It is the inflation concern, idiot!

Let me continue the topic about bitcoin as it is so hot so far, we cannot pass a day without some excitement about it nowadays!😄 It is truly fun to write about it.

Today, let me talk about the negativism about bitcoin as this has been associated with it since its birth just about 10 years ago. Actually about 3 years ago, I posted a blog  Bitcoin has been pronounced dead hundreds of times. Now with so much euphoria established for it, you may think there should not be much negativism on it anymore, right? Wrong! We are still seeing and hearing a lot from naysayers why bitcoin is pure speculation and is doomed to die sooner or later. There are two types of naysayers broadly speaking. One is those who are genuinely ignorant about this new tech revolution and cannot really understand it. Buffett is typically one of such guys, who called bitcoin "rat poison". I can only laugh about his ignorance about bitcoin, just like his ignorance about the value of gold. But the other type of bitcoin naysayers have a lot more deceptivity. Given their expertise in the relevant areas, they should be very well knowledgeable about bitcoin about its utility as a great store of value but they  still openly criticize or even vilify it! These kinds of people have a lot more cheating power due to their authority. I can give you two examples: one is the JP CEO, Jamie Dimon who called bitcoin a fraud. We later found out that actually his daughter was a big fan and bitcoin hodler. The other example is the current Treasury Secretary, Janet Yellen, who was the previous Fed chair. Here is what she recently said: 

 

Cryptocurrencies are "a particular concern" when it comes to terrorist financing, potential Treasury Secretary Janet Yellen said Tuesday.

Speaking at a Senate Finance Committee hearing on her anticipated nomination after President-elect Joe Biden takes office tomorrow, Yellen said the U.S. should be aware of emerging tools for terrorist financing.

"The technologies to accomplish this change over time and we need to make sure that our methods for dealing with these matters, with tech terrorist financing, change along with changing technology, cryptocurrencies are a particular concern," she said in response to a question by Sen. Maggie Hassan (D-N.H.), who called crypto use in terrorist financing a "growing concern."

..."I think many [cryptocurrencies] are used, at least in transactions sense, mainly for illicit financing and I think we really need to examine ways in which we can curtail their use and make sure that anti-money laundering doesn't occur through those channels," Yellen said Tuesday.

Her comment shows a stunning misleading effort about cryptos. The bitcoin network sees 400,000 transactions per day. It is ludicrous to imagine the majority of those are for illegal activities. For law enforcement, actually they can only hope terrorists are stupid enough to use the bitcoin network to fund their operations. Why so? Because bitcoin uses a public blockchain, meaning every transaction is public and can be traced from one crypto wallet to another. The whole world can see how you spend and move your money. Using bitcoin to commit crimes is just about the dumbest thing a criminal could do. 

If you still don't believe it, then let's look at the facts.  Chainalysis, a blockchain analytics firm, estimates 1% of bitcoin transactions are used for illicit purposes. That amounts to about $10 billion. Sounds like a lot, right? But let's compare it to cash. According to a report from Deloitte, as much as 5% of all cash transactions involve money laundering. That's as much as $2 trillion per year. That means illicit transactions in bitcoin are just 0.5% of the $2 trillion. So it begs the question: Why is Janet Yellen focusing on 0.5% of the money laundering problem and ignoring the other 99.5%? Don't tell me Yellen did not know these facts!  Let me tell you why… It's because her banking buddies in the traditional financial system are the ones allowing all of that money laundering to take place. She wants to protect them. But more fundamentally it is because bitcoin can't be controlled and printed willingly by the government bureaucrats. It represents a way out of a dollar-denominated system, and that really scares her.

So in my opinion, Yellen is intentionally misleading the public by defaming bitcoin! Sure, as the country's top financial officer, it will be laughably naive to expect her talking nicely for something that may dethrone the US fiat money. Just like you should not expect to hear a nice word about the newly emerging email back in early 1990s from the head of US postals, how can we expect to hear a nice word from Yellen and her gang now for bitcoin? But I won't be surprised if some day we learn that Yellen and/or her family has accumulated a lot of bitcoins privately while publicly she is strongly denouncing it!! This is the typical hypocrisy for politicians including Yellen!! 

Here is my word to Yellen why bitcoin has such a strong vitality: It is the inflation concern, idiot!

PS:
I have registered as 深山老林 at SafeChat (SC) (You need to download the SafeChat app first) and have set up a new SC chat group. I'm gradually shifting our major social media interactions to SC instead of WC. If you'd like to join my group, sign up a free SC account easily and search for me and connect me as friends.  For friends sharing  similar conservatism views, let's come together to form a better chatting group that won't be constantly disturbed and harassed by the insane radical censorship!