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- 🛟 When will the music stop? 🎶 📉
🛟 When will the music stop? 🎶 📉
When the music stops, debt spirals always end the same way – with rampant inflation as leaders try to prop up the system with more money printing.
Dave Birnbaum & David Waugh
June 01, 2023
Bitcoiners,
After months of uncertainty, politicians in Washington have come to an agreement regarding raising the debt ceiling. Congress must approve Speaker McCarthy and President Biden's proposal by June 5th, or the Treasury will default on its obligations.
The deal leaves much of the Biden administration's key policies intact and does not represent a significant cut to government spending. There is a $69 billion cut next year and $112 billion in 2025, but no budget caps or automatic cuts afterward.
Politicians and pundits might claim to have saved the day with this deal. They have more accurately just kicked the can down the road. Rising costs for healthcare, social security, and "non-discretionary" budget items will continue to increase deficits alongside interest payments on the current debt.
When the music stops, debt spirals always end the same way – with rampant inflation as leaders try to prop up the system with more money printing. Currency collapse is the final result.
The fiscal and monetary reckoning ahead does not bode well for those holding government currencies – but bitcoin, untethered from the regime, will keep ticking on, a neutral option for anyone that wants to exit politicized money.
With that, let's dive into the news.
NEWS
America is bullish on gold
Each year, Gallup polls Americans on what they think is the best long-term investment — bonds, real estate, savings accounts/CDs, stocks/mutual funds, or gold. Last year real estate and stocks claimed the top spots, respectively. This year, however, the number of Americans who think gold is best has nearly doubled, rising from 15% in 2022 to 26% today, overtaking stocks.
What's causing the shift?
Bitcoin is notably absent from the poll, and it is reasonable to expect it would have performed well if included. Yet, gold's rise highlights the "flight to safety" mentality emerging as Americans recognize the risk in assets tied to the dollar system.
El Salvador’s new bitcoin advisor
Dr. Saifedean Ammous, a renowned economist, Coinbits advisor, and author of "The Bitcoin Standard," will become an Economic Advisor to El Salvador's Bitcoin Office following the country's historic adoption of bitcoin as legal tender. He joins Max and Stacy Keiser, who already advise President Bukele.
Known for his expertise in bitcoin and monetary economics, Ammous will offer guidance as the nation continues integrating bitcoin into its economy.
El Salvador's signal
President Bukele could not have selected a better advisor. El Salvador is quickly attracting international interest for its commitment to bitcoin and economic liberty. Companies are taking note, and some bitcoin firms are relocating from the United States to the Central American nation.
One Trillion Dollars in Credit Card Debt
Credit card debt has risen significantly over the past year. The total amount of credit card debt Americans hold has surpassed $1 trillion, setting a new record, with the typical household carrying $10,000 of the burden.
What happened?
During the COVID-19 pandemic, stimulus and easing work conditions allowed Americans to accumulate savings. Yet, during the past year, fewer employment opportunities and persistent inflation have evaporated household wealth.
TWITTER SPACES
Don't miss our talk with @tatumturnup tomorrow as we dive into his experiences interviewing top bitcoiners and entrepreneurs, his bitcoin journey, and other topics.
BITCOIN ADOPTION CONTINUES
Wolf, a bitcoin startup accelerator, debuted its first cohort of bitcoin-driven startups.
The Digital Asset Mining Energy (DAME) tax, which would have imposed up to a 30% excess tax on bitcoin miners, was nixed during debt-ceiling negotiations, providing relief to the American mining industry.
Tether, the issuer of the world's most widely used stablecoin, announced it would begin bitcoin mining operations in Uruguay.
Sabre56, a bitcoin mining hosting provider and consultancy, has brokered a substantial deal to host 4,510 BTC miners owned by institutional-grade bitcoin mining company GEM Mining in its new Wyoming facilities.
Cuba Bitcoin hosted the country's first-ever bitcoin meetup, with over 60 people in attendance.
HOW BITCOIN WORKS
Learn one key idea about bitcoin each week. This week: Bitcoin is proliferating.
Alternative cryptocurrency advocates and traditional finance talking heads sometimes often assert that no innovation is occurring in the bitcoin ecosystem.
Motivations aside, their claim is worth evaluating.
Has bitcoin "stalled out?" In a sense, it has. Bitcoin's base layer hasn’t changed significantly every few months, like that of other networks. It’s important to understand, however, that this is by design — it’s a feature, not a bug.
A secure base layer gives investors confidence in bitcoin as a long-term investment.
Entrepreneurs can build layer two solutions, sidechains, hardware, and other software projects on top of the base layer, knowing that network outages or a confusing roadmap won't plague it.
Bitcoin's solid, unchanging foundations has allowed for proliferating ecosystem growth rather than stagnation. Startups are building diverse applications and systems on bitcoin for national and international customers.
The bitcoin dominance ratio, or the market capitalization of bitcoin relative to the combined market cap of all other cryptocurrencies, remains steady — staying in the range of 40% to 48% in the past six months.
Institutional demand is also increasing. Bitcoin-only companies River Financial and Unchained Capital recently raised $35 and $60 million in funding rounds, respectively.
Even traditional finance firms like JP Morgan have come around. JPM analysts recently compared bitcoin to gold, commenting on its properties as a secure store of value.
Globally, bitcoin usage continues as more individuals use it to transact and store wealth outside inflationary fiat currency systems.
Bitcoin's proliferation is happening. As more investors allocate capital to the ecosystem and more entrepreneurs and firms build applications on top of bitcoin's base layer, a snowball effect takes hold, accelerating growth ever faster.
Are you ready to get started with bitcoin? Coinbits is the best option. It's quick, safe, and free to create your account. Sign up now.
COIN CHECK
Which country has the highest estimated total of bitcoin hash rate?
China
The United States
Russia
Kazakhstan
Check your answer at the end of the page.
FROM THE MEME POOL
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Answer: 2. The United States. Currently, the United States has the highest country level hash rate.