In Praise of Bitcoin
April 28, 2021·62 comments
Bitcoin entered mainstream institutions and immediately lost its meaning. Everyone on the call agreed Bitcoin had no real value. Academics, think tank economists, and the Federal Reserve's finest gathered to discuss use cases—payment transfers, financial innovation, novel applications—but nobody mentioned what actually got them on the phone at 8 pm on a Thursday: Bitcoin trading at $50,000. The real question hung unspoken: Is there anything behind that price, or is it pure speculation?
• The identity that made Bitcoin interesting disappeared. Autonomy, resistance to institutional control, entrepreneurialism—these were replaced by something else almost without anyone noticing it happen.
• Wall Street didn't ban Bitcoin or fight it directly. Instead, they absorbed it. They created abstracted versions, securitized representations, derivative products that promise Bitcoin's price movement without Bitcoin's actual properties or complications.
• The US Treasury simultaneously painted Bitcoin in bureaucratic orange. New regulations extending Anti-Money Laundering and Know Your Client rules to cryptocurrency mean every Bitcoin transaction touching the financial system becomes visible and traceable to government surveillance infrastructure.
• Self-hosted wallets and peer-to-peer transactions remain technically outside this panopticon, but only for now. Treasury documents signal that even hidden wallets present unacceptable "risks" that require eventual elimination, even if blockchain transactions are already publicly visible.
• Two parallel forces accomplished what neither could achieve alone. Wall Street neutered Bitcoin's revolutionary potential while Treasury ensured visibility. The thing that attracted millions—a symbol of resistance—is being methodically extracted, leaving only the trading symbol behind.
The Why of Epsilon Theory
- Make more informed decisions as an investor and citizen.
- See through the nudges of Big Politics and Big Media.
- Become a better consumer of news.
- Maintain your autonomy of mind in a swarm of narratives.
- Join a community of more than 100,000 truth-seekers.
Unlock instant access to this and hundreds of other evergreen essays that explore the world of narrative through hard science and human wisdom.
Looking for Deeper Insights?
Unlock exclusive market intelligence, trade ideas, and member-only events tailored for investment professionals and active investors with Perscient Pro.
VISIT PRO
DISCLOSURES
This commentary is being provided to you as general information only and should not be taken as investment advice. The opinions expressed in these materials represent the personal views of the author(s). It is not investment research or a research recommendation, as it does not constitute substantive research or analysis. Any action that you take as a result of information contained in this document is ultimately your responsibility. Epsilon Theory will not accept liability for any loss or damage, including without limitation to any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Consult your investment advisor before making any investment decisions. It must be noted, that no one can accurately predict the future of the market with certainty or guarantee future investment performance. Past performance is not a guarantee of future results.
Statements in this communication are forward-looking statements. The forward-looking statements and other views expressed herein are as of the date of this publication. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and there is no guarantee that any predictions will come to pass. The views expressed herein are subject to change at any time, due to numerous market and other factors. Epsilon Theory disclaims any obligation to update publicly or revise any forward-looking statements or views expressed herein. This information is neither an offer to sell nor a solicitation of any offer to buy any securities. This commentary has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Epsilon Theory recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a financial advisor. The appropriateness of a particular investment or strategy will depend on an investor's individual circumstances and objectives.
