1/n
Revolution, Digital Gold, Ponzi, Scam..
“Bitcoin” – almost everyone has an opinion on it! Bitcoin, along with other coins in Crypto Land, have seen a steep correction in last few days.
Let's use this fall to simplify and de-jargonize the complicated world of Bitcoin.
Thread 🧵
1/n
Bookmark this visual comic form explanation of the whitepaper: https://t.co/6gEHGVV8UM
2/n
For both storing your money and for every transaction involving transfer of value, a financial intermediary or an administrator has been necessary before this. Such as Central Bank for Banking, SEC for securities, etc.
3/n
That isn’t how Satoshi Nakamoto looks :)
Nobody knows how he looks. Nobody knows if such a person even exists. In words, no one knows who owns Bitcoin. This has been fodder for conspiracy theories.
4/n
5/n
Before today's carnage, the total market capitalization of Crypto stood at ~$ 2 Trillion, with Bitcoin contributing c. half of it, although its weight in overall Crypto has been declining.
Check: https://t.co/Ca2PiJbTQR
6/n
As Dalio puts it - "Bitcoin is one hell of an invention. To have invented a new type of money via a system programmed into a computer & being able to scale like that in 10 years!"
This chart via JPM shows the ascent of BTC. Fascinating.
7/n
As per traditional finance, money has 3 purposes. It serves as:
✍️A medium of exchange
✍️A store of value
✍️A unit of account
The utility of BTC & Cryptos has been debated on all 2 parameters.
8/n
While the many critics of Bitcoin have challenged the idea that it can never serve as money, experts now agree on on it's utility as a store of value. The current debate is around medium of exchange due to the volatility.
To its many critics, Bitcoin has always asked back:
Where are we today?
To quote Twitter: "Bitcoin is inevitable":
✅Increasing use cases, leading to DeFi
✅A strong cult (seen the laser eyes?)
✅Early institutional adoption (Mastercard, Visa, PayPal, Tesla, Blackrock etc)
✅Stronger payment ecosystem
But there is a catch:
Of the many debated aspects, the one that is proving to be Bitcoin (and Crypto's) nemesis is energy inefficiency.
"Bitcoin consumes more electricity than Argentina". This headline caught the world's fancy in Feb '21 & it's been a topsy turvy terrain since, leading to this:
As we speak, BTC is down from its peak of ~$64,870 to $40,010 (recovered from intra day low of $30,202). But if one zooms out, it's still a phenomenal rally.
And this not the first correction.
It fell from its peak of $19K in Dec'17
to ~$10K in Feb '18, to ~$3K early 2019.
Let's discuss some lesser talked aspects:
A. Increased retail participation:
Rapid growth in new a/c openings on crypto exchanges. Chart shows unique crypto wallet accounts on https://t.co/5jhnEfoATp. Sharp upticks during FOMO rallies in end 17, mid-2019 & since Nov '20.
B. Increase in balances held in accounts between 1,000 and 10,000 BTCs, likely to be institutionally driven.
Interestingly, balances held in accounts with more
than 10,000 BTCs have declined significantly,
suggesting potential cashing out by early investors and miners.
C. Debate on volatility:
Despite the raging debate, data shows that Bitcoin's volatility has not trended lower over the
past several years. Tt remains about 4 times more volatile than Equities or Gold.
This has been a big impediment in its utility as a medium of exchange.
D. Constraints on liquidity
Lack of legal tender status will constrain
cryptocurrency liquidity compared to traditional portfolio hedges such as Commodities (Gold), Currency, Bonds or real estate.
JPM observes that a "large majority of this liquidity provision comes from high frequency-style traders who often end up fleeing when volatility picks up."
This explains the steep swings (such as now) and are tail risks that should be understood by more crypto enthusiasts.
E. Regulatory risks:
Citi in a report "BITCOIN - At the Tipping Point" opines:
"Despite most ardent wishes, it might prove almost impossible for a government to shut access to BTC or prevent its ownership or usage w/out effectively causing shutdown of the global Internet."
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THE MEANING, SIGNIFICANCE AND HISTORY OF SWASTIK
The Swastik is a geometrical figure and an ancient religious icon. Swastik has been Sanatan Dharma’s symbol of auspiciousness – mangalya since time immemorial.
The name swastika comes from Sanskrit (Devanagari: स्वस्तिक, pronounced: swastik) &denotes “conducive to wellbeing or auspicious”.
The word Swastik has a definite etymological origin in Sanskrit. It is derived from the roots su – meaning “well or auspicious” & as meaning “being”.
"सु अस्ति येन तत स्वस्तिकं"
Swastik is de symbol through which everything auspicios occurs
Scholars believe word’s origin in Vedas,known as Swasti mantra;
"🕉स्वस्ति ना इन्द्रो वृधश्रवाहा
स्वस्ति ना पूषा विश्ववेदाहा
स्वस्तिनास्तरक्ष्यो अरिश्तनेमिही
स्वस्तिनो बृहस्पतिर्दधातु"
It translates to," O famed Indra, redeem us. O Pusha, the beholder of all knowledge, redeem us. Redeem us O Garudji, of limitless speed and O Bruhaspati, redeem us".
SWASTIK’s COSMIC ORIGIN
The Swastika represents the living creation in the whole Cosmos.
Hindu astronomers divide the ecliptic circle of cosmos in 27 divisions called https://t.co/sLeuV1R2eQ this manner a cross forms in 4 directions in the celestial sky. At centre of this cross is Dhruva(Polestar). In a line from Dhruva, the stars known as Saptarishi can be observed.
The Swastik is a geometrical figure and an ancient religious icon. Swastik has been Sanatan Dharma’s symbol of auspiciousness – mangalya since time immemorial.
The name swastika comes from Sanskrit (Devanagari: स्वस्तिक, pronounced: swastik) &denotes “conducive to wellbeing or auspicious”.
The word Swastik has a definite etymological origin in Sanskrit. It is derived from the roots su – meaning “well or auspicious” & as meaning “being”.
"सु अस्ति येन तत स्वस्तिकं"
Swastik is de symbol through which everything auspicios occurs
Scholars believe word’s origin in Vedas,known as Swasti mantra;
"🕉स्वस्ति ना इन्द्रो वृधश्रवाहा
स्वस्ति ना पूषा विश्ववेदाहा
स्वस्तिनास्तरक्ष्यो अरिश्तनेमिही
स्वस्तिनो बृहस्पतिर्दधातु"
It translates to," O famed Indra, redeem us. O Pusha, the beholder of all knowledge, redeem us. Redeem us O Garudji, of limitless speed and O Bruhaspati, redeem us".
SWASTIK’s COSMIC ORIGIN
The Swastika represents the living creation in the whole Cosmos.
Hindu astronomers divide the ecliptic circle of cosmos in 27 divisions called https://t.co/sLeuV1R2eQ this manner a cross forms in 4 directions in the celestial sky. At centre of this cross is Dhruva(Polestar). In a line from Dhruva, the stars known as Saptarishi can be observed.
