This won’t be popular. Maybe you need a Monero?
From Shanaka Anslem Perera on X
The Silent Seizure of Bitcoin Has Already Begun
What took governments 15 years to fail at through regulation, Wall Street accomplished in 18 months through optimization.
The numbers don’t lie … they scream:
BlackRock’s IBIT alone: 802,000 Bitcoin. That’s 4% of all Bitcoin ever mineable, held by one entity. Total US spot ETFs control 1.25 million BTC … 6.3% of circulating supply … concentrated in Coinbase vaults.
Since July’s SEC approval of in-kind transfers, over $3 billion in Bitcoin has moved from self-custody to institutional control, enabling 20-37% tax deferral while capturing an additional 5-7% of supply within 12 months.
Here’s what nobody’s connecting: On-chain transaction volume has collapsed 15% since Q2. Addresses holding more than 1 BTC are declining 8% quarterly …. the first reversal in Bitcoin’s 15-year history.
Economic nodes dropped from 60,000 to 52,000. The Lightning Network has stagnated. Fee revenue is evaporating while mining costs remain fixed, threatening network security itself.
Meanwhile, 30-day volatility compressed from 45% to 38% … projected to hit 30-35% by 2026. This mirrors gold’s trajectory post-ETF launch: 40% volatility reduction in three years, 30% supply centralization by 2010.
The mechanism is surgical: Low-basis whales swap Bitcoin for ETF shares tax-free. Custody transfers to Coinbase. Supply disappears from circulation.
Price discovery fragments … spot markets now represent just 45% of volume, down from 80%, while CME and ETF flows dominate at 55% combined.
But here’s the systemic risk nobody’s pricing in: ETF sponsors retain sole discretion to select the “valid” chain in protocol forks.
When custodians controlling 6-10% of supply signal their preference, they effectively veto contentious upgrades … privacy enhancements, scaling improvements, anything non-compliant with AML regulations.
This isn’t theoretical. Bitcoin Cash’s 2017-2018 forks left 16-17% of nodes stranded when economic majority chose differently.
The parallels to 1933 are haunting: FDR’s Executive Order 6102 confiscated gold at $20.67, then revalued to $35 …. a 69% wealth transfer. The mechanism? Centralized custody.
Today’s ETFs create identical seizure vectors, but the confiscation is voluntary, incentivized, and irreversible.
Top four mining pools control 55% of hashrate. US geographic concentration sits at 45%. AWS hosts 75% of relay infrastructure.
The 51% attack vector has quietly shifted from nation-state adversary to state-custodian cooperation.
We’re witnessing the transformation of rebel money into spreadsheet collateral. Bitcoin’s success as a reserve asset is simultaneously its failure as sovereign money.
Arrow’s impossibility theorem proves itself at scale: you cannot have decentralization, institutional adoption, and protocol sovereignty simultaneously.
By 2030, projections show 70% supply capture by compliant custody. Price may hit $200,000+.
Volatility may compress to equity-like levels. But the asset that reaches that milestone won’t be the Bitcoin that started this revolution.
The speciation has already begun: BTF (Bitcoin TradFi) versus BTS (Bitcoin Sovereign) …. two chains, two visions, two incompatible futures.
What matters now: custody concentration above 10% triggers protocol ossification. A custodian hack exceeding $5 billion reverses the trend.
Bitcoin below $50,000 forces mass redemptions and self-custody resurgence.
The choice crystallizes: allocate 50-70% to self-custody for sovereignty, 30-50% to ETFs for liquidity …. but understand that threshold risk at 20% concentration signals the point of no return.
This isn’t evolution or corruption. It’s something more profound: proof that scale itself is incompatible with pure decentralization.
The question isn’t whether Bitcoin will be captured .. it’s whether what remains after capture still deserves the name.
