Paper Bitcoin Summer roadtrip LFG! đźš—
Discussion
Next track 👇🏻
https://wavlake.com/track/76e11af0-a710-4948-98b4-0fd6ede55e85
Or the whole album…cheers
https://wavlake.com/album/4a68b70e-9c0e-4845-b27a-0bb0c780680d
Can you explain paper bitcoin to me? Is it the belief that these publicly traded companies don't actually have the BTC they say they do?
What's the basis of this? Wouldn't that mean that all of these companies are committing securities fraud?
Not necessarily, but it wouldn’t surprise me if some did that anyway, because if the temptations. Something like this happens every cycle. “Paper bitcoin” mostly refers to derivatives and contracts issued against the underlying asset, usually with lots of juicy leverage. They’re trading on price movements. Do you know if all these firms and exchanges engaging in this activity have all the reserves they claim to? Is it different this time?
No we don't know that. But if you look at the whole sector of treasury companies, currently they have an mNav of 1, which means to me that there currently isn't excessive risk, and if anything it's under valued bc the market is writing off all of the business value creation and/or future #BTC accumulation. I would be much more concerned when that multiple expands, but wallstreet is so skeptical that I doubt it will allow for that to happen.
I remember 2022. At some point someone will get too greedy and the contagion will start. As is tradition.
Fair point.
But, I think the more logical fear is how these companies perform in a bear market or a liquidity squeeze or any kind of downward pressure environment. If we look at the current macro setup, we aren't even close to that, and I think the BTC price has room to run as well as the treasuries companies.
We need more restaurants accepting and holding real bitcoin. They will be the ones who inherit the earth.