning achievement slithering its way across financialized treasury companies, eating its own tails in the process.

We’re out here on the latest stop of the Bitcoin festival tour, astonished to see how all that was once sacred has been profaned: Everything is upside down.

This is Joakim Book, reporting from a world that no longer makes sense.

This post At Bitcoin Asia Everything Was Upside Down first appeared on Bitcoin Magazine and is written by Joakim Book.

..aaaand, we’re back at it again — a misbehaving bitcoin price. Sunday evening bitcoin flash-crash dipped a red candle the size of Jupiter; and more eerily, it kept dropping down on Monday morning, touching below $111,000.

Now, around here in the land of bitcoin price therapy, we say that nobody knows why prices move. But sometimes, we do… though not as well as we would like. Today, I discuss two things: the last 24 hours’ worth of shenanigans and Fed Chairman Jerome Powell’s remarks late last week. 

An Unruly Bitcoin Price

Late Sunday (European time) was pretty disgusting:

It’s hard to say “nobody knows” when a chart looks like that; somebody knows what happened to plunge the bitcoin price some 3,000 in a matter of minutes. If it’s not a specific macro event, like last week, the only thing eating through order books like this are a) massive orders, and — what amounts to the same thing — b) mass liquidations. 

Yesterday, there was some indication of both: 

or…

This is an underdeveloped market, and it’s ridiculous how small we are and how illiquid the bitcoin market is: still able to get wacked around by individual market actors. (As always in Bitcoinland, there is some schmuck willing to turn a verifiably bad thing into a good thing.) 

The 2.5% instant drop in bitcoin price last night might be a one-off due to a whale selling or some liquidations, but the gradual, diagonally down movement during the night and Monday morning (bitcoin price crashing below $111,000) is much more worrying. Ignore the big, noisy whale… wth is happening? Why are we slowly dying when we should be winning, son!

All the macro arrows of the world are pointing in the right direction: Why is the bitcoin price trading down, in this range, when any sane assessment puts it double or triple from here…? (And no, we didn’t drop below $111,000 as or because or in relation whatsoever to Metaplanet announcing buys).

Price does whatever it wants; shitcos do whatever they please.

Bitcoin price therapy definitely needed: Bitcoin price just does whatever it wants, with no regard for sanity or rational assessment. Not a care in the world for the most bullish of bullish circumstances. Maximum pain, I’ve heard it said. Not even Saylor’s million-dollar-cost averaging made much of a dent:

One of these magic tea leaves reading techniques (128-day moving average), tells us our Bitcoin Magazine Pro team today, is at $108,500… so we’ll probably go there. Saylor et al have already sold their kidneys and chairs, so I wonder what’s left.

More interesting/terrifying is that it keeps falling afterwards, hitting new lows. Our most scoop-like explanation is that all of these shitcos — of which Mr. Bailey, the owner of BTC Inc, runs one, having recently incinerated some $41 million — gobbling up all these coins during the spring couldn’t hold on to them and are now burping them back out again; some, in liquidation-infested red candles, and others in slow, grindy, time-weighted price.

A certain Cypherpunk OG seems aware of the structure:

Bitcoin Price and Powell’s Bowel

Sometimes we actually (sort of) do know what happened in markets — like last week, Aug 22, at 10 am Eastern: Released on Fed website was the statement/upgrade to Fed’s monetary policy framework. It was widely interpreted as future easing of monetary policy in the cards. How do we know this? Because every (hard) asset jump on the minute, and the dollar index fell:

• 9:59:49…bitcoin price = $112,393, according to Bitcoin Magazine Pro’s chart.
• 10:00:49, one minute later, it’s 113459… 
• a few minutes after that, we hit 115,000, bitcoin price rising 2.3% on the news.

This is the kind of shit that moves markets, and the instant, large moves make us pretty confident that THIS is the cause.

(for reference: 9.59, DXY = 98.7; two minutes later, 98.15; another minute, 97.8. That’s 1%, in a blink… That’s a big move for the DXY!)

Now we’ve located the source — Powell’s speech and/or the release of the statement. Which bit of his statement is what shocked markets so?

What happens on releases like this — or inflation numbers or unemployment by BLS — is that simple trading algorithms scrape the websites for instant updates and make a split-second assessment, often with second-order trading effects following. The move itself often get reversed ten, twenty, thirty minutes later when human and intelligent assessment have gotten involved. It was all a nothingburger, after all. That wasn’t the case this time, as the bitcoin price traded high over the weekend (until someone ruined the fun on Sunday…).

Powell’s statements last week revealed that

• inflation is a little elevated, but under control and coming down
• GDP growth had slowed markedly
• unemployment was steady and balanced (but “a curious kind of balance” where both supply and demand fall together) → risks altogether up.
• …and they’ll scrap this entire mistaken idea of average inflation target (over some time period nobody ever specified). 

