Well, somebody has to HODL the bag at the end. Why not the taxpayers?
The “strategic reserve” exposes crypto as the scam it always was
31–40 of 149 posts
Re: The “strategic reserve” exposes crypto as the scam it always was
#32If tax dollars are ever used to buy cryptos, that's simply a transfer of wealth to the crypto sellers, in exchange for nothing in return. This is just another "Tax and Waste" policy. It's just money taken from one group just to give to some other group. It's immoral and illegal, because the gov't is not an investment bank.
Would you agree that the Strategic Oil Reserve has exactly the same qualities?
Short answer: no.
Long answer: no, oil is needed for the functioning of our society. Helping smooth price volatility is useful and valuable. On the other hand, BTC is not needed for our society to function, and so there is little to no value in managing prices of it. This appears to be an attempt to hedge against the collapse in the trust in the dollar.
Re: The “strategic reserve” exposes crypto as the scam it always was
#33Earlier quoted context omitted.
Was curious if a maple reserve existed. looks like Canada is leading the charge on that one: https://ppaq.ca/en/sale-purchase-maple-syrup/worlds-only-res...
Strategic reserves for actual physical commodities makes some sense. Then can reduce the volatility in markets due to sudden unexpected market shocks. In the case of maple syrup that might mean a stretch of really bad harvests. But digital currency is made up. It isn't 'needed' for anything. So there is no sense to have a strategic reserve.
> there is no sense to have a strategic reserve
FX reserves. (Doesn’t apply here. But stockpiling social constructs can still make sense.)
Re: The “strategic reserve” exposes crypto as the scam it always was
#34Earlier quoted context omitted.
Would you agree that the Strategic Oil Reserve has exactly the same qualities?
Short answer: no. Long answer: no, oil is needed for the functioning of our society. Helping smooth price volatility is useful and valuable. On the other hand, BTC is not needed for our society to function, and so there is little to no value in managing prices of it. This appears to be an attempt to hedge against the collapse in the trust in the dollar.
> This appears to be an attempt to hedge against the collapse in the trust in the dollar.
Or maybe an attempt to accelerate a reduction of trust in the dollar? Any cryptocurrency in the strategic reserve is being purchase with dollars, which increases the number of dollars in circulation, and will also be directly inflationary (if it’s newly issued dollars) or increases the US debt (if those dollars are obtained by issuing debt, which classical macroeconomic theory suggests is also inflationary).
Re: The “strategic reserve” exposes crypto as the scam it always was
#35Can anyone who is pro-crypto (particularly: btc, eth) make the steelman argument for why a "strategic reserve" is necessary for these cryptocurrencies? Or even beneficial ? I've been involved in the industry in various ways for years and I fundamentally don't understand why the government owning a lot of btc/eth is advantageous. I understand the "reserve" part, but I don't understand the "strategic." I'm open to the…
The best case is an argument similar to the reason the US gold reserve exists. While the gold no longer directly backs the currency, gold is a neutral asset and wouldn't go to zero during wars/depressions, so could be sold strategically if needed to fund government in a dire situation.
The claim is that BTC is also a neutral asset, meaning it's not linked to any one government or economy, and it has certain properties similar to gold. And that the US should not let China or other countries stockpile this reserve asset first.
It's obviously not "necessary" for any government to function, but the claim is that the reserve properties would be strategically beneficial to weather the worldwide crises in the coming decades.
Re: The “strategic reserve” exposes crypto as the scam it always was
#36While I completely agree crypto is full of shysters and most likely crypto has zero intrinsic value, as well the current administration tries to enrich itself through crypto, I disagree that recent change in prices after announcement proves it is a scam. Because if the government would have announced a strategic reserve in maple syrup, the syrup futures would have increased in price drastically as well.
> crypto has zero intrinsic value So do fiat currencies.
USD is used and is useful for transacting — especially in global markets — because of its high trading volume, stability, limited/no capital flow restrictions, federal reserve’s monetary policy to favor neither exporting or importing (meaning they will not chose to intentionally deflate or inflate the dollar’s value to favor/disfavor certain industries), and also USD’s global acceptance.
On the other hand, people don’t usually transact with BitCoin because of its volatility and because BitCoin’s currency deflation. I’m also almost certain Bitcoin protocols couldn’t keep up with global transactions even if the currency did stabilize. One last point (there are way too many to write them all here) is that there will be no incentive for people to verify blocks when all 21 billion coins are completely mined.
Bitcoin is a game of betting there is a bigger sucker who comes after you. Bitcoin whales realized that the government is the biggest sucker of them all. It’s ironic to me that they have lobbied so hard for the government to subsidize their assets when they have been preaching libertarian idolatry for years.
Re: The “strategic reserve” exposes crypto as the scam it always was
#37While I completely agree crypto is full of shysters and most likely crypto has zero intrinsic value, as well the current administration tries to enrich itself through crypto, I disagree that recent change in prices after announcement proves it is a scam. Because if the government would have announced a strategic reserve in maple syrup, the syrup futures would have increased in price drastically as well.
Intrinsic vale is not a prerequisite for utility. USD has no intrinsic value. Yes, you can pay your taxes with it. That is a contingent value.
The only intrinsic value of crypto is that it can not be unilaterally inflated away, and can be difficult to digitally seize.
In this respect it is similar to gold. It lacks the physical uses of gold, but is easier to transport.
No, I don't think the US government should invest in it. It should make sure it's own currency retains value.
Re: The “strategic reserve” exposes crypto as the scam it always was
#38Can anyone who is pro-crypto (particularly: btc, eth) make the steelman argument for why a "strategic reserve" is necessary for these cryptocurrencies? Or even beneficial ? I've been involved in the industry in various ways for years and I fundamentally don't understand why the government owning a lot of btc/eth is advantageous. I understand the "reserve" part, but I don't understand the "strategic." I'm open to the…
The best case is an argument similar to the reason the US gold reserve exists. While the gold no longer directly backs the currency, gold is a neutral asset and wouldn't go to zero during wars/depressions, so could be sold strategically if needed to fund government in a dire situation. The claim is that BTC is also a neutral asset, meaning it's not linked to any one government or economy, and it has certain propertie…
That's the best argument I've heard, thank you. I disagree with aspects of this argument but it at least makes some sense to me.
Re: The “strategic reserve” exposes crypto as the scam it always was
#39Earlier quoted context omitted.
I can almost guarantee you most everyone who owns BTC will be 100% in favor of anything that will drive up it's price, because they falsely equate it's price as it's value. It has zero value despite it's price, just like beanie babies and Tulips always did.
How are you defining value here?
Everything that hodls it's desirability even after a grid-down scenario.
Re: The “strategic reserve” exposes crypto as the scam it always was
#40Earlier quoted context omitted.
I can almost guarantee you most everyone who owns BTC will be 100% in favor of anything that will drive up it's price, because they falsely equate it's price as it's value. It has zero value despite it's price, just like beanie babies and Tulips always did.
You're wrong — I own BTC and believe in the value of cryptocurrencies, but I am opposed to the US government doing this with my tax dollars.
I'm still correct, because I said "most".