Updated: Mar 15, 2022
TimTom moments are fun times. It’s when Alvarism subscribers get to cash-in on their knowledge - both materially and emotionally. It’s when the haughty, arrogant, unthinking detractors of Alvarism’s reports get their comeuppance, as they face the consequences of ignoring our disclosures. As Tim The Enchanter from Monty Python would affirm: life is short but schadenfreude is grand since it’s the beginning of the humbling of people who need to be humbled.
Enter Joe Biden’s new executive order, ringing the death knell for the Wild-West cryptocurrency market. Well partner, tighten your knickers and stand up from your poker game at the local saloon, because “the law” is coming to town. Biden’s directive on cryptocurrency seeks to:
Protect U.S. Consumers, Investors, and Businesses
Protect U.S. and Global Financial Stability and Mitigate Systemic Risk
Mitigate the Illicit Finance and National Security Risks Posed by the Illicit Use of Digital Assets
Promote U.S. Leadership in Technology and Economic Competitiveness to Reinforce U.S. Leadership in the Global Financial System
Promote Equitable Access to Safe and Affordable Financial Services
Support Technological Advances and Ensure Responsible Development and Use of Digital Assets
Explore a U.S. Central Bank Digital Currency (CBDC)
This justifies my assessment in 2017 to both crypto-slinging professors and students alike. To recap from our previous article, the practical utilities of cryptocurrency superior to the dollar:
Black market exchange of drugs and illicit goods and services
Evasion of international sanctions
Avoiding central bank financial repression, in part
Transaction costs are often less expensive and always faster than check, credit card, ACH, and wire transfer
The cost of holding cryptocurrency, inflation, is typically lower than the historical inflation of the US money supply
The practical utilities of the dollar superior to cryptocurrency include:
Loss, fraud, theft, and counterfeit protection
Universal status as legal tender for payment
Established systems of tracking and reporting yield economic data that is critical to governments, investors, and businesses
A government has guns backing its legal tender, and an interest in its stability. A stroke of the pen can stifle cryptocurrency transactions in one moment, at a much higher risk than legal tender.
Unlike many cryptos, a mandatory deflationary ceiling is not built in. Remember, while runaway inflation is bad, so are extreme deflationary events.
Of course these utilities are from the perspective of a person who would choose to use one currency over another. To law-abiding citizens, making crimes easier is not beneficial.
If you synthesize my list with Joe Biden’s executive order, you will see the crypto demand curve will be crushed, as those who flooded the speculative bubble with capital were motivated by the practical utilities over the dollar. Only item number six in the first list above will remain unscathed by the financial directive, particularly if a Central Bank Digital Currency that is pegged to the US dollar is deployed successfully.
So yeehaw, partner! Presuming that you card sharps and speelers traded your scuds for some crypto sawdust while mocking we skin-flints? I hope you got a little bit lucky. If you didn’t get swindled by the skin game of the dozens of crypto flops like DAO, Dogegoin, or PayCoin, maybe you played your cards fortunately with Bitcoin:
If you bought Bitcoin in 2017 when I stoically warned audiences: caveat emptor? I hope you didn’t get frustrated by your sustained 50% loss from $18,000 to $9,000 for 30 months, and jumped ship before the COVID dirigiste tsunami of productivity-destruction and currency debasement.
If you were a true believer, and held on to your bleeding investment for more than 30 months? Well congratulations! A Chinese national socialist lab leak that killed millions of people across the globe was the black swan that global dirigistes exploited to siphon consumer-graded value into their preferred economic activities. And of course, as with any massive inflationary event, defensive stores-of-value reap the benefits. So did you go from $18,000 to $60,000? A 300% return in 54 months? Nice! But did you know to jump ship during those two months of opportunity out of 54 months? Well if not, you’re still holding a 200% position, so congrats on that as well.
After this announcement from Biden, and as the directives are implemented, you might not be sitting so pretty. In the very least, Alvarism thinks it’s prudent to inform you of the directive so that you can gamble according to your own optimally-informed proclivities. Caveat emptor. As you can see, my staunch insistence that crypto was a speculative bubble in summer 2017 was validated by 30 months of proof.
But, if you want to rely upon unpredictable black swan events like COVID to grow your portfolio? Hope them slumguzzling crypto dealers don’t smoutch ye too much. I love the Wild West, in historical documentaries and entertaining movies. But over here in real life, I prefer to invest in productive enterprise, like Alvarism, MYnstrel, knowledge, and hard work. Not only does it always pay off in the long run, it does great things for people along the way, and doesn’t turn gains into a resource curse, like Russian/Saudi petrostates, slavers, trust fund children, and government welfare grifters.
There’s no better way to corrupt humanity with incentives for foolish activities and entitlement, than impersonal, redistributed, or usurped consumption of something-for-nothing. Crypto may have a future in a controlled manifestation, but it seems as if the high-falutin’ days are coming to an end, save perhaps one more potential black swan on the horizon. How lucky are you in games of chicken?