“In the near term, risks to inflation are tilted to the upside, and risks to employment to the downside — a challenging situation” 

Yet Powell concluded that those risks “may warrant adjusting our policy stance.”

In the minutes and hours after the speech and the release of the statement, bitcoin price peaked at $117,000, before falling back to $116,000; that’s market participants dissecting and assessing, organically, what this new state means.

Here’s where my “Nobody knows why” take still holds: Nobody knows which part of Powell’s statement mattered, since new information is always mixing and merging with the expectation market participants had going in — and we can only rarely tell what those were. What we’re doing when we’re playing these catch-up, ad hoc, after-the-case explanations is playing post-rationalization games. Not that impressive. 

Altogether pathetic. We need Bitcoiners rich and flourishing, not impoverished and distraught.

Bitcoin price therapy out. See you all in Hong Kong for Bitcoin Asia.

This post Bitcoin Price Drops Again — And Nope, It’s Still Not Because of the Fed first appeared on Bitcoin Magazine and is written by Joakim Book.

I hate it when the bitcoin price falls — like it did this week, first from $118,000 to $115,000, and then $115,000 to $113,000 (and then $112,000 while I was writing; rude). It’s nerve-wrecking, terrifying and straight-up infuriating. We’re on this unavoidable monetary revolution and every identifiable sign is pointing in the same, upward direction — alas, the world won’t cooperate and here we are, looking at an otherwise pretty standard -10%-from-top drawdown. 

I get it, it sucks when sways of your net wealth disappear in stomach-churning moves. Advice: don’t ever calculate the dollar amount of what, e.g., the recent -9.2% pullback amounted to for you. Don’t ever look at how many dollars you incinerated in “buying the dip” too early or “catching the knife” while our favorite orange miracle was in free fall.

The Bitcoin Price Didn’t Fall Because Some Talking Head Said Something

On Bitcoin Magazine, like any other financial media involved in click-hungry news, we routinely publish articles about the bitcoin price moving in relation to some macro or political news. It’s not that we, or anybody else, actually believe that price moved on the words of some politician or because Saylor bought more corn or because Metaplanet issued additional stock or because some Hong Kong-based treasury company nobody ever heard of stacked some sats. The bitcoin price didn’t move because the third sentence in Chairman Powell’s latest statement was slightly different than expected.

There’s no sane, rational reason why the bitcoin price ought to hold a certain level (or increase or decrease) because the White House prepares some executive order.

We have plenty of tea leaves readers and technical analysts and macro commentators pitching in, convinced that they know why the bitcoin price moved this way or that. Nobody knows. Bitcoin is too big a macro asset these days to be shoved around by fluff: It moves on the same ethereal and unpredictable changes that move any other asset class — sentiments, liquidity flow, animal spirits, etc. 

We publish these bitcoin price articles because you search for them and click on them and read them. You vote with your eyeballs as much as with your dollars. If you want better journalism, be the change you want to see in the world — read the good stuff instead of the fast-food trash with macroeconomic shelf life of a half-eaten apple (the fruit, not $APPL!).

Here’s a decent enough definition of (efficient) financial markets: all market participants’ best guesses of the future state of things, appropriately discounted back to the present. 

Everything — including, but certainly not limited to, hot news takes like the Trump Administration issuing executive orders or some treasury company buying more bitcoin or issuing more shares — goes into that aggregation-formulaic statement, and out comes a price shift.

Welcome to financial markets. 

You can come at this with technical analysis, and you’d almost never be right; you can make some serious model analysis of liquidity flow or short sellers, etc, and you’ll routinely be proven wrong. No price is beholden to a “psychological limit” of a round number or a 200-day moving average. Price does whatever it does. 

All we can do, as good bitcoin price therapists, is deal with it. Buy more, sell some chairs or kidneys, or close the screen and go for a walk. Nobody knows if hyperbitcoinization is here next week or next century, even though it makes a world of difference to your personal finances which one it is.

David Bailey, Chief Executive Chairman of BTC Inc, the owner of Bitcoin Magazine, and the Forrest Gump of Bitcoin, merged his Nakamoto with KindlyMD and finally got to unleash his war chest of almost $700 million to buy bitcoin. He hit the (local?) top, as so many bitcoin-savers have done over the years, and instantly incinerated about $36 million. (The Swedish treasury company H100 — of which I experimentally hold [very little] stock — was even funnier, hitting a 100 BTC+ purchase at almost $121,000; have fun trashing a million dollars.)

Fun times. 

Here are some other potentially price-moving things that happened recently: 

• Treasury Secretary Bessent said the U.S. wouldn’t buy bitcoin for the strategic bitcoin reserve — and then, for maximum confusion, walked back his words a few hours later. 
• Allegedly, Cathie Wood’s Ark 21Shares sold bitcoin recently.
• Macro: speculation about Fed lowering rates in September (or holding them steady).
• The stocks of bitcoin treasury companies, including and especially Strategy, fell like crazy this week too… with suspiciously little activity. 

