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BITCOIN BOX SCORE

Exchange Rate: $100,021
Market Capitalization: $1.97T
Hash Rate (90 days): 706/8 EH/s
Transactions (30 days): 15,209,951
Network Fees (economy): 2 sat/vB
Bitcoin Dominance: 56.37%

What do these numbers mean?

The momentum around bitcoin continued to surge this week, from Texas statehouses to Wall Street and Washington.

Texas legislators proposed accepting taxes and fees in bitcoin, potentially holding its bitcoin revenue as a strategic reserve. It’s yet another move signaling that government entities are taking bitcoin seriously.

Meanwhile, MicroStrategy’s anticipated inclusion in the Nasdaq 100 later this month might drive billions of dollars into spot bitcoin and bitcoin ETF products, because it would mean that investors who want to simply invest in large baskets of stocks and funds will indirectly buy bitcoin, often without even realizing it. It’s further evidence that bitcoin is becoming tightly intertwined with capital markets.

President-elect Trump’s vow to bolster U.S. leadership in bitcoin, paired with the possible appointment of pro-bitcoin regulator Brian Quintenz at the CFTC, suggests America’s bitcoin policy will unleash unprecedented financial innovation in the coming years.

Beyond these headline moves, the broader environment is also providing bitcoin with tailwinds. As inflation metrics remain noisy and fiscal policy is constrained by massive debt, the value of the Bitcoin Network becomes difficult to ignore.

Institutions, governments, and everyday savers are recognizing a simple truth: Bitcoin’s combination of scarcity, decentralization, and portability offers an unmatched opportunity to safeguard against the consequences of over a century of fiat-driven economies.

NEWS

🚨 House Report: Government leveraged Bank Secrecy Act to monitor Americans’ finances

A new interim report from the House Judiciary Committee and its Select Subcommittee on the Weaponization of the Federal Government reveals that federal law enforcement, under the Biden-Harris Administration, quietly gained unprecedented access to Americans’ private financial data.

The report details how the FBI, treating financial institutions as extensions of law enforcement, requested Suspicious Activity Reports (SARs) on Americans without due process or clear justification.

In the aftermath of January 6, 2021, this approach intensified as FinCEN encouraged banks to file SARs on hundreds of Americans.

Money Laundering is Financial Thoughtcrime

Expanding surveillance capabilities threaten to make virtually all financial activities visible to political institutions. As digital ID and AI innovation accelerate, Americans risk losing control over who can access and interpret their financial data – an unsettling prospect for privacy and freedom.

The good news is that a reckoning is increasingly likely. The Bank Secrecy Act is now being discussed openly as the scourge that it is.

It’s been a long time coming. It’s hard to believe that the classic article in American Banker, Money Laundering Is Financial Thoughtcrime, was published over 10 years ago.

Hopefully, the incoming administration will keep this issue in sharp focus as part of its agenda to restore economic and personal liberty.

Argentina and El Salvador sign bitcoin agreement

Argentinian and Salvadorian regulators agreed to collaborate on shaping bitcoin-focused policies in Latin America. The move comes as El Salvador, which designated bitcoin as legal tender in 2021, aims to share its regulatory expertise and foster a more welcoming environment for bitcoin innovation across borders.

Under the deal, the two countries will exchange knowledge and best practices, potentially paving the way for more streamlined regulations and greater adoption.

Given Argentina’s openness to innovation and President Javier Milei’s favorable stance toward bitcoin, this partnership signals an important step in strengthening the region’s position in the global economy.

Google’s new quantum chip spurs debate on bitcoin security

Google’s unveiling of its Willow quantum processor, capable of certain tasks in a fraction of the time traditional supercomputers need, has renewed concerns about whether quantum technology might crack bitcoin’s encryption one day.

While experts say the chip’s 105 qubits are far too few to threaten bitcoin now – millions of qubits would be needed – its advancements have brought the issue into sharper focus.

Industry observers note that such a threat remains decades away, and bitcoin developers are already exploring quantum-resistant protocols to secure the world’s largest and most robust digital currency.

Meanwhile, if quantum computers could crack bitcoin’s encryption, they could also crack the encryption used by secure communications, interbank transfers, credit card payments, military intelligence, medical records, and everything else for which we have an expectation of data privacy and integrity. In fact, it would be far easier to update the bitcoin protocol to a quantum resistant algorithm than to transition the sum total of all other private data, at once, to hardened encryption.

