We had an awesome chat during Meshtadel on the 8th 🙏🏻. We talked about so many cool things, and one topic that led me to writing this note was P2P trading (Sats to fiat and/or products).

A lot of Bitcoiners prefer (and they're totally right) P2P trading but here's the deal: most of these P2P trade prices are based as a premium on the current spot price which is determined by comparing the broadcasted value on centralized exchanges (automatically by the P2P exchange or by the actors themselves). Now we are all cheering for the liquidity on those exchanges lessen since this means more traders become HODLers, getting their sats off the exchange, leaving only those sats on the exchange that are A) an urgent sell (a HODLer depositing Sats he plans to sell due to whatever need) B) people who were planning to sell anyway (and C) owned/custodied by the exchange which is one of the argumentations to get our sats off the exchange)

So all that we have on those exchanges is A) sell pressure, B) Weak hands (and C) Manipulation utxo's)

Not arguing to use centralized exchanges more, but rather asking the question: Is there not a better way for P2P price discovery than what we are seeing now.

The answer of the "why" for the current situation is in my simple understanding (read: I am just guessing ) : this is what the market demands. But the market demands that because the market is looking for a measuring stick.

As a lot of Bitcoin-'educators' pointed out already: Fiat is a broken measuring stick, but even when trading P2P we are still falling for that broken measuring stick.

Maybe it is time for the Sat/egg index 🤭. The amount of Sats that the market valuates a specific daily useable good that is sensitive to inflation, preferably fulfilling one of the basic needs (such as in the egg example food.)

Maybe revhodl@vida.live could create a Sats-to-Lamb index we can follow 😉

#Mesthadel #MeshtadelMushings