in one The latest episode of the Galaxy Brains podcastMichael Seiler argued that Bitcoin is not a currency and that it is better to think of it as capital and capital only.
He also shared that Tether (USDT) and USD Circle coin (USDC) are real cryptocurrencies and revealed his “evil genius strategy” (as he called it) to force the world to accept USD stablecoins instead of Bitcoin. removed
in this take itI'll quote some of Silver's own words from the podcast before explaining why many of the points he made are baseless.
Capital, not currency
“It's not a currency, it's capital,” Silver said halfway through the episode.
You just have to deal with it – it's not digital currency. This is not digital currency. Capital is digital. This is crypto capital.”
I searched Bitcoin White Paper To see how many times the word “capital” appears.
Not mentioned once
However, both in the title and in the abstract, Bitcoin is referred to as “electronic cash”. While cash can of course be capital, it is not just capital. To think of Bitcoin only as capital is to deny some of its most essential features – such as the ability to use it to make unauthorized transactions with anyone anywhere in the world.
To deny Bitcoin as a currency is to deny a large part of its value proposition. Bitcoin's role as a store of value (SoV) and a medium of exchange (MoE) are inextricably linked. For more information on this, I recommend you (and Michael Siler) read the article by Breeze CEO Roy Sheinfeld. “Bitcoin's False Dichotomy Between SoV and MoE”.
As the episode continued, Sailer continued to (weakly) explain why Bitcoin is a capital, not a currency.
There are many maxes who say no, we want it to be currency. We want to be able to pay for coffee with our bitcoins. Pay me in Bitcoin.” “It's like giving me gold money. Pay me in a building Pay me with a piece of your professional sports team. Pay me with a Picasso.”
In fact, it is not like that at all.
Sure, Bitcoin is scarce, somewhat like gold, Manhattan real estate, sports teams, or famous paintings, but it has a number of other characteristics that make it very different from other assets.
To illustrate some dimensions of that point, I quote my colleague Alex Bergeron:
I encourage anyone who thinks bitcoin is like gold to start a gold wallet.
I will wait
— Alex B (@bergealex4) December 22, 2024
And then Silver referenced Federal Reserve Chairman Jerome Powell's take on — wait for it — bitcoin in an attempt to make the point that bitcoin is capital, not currency.
“The reason Bitcoin crossed $100,000 is because Jerome Powell told the world on stage, Bitcoin is not competing with the dollar, it's competing with gold,” he said.
Oddly enough, Siler said this without acknowledging that the man who said this is the head of the institution that Bitcoin should theoretically replace.
USDT, not BTC
In this interview, Sailer also pointed out that the real digital currencies are US dollar stablecoins.
“The digital currency is Tether (USDT) and Circle (USDC),” he said. “It's a US dollar stablecoin – it's digital currency.”
This is when I started to feel nauseous.
For those who don't know yet, Bitcoin entered the world after the Great Financial Crisis of 2008, when the US government along with the US Federal Reserve decided to print dollars. a lot (Currency devaluation) to bail out failing banks, the burden was on American taxpayers and US dollar holders around the world.
Bitcoin is a decentralized currency created as an alternative to the US dollar and other fiat currencies. Trying to convince people that Bitcoin is not that is disingenuous at best and deeply manipulative at worst.
But that's not even the worst thing Silver had to say in this episode.
He went on to suggest that banks bailed out in the 2008 financial crisis issue their own stablecoins, which would help shore up the US debt market.
“They need to create a normal regime for issuing digital currency backed by the US Treasury,” Seiler said.
The United States should have a framework for Tether to move to New York City. That's what you want, right? And then you should basically have a free-for-all where JP Morgan or Goldman Sachs can issue their own stablecoin.
No, Michael Seiler, that's not what I want. It is actually far from what I want.
I don't want Tether anywhere near New York City (my city) and I don't want JP Morgan and Goldman Sachs issuing USD stablecoins that they control, which is essentially the CBDC equivalent.
When I think of Goldman Sachs, the first thing that comes to mind is award-winning author Matt Taybi's description of the firm. The New York Times best seller Griptopia.
“The first thing you need to know about Goldman Sachs is that it's everywhere,” Tayyibi said in the book. “The world's most powerful investment bank is a giant vampire squid wrapped around the face of humanity, mercilessly sticking its blood funnel into anything that smells like money.”
Goldman Sachs, much like the US Federal Reserve, is an institution that sucks the life force out of humanity. Bitcoin is designed to take power from such institutions, not strengthen them.
At the end of the episode, Siler presented his original plan for Bitcoin and the USD stablecoin.
Here it is:
“Anyone outside the US would give their left arm to be invested in US bonds. So, my strategy would be – and I really think it's an evil genius strategy. It's so good that our enemies hate us, but our allies complain too. And the US would make $100 trillion in a heartbeat.
The strategy is this: you drop the gold, you remove the entire gold network from the money. You buy bitcoins – 5 million or 6 million bitcoins – and you earn money from the bitcoin network. All the capital in the world, in Siberian real estate or Chinese natural gas or any other derivative currency held as a long-term store of value – the Europeans, the Africans, the South Americans, the Asians, they're all just holding their worthless assets. they leave They buy inappropriate capital assets and bitcoins. The price of Bitcoin goes to the moon.
The United States is a big profit. American companies are the big beneficiaries. And while you're at it, you're normalizing and backing digital currency, defining digital currency only as US dollars backed by US dollar equivalents in an audited US regulatory custodian. . What happens next?
$150 billion of stablecoins becomes $1 trillion, $2 trillion, $4 trillion, $8 trillion, probably somewhere between $8-16 trillion, and you create $10-20 trillion in demand for US government debt.
While you are reducing the demand a bit as the capital asset of Bitcoin grows, you are increasing the demand to support the stablecoin. (in which case US digital dollar) replaces CNY, ruble. It replaces any African currency. This currency replaces any South American currency. It replaces the euro.
If you really believe in the US global reserve currency and US values, every currency in the world would actually be pegged to the US dollar if it were freely available.
At this point, I stopped listening to the episode and projectile vomited all over the New York subway car I was sitting in.
I didn't get into the bitcoin space to help the US implement a plan where they get a large percentage of bitcoins while locking the world in their junk currencies, and that someone who has a large number of The Bitcoin space is looking for it, it deeply saddens me. It is committed to such a program.
Bitcoin is money
Bitcoin is money. It's the kind of money that can't be censored or denigrated, and its value has increased dramatically over the past decade, making it one of, if not the most, powerful tool ever created for people.
To call it anything less, or to try to convince people that a new iteration of a current version is better money than it is, is deeply misinformed.
While Bitcoin is capital, it's not everything, and please don't let Michael Siler or anyone else convince you.
This article is one take it. The opinions expressed are solely those of the author and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
