Pizza day

market vibes

October 20… )  

“Bitcoin is a limited supply of nothing.” John Paulson. “Bitcoin is a fraud, a pet rock.” Jamie Dimon. “Bitcoin is the mother of all scams.” Nouriel Roubini  

On October 31, 2008, a pseudonymous person or group known as Satoshi Nakamoto introduced a bitcoin white paper to the world. The first block of the blockchain, known as the Genesis Block, was mined on January 3, 2009. Thus, on that date, Atlas shifted the ancient weight of gold heavy on his shoulders to make room for crypto and a new financial era was born. Will it endure as gold has endured for thousands of years?   

As of October 2024, around 1.4 million Bitcoins have yet to be mined out of a capped supply of 21 million. These remaining coins will be mined over the next approximately 116 years. The last is expected to be mined around the year 2140. This is hardcoded into the protocol, meaning it cannot be changed by anyone, including the developers or miners according to sources on X and the web. The value of all the coins mined to date at settlement Friday equals ca. $1,332,800,000,000 or about .07% of the market cap of all known above ground stocks of gold or .08% of the magnificent 7. Small by any measure. Unmined bitcoins will not have a material impact on prices because there are so few remaining.  

During the early years bitcoin empowered black markets in illegal services and tax-free transactions. In 2011 an online operator and founder of the infamous Silk Road, Ross Ulbricht, was arrested and sentenced to life in prison without parole, highlighting the consequences for tax evasion which gave rise to the enormity of AML compliance. Many people think his example was intended to staunch bitcoin’s threat to the traditional financial order. However, Bitcoin and other cryptocurrencies are still used every day for illegal activities.   

Let’s fast forward to September 8, 2021.   

The world’s most “it” couple, Tom Brady and Gisele Bundchen inked a deal with the golden boy of crypto Sam B Freid to rep FTX, a crypto exchange valued at 25 billion. Fourteen months later FTX filed for bankruptcy. It was quite a story, much of it yet to be told. Brady served as a brand ambassador appearing in marketing campaigns and commercials to attract users to the platform and he did it well. He believed.   

Tom and Gisele owned a combined 2 million shares of FTX stock and their losses according to people.com and the New York Times totaled nearly $50 mm dollars. They are still embroiled in the mess due to his endorsements and a class action suit. Recently P Diddy was arrested for sex crimes putting Epstein and Gislaine Maxwell on the bunny hill of bad… and wait for it, he’s rooming in plush detention with SBF. Poor Ross Ulbricht sits in his cell like a two-bit dealer busted for selling a few joints in Hollywood and sent to prison for life.   

The set up

As of September 25, 2024, there were 34 listed bitcoin ETFs including 12 spot bitcoin ETFs, which hold unallocated or “pooled” bitcoins supporting share-creation. And 22 ETFs that "hold” bitcoin futures (wow) instead of physical bitcoin. I will remind the reader an ETF entitles the owner to participate in the return of the underlying assets, not ownership (or convertibility) of the underlying asset. A bitcoin ETF is not a bitcoin just like SLV and GLD are not gold and silver.   

A bitcoin futures ETF is the right participate in the return of an actively managed portfolio of cash settled futures contracts. The fund managers hold futures and if the futures suffer severe losses the fund could be forced to liquidate them. The implications of that are obvious.   

In April, Cathie Woods said bitcoin was going to $3.8 million. In August, Donald Trump told his 90 million followers on X that he would lay out “a plan to ensure the United States will be the crypto capital of the planet”

The hook (lol)