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BITCOIN BOX SCORE

Exchange Rate: $63.810
Market Capitalization: $1.26T
Hash Rate (90 days): 620.9 EH/s
Transactions (30 days): 19,247.417
Network Fees (economy): 3 sat/vB
Bitcoin Dominance: 58.61%

What do these numbers mean?

Yesterday, the Federal Reserve cut its target federal funds rate by 50 basis points (bps), from 5.5 percent to 5 percent. After months of waiting, the "Fed pivot," where it initiates a sequence of rate cuts, is upon us. Expect more cuts before the year is out.

This raises a key question: Why begin now? Fed chair Jerome Powell maintained that the cut was not due to worsening economic data. However, it is hard to believe him, given that 50 bps cuts typically occur before a recession and never happen when the economy is doing well. Although the tweet below is not quite accurate, since it leaves out the emergency COVID rate cut, it is still insightful.

If we’re being honest with ourselves, the Fed likely began cutting rates to juice the economy before the election in order to favor the incumbent. The quaint idea that lifelong bureaucrats who vote and donate overwhelmingly to one party are “non-partisan public servants” ran its course long ago.

But Powell’s plan could backfire. Such a large rate cut signals to the market that the economy is in poor shape – which may cause investors to seek safe haven assets and cash rather than chasing growth opportunities.

Still, no matter how you slice it, both presidential candidates (and every other global leader besides Argentine President Javier Milei and Salvadorian President Nayib Bukele) are committed to continue spending money. This means governments worldwide will continue to debase their currencies and suck value away from savers, further diminishing confidence in fiat money.

How long the charade can continue is anyone's guess – but bitcoin makes it so that people have a choice as to whether they stay fully inside the system. The all-binding power of fiat, which means “by decree,” is gone forever

NEWS

📈 Companies adopt “bitcoin per share” metric

MicroStrategy is pioneering a new metric in equities analysis: sats per share, which could change how public companies are valued. In recently released financials, the firm reported a 17% increase in bitcoin per share compared to the end of 2023. This metric, sats per share, reflects the company's ability to increase its bitcoin holdings.

Reshaping global finance

Bitcoin is taking on a more significant role across financial markets.

Roxom, a new firm that raised $4.3m in a seed round this July, is building a stock, commodities, and futures exchange that is priced and denominated in bitcoin.

Cathedra, a bitcoin miner, released a memo detailing its strategy and focus on maximizing shareholders' per-share bitcoin holdings, explicitly orienting the company to boost the sats per share metric. The memo is worth reading in its entirety:

🍔 First U.S. President makes bitcoin purchase

In New York City, former President Donald Trump stopped by Pubkey, perhaps the most well-known bitcoin-themed restaurant and bar in the world. While there, he purchased a burger using bitcoin. The historic moment appeared in photographs across mainstream media outlets. Zaprite cofounder Will Cole breaks down the mechanics of the purchase here:

🎓 Business school renamed following bitcoin donation

The father of the Winklevoss twin donated $4 million worth of bitcoin to Grove City College, resulting in the college's business school being renamed the Winklevoss School of Business. About the gift, Tyler Winklevoss stated that his father:

"…first discovered the principle of sound money when he studied at Grove City College in the 1960's and was heavily influenced by the Austrian school of economics that was being taught there. This school of thought also clearly influenced Satoshi."

As bitcoin continues to proliferate and shape society, schools that teach sound economic principles and theory stand to reap significant rewards.

🤯 President Bukele announces deficit-free budget

El Salvador's President Nayib Bukele announced the country's 2025 budget will be deficit-free, without reliance on the IMF or any other multilateral authority, which often leverage lending to impose restrictions on vulnerable nations.

The country's bitcoin holdings currently stand at over $330 million, with an unrealized gain of over 30%. El Salvador's bonds soared on the news, indicating investor confidence in the nation and Bukele’s stewardship of the Salvadorian economy.

Can you imagine another Western nation proposing a deficit-free budget?

The announcement was made on El Salvador's independence day, with Bukele delivering an inspiring speech. Here is the entire clip:

BITCOIN ADOPTION CONTINUES

BlackRock released a report titled "Bitcoin: A Unique Diversifier" detailing bitcoin's ability to protect investors from risks in traditional financial markets.

CleanSpark is acquiring seven mining sites in Tennessee, boosting its hashrate by 22% with plans to reach 37 EH/s by the end of 2024.

Germany's Commerzbank and DZ Bank are launching bitcoin trading services, expanding mainstream access amid growing institutional demand.

Louisiana accepts its first bitcoin payment for state services using the Lightning Network.

River, a U.S. bitcoin exchange, launched a Proof of Reserves tool, verifying over $800 million in fully reserved bitcoin holdings.

HOW BITCOIN WORKS

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

What is hard money?

This week, crypto and finance expert Arthur Hayes stated,

But if I think about the taxonomy of how I look at crypto, Bitcoin is money. No other crypto is money. It's the hardest money that we've created in human history. Bitcoin cares about the security of the network. Bitcoin cares about an immutable blockchain. Ethereum is not money, regardless of what people say.

They decided not to be money in 2016 when the community allowed a hard fork to happen to pay back the DAO hack folks.

What does it mean to be a hard money? As defined by Saifedean Ammous in The Bitcoin Standard, hard money refers to money that maintains its value over time due to its difficulty in increasing the supply.

The concept revolves around the ratio of stock (existing supply) to flow (new production). Hard money has a high stock-to-flow ratio, meaning it is difficult to produce new units, which prevents devaluation through inflation.

Historically, gold has been the, well, gold-standard of hard money due to its scarcity and the challenging process of extracting more gold from the earth. The limited annual increase in gold's supply – under 2% – ensures that it holds its value well over time.

Bitcoin is an even better form of hard money, which is why Hayes claims it is the hardest ever created in human history. Its supply is mathematically capped at 21 million coins. Its issuance rate is predictable and decreases over time, reinforcing its resistance to inflation.

And, unlike fiat currencies, where new units can be created at will by central authorities, bitcoin’s stock to flow ratio is mathematically guaranteed to increase over time. Fiat does just the opposite – over an extended duration, the number of units marches on toward infinity.

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

When and where was the first bitcoin conference?

1. 2013, in San Francisco

2. 2010, in New York

3. 2008, in Tokyo

4. 2011, in New York

Check your answer at the end of the page.

FROM THE MEME POOL

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ANSWER

4. 2011, New York.

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