In the End, It was Inevitable — Elon Musk after Adding Bitcoin to his Twitter Profile
It seems like with each passing week, more and more minds are being turned onto the existence of Bitcoin in new ways. People that have been longtime critiques of Bitcoin are now coming around with bombastic enthusiasm. Some countries like India are continuing to flip-flop on cryptocurrencies, while others are putting a foot down as staunch supporters. Finally, it appears that Elon Musk has the ability to manipulate markets from his Twitter account. My favourite part of this week was when Elon and Ray Dalio realized almost in tandem, that Bitcoin eating the world is inevitable.
Ray Dalio; “One Hell of An Invention”
What seems like a complete 180, Ray Dalio has called Bitcoin “One Hell of an Invention”. This comes just two short months after Ray said that he “may have missed something about Bitcoin”. This actually seems to be the trajectory for most people who discover Bitcoin. If I were to classify the stages of Bitcoin adoption on an individual level it would go like this.
Awareness: Generally being aware of Bitcoin’s existence. At this point 75%+ of the world population is aware of Bitcoin.
Dismissal: Outright disregard for the legitimacy and viability of Bitcoin. This stage can last for years, and in some cases, never go away. Some people skip this step, and are naturally intrigued by Bitcoin.
Intrigue: This stage is characterized by general curiosity and self directed research. This stage is typically rapid, and rarely doesn’t lead to experimentation.
Experimentation: At this point individuals decide to dip their toes in the water, and acquire Bitcoin through any variety of channels. Many people never advance beyond this stage.
Adoption: People allocate at least 1% of their portfolio to Bitcoin, and have accepted its basic use case as a store of value, or at least a “good long term investment”.
Infatuation: Most people do not make it to this stage. However, you will know when you meet someone who is here, as they are probably annoyingly obsessed with Bitcoin. Spoiler; This is me.
If you’ve been following the journey of Mrugakshee and I, then you know we published a case study on a company called MicroStrategy. The CEO is Michael Saylor. In 2020, we saw him navigate all 6 stages in a matter of a few short months. You can read about his journey in a case study we published.
Ray Dalio on the other hand is somewhere between intrigue and experimentation. He’s been cited saying he is considering adding Bitcoin to some of his funds that he manages.
The Power of Elon Musk
After adding Bitcoin to his Twitter Profile, Bitcoin jumped by nearly 20%. After tweeting about Dogecoin, it rallied more than 200%. We know Elon Musk has the ability to move rocket ships. Does Elon Musk have the ability to move markets now? Michael Saylor and Elon engaged in a twitter conversation, from one rocket scientist to another. The discussion was on whether or not Tesla should consider allocating some of its own cash reserves to Bitcoin. Now that Elon is seemingly on the Bitcoin train, this is news to look out for in 2021. I’m sure that in hindsight, it will seem inevitable.
How Are Countries Dealing with Bitcoin?
There are other things that piqued my curiosity this week. Have you heard of Craig Wright? He is a man who claims to be Satoshi Nakamoto, the founder of Bitcoin. These claims are largely considered to be false. Nonetheless, it has not stopped him from suing bitcoin.org, for hosting “his” Bitcoin whitepaper. This, in my opinion is staunchly anti-bitcoin. What does this have to do with countries?
Estonia and Columbia Show Bitcoin Support
In response to Craig Wrights lawsuit, many companies, non-profits, and yes, the governments of Estonia and Columbia have put up the Bitcoin white paper on their websites. These governments showing their support for the foundational document is a milestone for acceptance in Bitcoin’s journey. It signifies that Bitcoin will go through various phases of acceptance and rejection around the world. However, there will always be entities as small as community businesses, and as large as countries that support Bitcoin.
India Might Ban Cryptocurrency… Again
India has flip-flopped on their position on cryptocurrency more times than I care to write about. Yet, here I am, reporting that India has proposed a bill banning all “private cryptocurrencies”. What is unclear at this time is whether or not they know the difference between a public cryptocurrency and a private cryptocurrency. For our readers, a private cryptocurrency is one where your identity is 100% hidden, i.e. Monero. Contrary to popular belief, Bitcoin is not private, at all. It is a public cryptocurrency, and pseudo-anonymous, meaning that your identity can be tied the addresses you use on the network. India is banning cryptocurrency in pursuit of its own “Central Bank Digital Currency” (CBDC).
CBDC’s Are Worth Doing Right
Central Bank Digital Currencies are inevitable, and worth doing right. What do I mean by that? A centrally controlled digital currency threatens our rights, and freedoms, but it doesn’t have to. If implemented with privacy, and freedom in mind, they can be a tool for instantly distributing stimulus cheques. They can be used to bypass the Cantillon Effect. They can be used to reduce the carbon footprint of our physical money system. On the flip side, they can be used to shut off the money of anyone who dissents against the current political regime. They can be used to auto-tax, auto-fine, and auto-redistribute wealth. China has already launched the first version of their own CBDC in April of 2020. Canada is in the planning stages and many other world governments will not be far behind. This needs to be a conversation had in the public eye, because one way or another, these things are going to be built, deployed, and forced upon us.
All Roads Lead to Bitcoin
Do we really need a CBDC when we have an international, borderless, censorship resistant, inflation-proof, bias-less, self-sovereign money like Bitcoin? In my estimation, no we don’t. We just need a couple dozen more weeks like we just had. Weeks where centralized entities like RobinHood shut down trades on stocks in order to preserve the bank accounts of billion dollar hedge funds. All this does is run a billion dollar advertising campaign for the best money the world has ever known; Bitcoin. All roads lead to Bitcoin.
All The Best,
Keegan Francis
P.S. I am starting a private newsletter for paying subscribers that will chronicle my research and analysis with real numbers used in real crypto products and services so you can benefit from my real experience.
The first private email will be released this week to all subscribers so you know what I’ll be writing about. Stay tuned for early bird offers.
Thanks Keegan!
1/ Bitcoin has a PR problem. Estonia and Colombia hosting the White Paper is a good step toward changing that. It shows how it is the TECHNOLOGY of Bitcoin that is the revolution. Do you agree or disagree?
2/ It seems obvious that a country like India would want to create their own digital currency and ban decentralized crypto. Once the government passes legislation that gives them undue powers, they don't tend to give it back. What do you think? Too on the nose?