That’s all the therapy you get this week. Go touch some grass and may the sun shine brightly on your face.

The opinions expressed in this article are the author’s alone and do not necessarily reflect the opinions of BTC Inc, BTC Media, Bitcoin Magazine or its staff. The article is provided for informational purposes only and should not be considered financial, legal or professional advice. No material non-public information was used in writing this article. Opinions, and financial actions taken as a consequence of those opinions, are those of the author’s and do not necessarily reflect BTC Inc, BTC Media, or Bitcoin Magazine. 

Nakamoto has a marketing partnership with Bitcoin Magazine’s parent company BTC Inc to help build the first global network of Bitcoin treasury companies, where BTC Inc provides certain marketing services to Nakamoto. More information on this can be found here.

This post Bitcoin Price Falls — And As Usual, Nobody Knows Why first appeared on Bitcoin Magazine and is written by Joakim Book.

Kenneth Rogoff spoke, and the Bitcoin hornet’s nest awoke. 

When the celebrated Harvard economist and former chief economist at the IMF yesterday publicly confessed that he was wrong on Bitcoin, he didn’t do so gracefully; instead, he doubled down. You see, it wasn’t that his prediction in 2018 of Bitcoin’s imminent doom and the bitcoin price to quickly collapse was wrong; it was

1. Trump crypto regulation was beneficial instead of the needed crackdown
2. Bitcoin was embraced and (shockingly) used by criminals, and
3. Trump “brazenly hold hundreds of millions … of dollars in cryptocurrencies seemingly without consequence.”

I mean, talk about willful ignorance. Scooby-Doo called and wants his villains back (“I would have gotten away with it, too, if it weren’t for you meddling kids”). There’s no other value to this thing, no other censorship-resistance use case, no savings-outside-the-shady-banks option, no instant global payments over Lightning?

Even in that 2018 CNBC interview, Rogoff said regulation of the sector would lead to lower prices, not a catalyst for higher ones, as he now pretends. This smells like a salty rationalization, not a serious analysis. 

Slay Your Heroes, Always

Rogoff’s excellent book, This Time Is Different: Eight Centuries of Financial Folly, and especially the freely available data behind the research for dozens of countries over hundreds of years, was a godsend during my university years. I learned so much from him. 

When I finally met Rogoff in 2018 or so, it was a total “kill your idols” moment. He had just released his unfathomably stupid book The Curse of Cash — about how we should ban cash because criminals… and cash also makes monetary policy transmission worse and negative interest rates more difficult to impose. I was trying to explain to him the virtue of competitive note issuance and monetary freedom. To my shock, he was sputtering nonsense about free banking and falsities about U.S. banking history, let alone the past monetary arrangements of Canada, Scotland, or Sweden, of which he knew nothing.

The moment really stuck with me. I was young and not yet that disillusioned with elite knowledge and the much-revered academic establishment. But I was speechless that a famous Harvard professor didn’t know better… what, the skills and cognitive faculties and hard work that got you here have now been completely eroded? 

It was around this time that I started saying,

The most important thing I learned at Oxford was that you can have a PhD and still be an idiot.

It was a wake-up call of astronaut-meme proportion: I was in the big leagues, the hallowed halls of wisdom, interacting with the big names, talking to the smartest and most celebrated of economists and economic historians in my field… and it turned out they were unread in all the things that matter. I remember a night in Oxford when I had to explain to a well-respected historian how loans in one bank end up as deposits in another, thus multiplying the (broad) money supply. Textbook stuff.

Elite university profs can be stupid…? Yeah, totally. 

Bitcoin derangement syndrome, BDS, is a big, bad monster that’s taken many bright minds away from us, well before their time. Many fiat elites became too enamored by their own egos, too stuck in the status quo that, by the way, has benefited them enormously. They often become blind to the errors of their past opinions. 

The correct intellectual approach when reality behaves differently from what you expected is to reassess your model. Maybe you got something wrong?

The reasonable reaction to the bitcoin price doing 13x (+1,220%) in the seven years since you loudly proclaimed its imminent death is to change your mind. (For reference: U.S. official CPI: +29%; U.S. median earnings: +38%; S&P500: +146%.)

Maybe I missed something, you ought to ask yourself. Maybe there’s something here that I couldn’t see. Maybe, just maybe, there’s true value in this worthless, speculative, technobabbling disaster?

I have lost almost all of my respect for legacy academics; we definitely need new institutions of (higher) education. Bitcoin is for anyone, but not everyone, and people get bitcoin at the price they deserve.

For all I care, Rogoff can join the likes of Elizabeth Warren at the back of the line.

This post Who Rugged Rogoff? first appeared on Bitcoin Magazine and is written by Joakim Book.