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If Bitcoin’s price were being suppressed, who would be responsible?

Would it be the custodians holding paper Bitcoin for institutions? The institutions selling paper Bitcoin to the public? The influencers convincing people to buy it? Or the people naive enough to trust what they’re buying is real?

Is Wall Street to blame for wielding market setting power through futures, ETFs, and custodians? Or is it the people who abandoned the spot market, allowing paper claims to dictate the price of real Bitcoin?

I don’t have all the answers, but one thing is clear: suppression only strengthens the case for self custody.

This entire system of paper Bitcoin could collapse if everyone took possession of their BTC. Because as long as demand isn’t 100% for real, on chain Bitcoin, there’s room for manipulation.

Paper Bitcoin is fiat; just as paper gold is fiat. It’s an illusion of supply, no different from printing more dollars or inflating the max Bitcoin supply. Yet few seem to recognize the implications.

Price suppression? People shrug it off. But millions of fake Bitcoin circulating in markets, diluting real BTC’s value? That should raise alarms.

The difference between real and fake Bitcoin is simple: you can’t take custody of fake Bitcoin.

Self-custody was never the problem. It has always been the solution.

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Discussion

hongumart 10mo ago

I thought institution bitcoin was being tracked on chain?

My suspicion for price suppression is third parties/exchanges. I think we should look at a more decentralized pricing method, such as UTXOracle.

Seth Michael Steele 10mo ago

Great clarification, by institutions I’m talking more of those pushing paper bitcoin than those stacking themselves.

However, the ones who do stack themselves might inadvertently be stacking paper bitcoin by proxy depending on who they custody with and if that custodian is the same third party/exchange we worry about.

This ought to be verifiable on chain, but this isn’t always the case. In scenarios where this isn’t the case, you run the risk of paper bitcoin.

I do like your decentralized pricing method though. I haven’t thought about that route often, rabbit hole time 😂

hongumart 10mo ago

Ah ok. So are you talking about people trading bitcoin outside of exchanges and not physically moving the bitcoin on chain?

Seth Michael Steele 10mo ago

I think any bitcoin I don’t hold the keys to might be paper. If I leave coins on Coinbase, I trust Coinbase. If I have ETFs, I trust Coinbase Prime and Fidelity. If I hold strategy, I trust Coinbase Prime and Fidelity.

This is the cycle of 4th party risks. The custodial entanglement can only be compared to the lines drawn on my conspiracy board.

ITS ALL CONNECTED😂

But, I don’t know who to blame because it’s a result of centralization and complacency.

BTCrevolutionary 10mo ago

This is what you get with institutional adoption. Be careful what you wish for and all that. This is why it was always a bad idea for them to get in this early

Seth Michael Steele 10mo ago

Agreed! I was curious how it would turn out. Still more to witness, but I think I’m getting the idea.

BTCrevolutionary 10mo ago

I think they will buy Bitcoin but use it to back the dollar.. basically swapping treasuries for Bitcoin. Same system new asset.

Seth Michael Steele 10mo ago

That’d be pretty ironic, Bitcoin, created to fix monetary debasement, used to prop up the dollar and allow more monetary debasement, if it remains a debt based system. Same game new pieces.😭😂

Glad I’m not the only one with wide eyes about it.

BTCrevolutionary 10mo ago

It can go either way at this point.. definitely trending towards bitcoin backing the dollar and not the revolution we are looking for