Where are you at in your Bitcoin journey?

#asknostr #bitcoin #nostr #confidence #knowledge

Hmm…I just turned off the private mode…. Not sure if that is the reason or not…. Thank you for being my test subject 😀

Yes still doesn’t work

Can’t zap you btw ??

Long post incoming:

I translated the following from a CCP propaganda outlet. This is useful in knowing what the Chinese state feels comfortable with their people knowing about bitcoin, CBDC’s and stablecoins.

“Recently, the United States announced its strong support for the development of cryptocurrencies and crypto assets, and announced that it would build a national Bitcoin strategic reserve. This policy measure has greatly stimulated the discussion and imagination of digital currency around the world. Digital currency is a new type of currency that exists in digital form, based on cryptographic technology, distributed ledger and other technologies, with the characteristics of decentralization, traceability, non-tamperability, etc., and can be used for transactions and value storage, including legal digital currency and virtual digital currency. Its rapid development not only provides new monetary forms and asset classes, but also may have a significant impact on the restructuring of the international financial system.

Three types of digital currencies and their characteristics

At present, there are three main digital currencies in the world, including cryptocurrencies represented by Bitcoin, stablecoins represented by USDT and USDC, and central bank digital currency (CBDC) represented by digital RMB (e-CNY). These three digital currencies have their own characteristics.

The value of cryptocurrencies is neither determined by national sovereign credit nor by other currencies or financial assets linked to the currency, but by a set of rigorous computer algorithms. For example, Bitcoin is determined by a set of computer algorithms and needs to be generated by a high-performance computer with powerful computing power through "mining". The total amount of bitcoins is fixed, and it is set to 21 million by the algorithm. At present, there are about 19.8 million bitcoins circulating in the market, which means that there are only about 1 million bitcoins waiting to be discovered by "mining" in the future. The most important feature of Bitcoin is decentralization, and its generation is not linked to any national credit. Coupled with its fixed total amount, which is similar to gold, can overcome the inflation tendency of any central bank, so it is considered to be used to hedge against country currency risks. The biggest problem with Bitcoin is that its price fluctuates greatly. The peak price of a bitcoin once reached more than $100,000, and fell to about $86,000 in early March 2025.

The value of stablecoins is determined by other currencies or financial assets it is linked to. At present, the most popular stablecoins on the market are USDT and USDC, which together account for about 90% of the global stablecoin market value. As the name implies, both USDT and USDC target the US dollar at a 1 to 1 exchange rate, so they are also known as the US dollar stable currency. In addition, there are also stable coins that target the euro, gold, cryptocurrency and a basket of commodities. To issue a unit of stable currency, a fixed amount of currency or financial assets must be supported. Therefore, the price of stablecoins is much more stable than that of cryptocurrencies with huge price fluctuations.

The central bank's digital currency refers to the digital currency issued by the central bank of a specific country. This kind of digital currency is supported by a country's sovereign credit and is linked to the country's ordinary currency at a ratio of 1:1. The biggest advantage of the central bank's digital currency is that it is issued by the central bank of a country. When its value fluctuates significantly, it can be supported by the function of the central bank's last lender, so the financial risk is very low. However, the reputation of the central bank's digital currency is affected by the country's ordinary currency. If the exchange rate of the country's common currency fluctuates greatly or the purchasing power depreciates quickly, the attractiveness of the country's central bank's digital currency is naturally weak.

The impact of Bitcoin on the international financial system

Although Bitcoin is a kind of digital currency, it cannot really perform the function of currency because of its following two characteristics. On the one hand, the huge fluctuation of the price of Bitcoin determines that it is difficult for Bitcoin to be used as a monetary medium for the pricing scale of other commodities and other commodities to trade with each other; on the other hand, due to the limited total amount of Bitcoin, it is difficult for Bitcoin to regulate the operation of the economy as a currency. Under normal circumstances, as the total amount of the economy rises, a country's central bank will continue to issue new currencies to meet relevant needs, and the total amount of a country's currency is usually growing.

Therefore, the nature of Bitcoin is not a real currency, but a financial asset with a strange style, which itself has investment value. Whether Bitcoin is a risky asset or a risk-averse asset is controversial in the market. In terms of the huge price fluctuations of Bitcoin itself, it is more like a risky asset. However, judging from the fact that the price trend of Bitcoin is largely inversely related to the trend of the US dollar exchange rate, it is like a safe haven asset that can hedge against fluctuations in the US dollar exchange rate.

The impact of stablecoins on the international financial system

Among the three digital currencies, it is the stable currency that may really have a major impact on the international financial system. As mentioned earlier, because stablecoins are linked to sovereign currencies, they indirectly have the nature of sovereign currencies. The US dollar stable coin has the relevant characteristics of the US dollar. Overall, the exchange rate is relatively stable, so it is easier to be accepted by investors.