Treasury Secretary Janet Yellen apologizes for increasing debt by $15 trillion during tenure

Outgoing Treasury Secretary Janet Yellen has voiced remorse for not doing more to rein in America's runaway debt levels after overseeing a historic $15.2 trillion increase under her Federal Reserve and Treasury leadership.

Despite her apology, critics argue Yellen's policies – keeping rates low for years and enabling massive government spending – helped fuel this record borrowing, eroding the nation's fiscal sustainability.

As the U.S. faces ballooning interest expenses and unprecedented deficits, her decisions (in part) combined to push the country closer to a looming debt crisis.

If only a monetary system existed that bureaucrats couldn't exploit to run up endless debt at everyone else's expense…

BITCOIN ADOPTION CONTINUES

Bitcoin lending platform Lava raises $10 million in Series A funding from Founders Fund and Khosla Ventures.

Famed investor Ray Dalio, worried about unsustainable global debt, now favors "hard money" like bitcoin over bonds as stable hedges against economic uncertainty and currency debasement.

Sygnum predicts that "demand shocks" from institutional investors in 2025 will drive bitcoin's fiat exchange rate higher.

Strike announces Bill Pay, a new feature that allows users to pay bills directly from their Strike account with bitcoin or cash.

Eric Trump calls bitcoin the ultimate real estate hedge, praising its liquidity, portability, and ability to democratize global wealth-building opportunities.

HOW BITCOIN WORKS

Learn one key idea about bitcoin each week. This week:

Volatility versus risk: understanding the difference

Most people equate volatility with risk, assuming that if an asset’s price fluctuates sharply, it must be dangerous. But volatility and risk aren’t the same.

Volatility measures how much and how quickly prices change. Risk, on the other hand, is about the probability of a permanent loss or the erosion of an asset’s long-term value.

Consider bitcoin. Its exchange rate moves frequently, causing many to label it “risky.” Yet what truly defines risk? Compare bitcoin’s fixed, transparent supply with that of the U.S. dollar, which can be manipulated at will by political elites.

Over time, consistent monetary expansion erodes the dollar’s purchasing power, creating a subtle but real form of risk — your savings simply buy less year after year. To avoid this, you’re told that you must “invest,” thereby taking on a new, unpredictable set of risks associated with whatever you choose to invest in.

In contrast, bitcoin’s volatility is a result of observing it at a unique period in its history – a time when it is being discovered and adopted by millions of people, and becoming money (economists call this “monetizing”). As it undergoes price discovery, it is likely that its volatility will dampen, eventually stabilizing.

Policymakers and global institutions often blur the distinction between risk and volatility. By trying to suppress volatility at all costs – through currency interventions, rigid regulations, or “stabilizing” mandates – they cultivate an environment where the underlying risks do not surface clearly.

This can give the illusion of safety but mask deeper vulnerabilities. In a world where we strangely accept that interest rates are manipulated and monetary policy decided by a tiny cabal of unelected technocrats, what looks stable may be anything but.

Volatility, when well understood, can provide opportunities for long-term investors. It’s not the enemy – but misunderstanding it can cost you. Bitcoin’s swift price swings signify nothing more than a market finding its footing. Over time, this volatility may diminish, leaving behind an asset whose risk – unlike that of endlessly printable currencies – is not hidden behind the illusion of stability.

On The Bitcoin Standard Podcast, our own Dave Birnbaum talks about how Coinbits.app is using bitcoin to build an innovative operating system for money. Listen now: Spotify | YouTube | Apple | Fountain

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COIN CHECK

What is the maximum number of bitcoins that will ever exist?

1. 10 million

2. 21 million

3. 42 million

4. 100 million

Check your answer at the end of the page.

FROM THE MEME POOL

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ANSWER

2. 21 million.

The decision to cap bitcoin's supply at 21 million was a deliberate choice by Satoshi Nakamoto, though the exact reasoning remains somewhat speculative. Nakamoto described it as an "educated guess" aimed at aligning its pricing with existing currencies while ensuring scalability for a global system.

The 21 million limit emerged from specific design decisions, including a 10-minute block time, an initial 50 BTC block reward, and a halving schedule every 210,000 blocks (approximately every four years).

These parameters, when combined, result in a total supply that converges to 21 million units. This cap serves multiple purposes: it creates scarcity, potentially increasing demand and value over time; it provides a predictable inflation rate; and it aligns with the goal of replacing traditional currencies, as 21 million was roughly 1/1000th of the global money supply when bitcoin was created.

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