In recent years, the global stablecoin market value has developed rapidly, and by the end of 2024, it will be close to 180 billion US dollars. At present, stablecoins are "attacking the city" in the following areas: First, US dollar stablecoins have begun to become the trading medium of the cryptocurrency market. In other words, when trading between Bitcoin, Ethereum and other cryptocurrencies and other currencies, both parties are increasingly inclined to pay with US dollar stablecoins. This means that in the virtual world, the US dollar stablecoin has begun to play the role of the US dollar. Second, in the decentralized financial system (DeFi), some institutions have begun to provide liquidity support with US dollar stablecoins. For example, when the relevant subject needs a loan, it can directly apply for a US dollar stablecoin loan from a specific institution. Third, in some developing countries where the purchasing power and exchange rate of their currencies fluctuate greatly, residents and enterprises have begun to use the US dollar stable currency as a reliable international currency to store wealth, and the US dollar stable currency has even begun to replace the domestic currency to a certain extent.

The stable currency of the US dollar not only strengthens the connection between the traditional currency circulation domain and the currency circulation domain of the virtual world, but also fills the gap in the demand of some families and enterprises in developing countries for the US dollar. Therefore, this digital currency is likely to strengthen the international monetary status of the US dollar in the international financial system. Once the US dollar stablecoin connects the international credit of the US dollar more closely with the application scenario of the virtual world, it may greatly consolidate the hegemony of the US dollar.

The impact of the central bank's digital currency on the international financial system

The central bank's digital currency is actually the sovereign currency in the virtual world. This currency has a stronger reputation and lower risk, but ultimately it depends on the competitiveness of the country's real currency. Of course, it is also an important issue at what level this central bank digital currency can be used. For example, the RMB is globally recognized as a sovereign credit currency with stable value. However, so far, digital RMB can only be used in retail scenarios, that is, transactions between individuals and enterprises, and digital RMB can only replace cash (M0) at present. Subject to this restriction, transactions between enterprises, between enterprises and financial institutions, and between financial institutions are not applicable to digital RMB at present. This means that the main restrictions on the use of scenarios are currently inhibiting the development of digital RMB. The reason why the Central Bank of China only allowed it to replace cash (M0) at the beginning of the digital RMB trial is that this is a less impact on the current commercial banking system.

Coping strategy

At present, there are three development directions of global digital currencies: cryptocurrency, stablecoin and central bank digital currency, each with its own advantages and disadvantages, development prospects and application directions. It's best not to bet on only one side, but should bet on three ways and bet at the same time to maximize the dividends of digital currency or digital asset development. On the one hand, expand the substitution range of digital RMB from M0 (cash) to M1 (cash plus demand deposit) or even M2 (cash plus all deposits) as soon as possible. Only by upgrading the substitution scope of digital RMB from M0 to M1 or even M2 can we comprehensively expand the application scenario of digital RMB, promote the domestic and foreign use of digital RMB, and help the internationalization of RMB. On the other hand, promote the construction of China's stable currency. Expand the use of digital tokens on the Internet platform, and better combine the sovereign credit of RMB with the global application scenario of the Chinese platform. As long as the design and risk prevention are appropriate, expanding the use of digital tokens on these platforms can significantly expand the international monetary status of the RMB, so as to meet the challenges of the US dollar stablecoin more calmly. In addition, the trial and promotion of digital special drawing rights (e-SDR) can be encouraged at the level of the International Monetary Fund (IMF). The Special Drewing Rights (SDR) is a super-sovereign currency created by the International Monetary Fund. It targets the currency basket composed of the US dollar, euro, RMB, Japanese yen and British pound. At present, the weights of the above five currencies are 41.73%, 30.93%, 10.92%, 8.33% and 8.09 respectively. %. At present, SDR can only be used for transactions between the IMF and member countries, and between member countries. A variety of digital currencies are blooming together, which is naturally better than the US dollar's monopoly on the digital currency development track. e-SDR can expand the use of super-sovereign reserve currencies in the digital field and virtual space, and also help promote the diversification of the international monetary system.”

(The author is the deputy director of the Institute of Finance of the Chinese Academy of Social Sciences and the deputy director of the National Laboratory of Finance and Development)

Interesting! What book is that?

Do you believe in God?

If not, should we establish a Strategic Belief Reserve,

according to this game theory??

But if the belief is strategic, is it truly belief at all???

#asknostr #bookstr #philosophy #god

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A Quantum Leap in the Open-Source Bitcoin Home Mining Revolution.

I created Bitcoin Education playing cards and Bitcoiners around the world love them. I'd appreciate a share to get the word out. Payment in sats preferred. Peace and love 🧡⚡$boost