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Monthly Archives: March 2017

Bitcoin D Day approaches

Bitcoin is facing it’s own Brexit. Here’s what you need to know.

Similar to US Government, Bitcoin has three branches governing it: Developers (Legislative), Miners (Executive) and Users (Judicial).

Legislative power: The Developers create new code (Laws).

Executive power: Miners run the version of Bitcoin that is in the best interest of Miners. They can work with any party of Developers they choose, even if those Developers are not status quo.

Judicial power: Users choose to buy or sell Bitcoin (affecting supply/demand/price) including any versions created in a hard fork.

This is important because the three branches of Bitcoin are at war right now. A powerful subset of Miners are threatening to force a hard fork of Bitcoin. Think Apple splitting into two companies: Apple and Orange. Which stock would you buy and which stock would you sell? Now you are thinking like a user of Bitcoin.

The arguments between branches are so ridiculous that Vinny Lingham sold 90% of his Bitcoin and is encouraging other Users to defend Bitcoin by selling now to put pressure on Miners. An example of a well known User exercising proactive Judicial power.

If this subset of Miners cause a contentious hard fork it means consensus could not be reached. A contentious hard fork is like a big fat VETO by the Miners. It’s bad for Bitcoin and confuses the market.

If a hard fork happens the Users (Judicial branch) will settle the matter via price discovery (demand being the ultimate arbitrator, like the Supreme Court). I believe the fork of Bitcoin called Bitcoin Unlimited will die off. The cost will be substantial and there will be no winners, only survivors.

Despite the damage, Bitcoin will bounce back quickly. Bitcoin has been declared dead so many times it’s truly an example of “What is dead may never die.”

I am still long.

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Dotcom 2.0: Cryptocurrencies in a bubble

Ethereum, DASH and Monero are the #2, #3 and #4 Cryptocurrencies by market cap behind Bitcoin. They are also in a huge bubble that’s been created the past few weeks. Here are some numbers:

Ethereum: up 178% in 30 days
DASH: up 350% in 30 days
Monero: up 60% in 30 days



When Bitcoin is up the “alt coins” trend down or sideways. When Bitcoin is down, the alt coins trend up. Recent news about the SEC denying the Bitcion ETF, continued contentious debate over a scaling solution for Bitcoin, the Bitcoin Unlimited bug and now Vinny Lingham calling for lower Bitcoin prices have set the alt coin market on fire. Twitter is full of Crypto traders FUDing and FOMOing from coin to coin. If you think trading stocks in they dotcom heyday was crazy try the 24/7 crypto market. Ethereum was up 30% in a 12 hour stretch this week!

This won’t end well for anyone except maybe Bitcoin longs. Bitcoin is antifragile. It’s been through this before. Bitcoin has an ecosystem and most importantly it is used as a store of value and money. The same cannot be said for Ethereum, DASH or Monero.

Very few companies survived massive runs in their market cap during the dotcom bubble. I expect the same of Cryptocurrency. When this alt coin bubble pops, and it will, those bubble profits will make their way back to Bitcoin.

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Bitcoin is back

Bitcoin shrugged off the SEC’s decision to deny the Bitcoin ETF. Bitcoin is now back to prices seen…earlier this month. The absolute horror.

Bitcoin has been declared dead more times than Freddy, Jason and the T800 combined. 125 times in fact.

Here is why the SEC really rejected Bitcoin. A few select quotes:

The SEC doesn’t protect retail investors from anything, least of all bitcoin. It protects big megabanks from prosecution and competition. How can we be sure? Because pump and dump scams are everywhere. A nothing company with zero employees can merge into a shell by technical SEC rules and then start blasting ads to first time investors. This is all perfectly fine. Banks don’t buy into these scams. Retail dumb money does. No protection there.

But Credit Suisse for example can go on and issue double leveraged short term VIX futures shares like the TVIX that are more volatile and explosive than a bucket of antimatter. A bitcoin ETF though would be “too dangerous” for consumers, but the TVIX, the bane of all aggressive novice shorters who dream of making it rich quick, that’s perfectly wonderful, because it’s issued by Credit Suisse.

A bitcoin ETF is way too dangerous, but triple leveraged bear and bull ETFs issued by investment management behemoths with literally trillions of dollars under management, are fine and ubiquitous. Any teenager old enough to open a brokerage account can click a button and buy any of them and the fund decay all goes to the Big Boys. They’re fine because they are backed by Big Money, the same guys who can so easily influence who gets nominated to financial regulatory agencies.

So, good riddance to the SEC.

The biggest threat to Bitcoin is Bitcoin. Bitcoin is software that has a consensus mechanism built in to handle upgrades. To keep it simple, consensus can be reached in a couple of ways and requires majority of miners, users or exchanges to agree on what software version to run. Today a version called Bitcoin Unlimited was attacked via a bug shutting down a majority of miners running the Bitcoin Unlimited version of software.

Why did this happen? Because the selfish fucks at Bitcoin Unlimited want Bitcoin to be Visa over fucking night. They are willing to kill the goose that lays the golden eggs and they shill daily for a hard fork of Bitcoin. They released untested code and got hammered for it. That this happened today is a great thing. Bitcoin Unlimited loses credibility and the case for SegWit, or at least a controlled and well tested fork, is reinforced. Suck it Bitcoin Unlimited.

Gramatik has a song out about Satoshi Nakomoto, the anonymous creator of Bitcoin. “We buying whips with cryptocurrency.”


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UPDATE: ETF denied. Bitcoin dead cat bounced off $1,000. I think we’ll have a final capitulation spike down and then resume upward trajectory for rest of 2017. 4 years in the making and the entire ETF drama will be forgotten by next week.


The SEC decision regarding the Winklevoss Bitcoin ETF is due March 11 (Saturday). Expect an announcement around 430PM EST today.

In anticipation, Bitcoin had a $170 5 min candle today. $170 in FIVE MINUTES. Even for Bitcoin that is ridiculous. $1200 > $1360 > $1190. Bitcoin is a rodeo bull, just try to hang on.


I expect either $2,000 or $1,000 Bitcoin within 7 days. I am leaning that the ETF is denied and we test $1,000. I’m a buyer post announcement either way. If denied, we’ll have a buying opportunity and the entire ETF will just be a blip on the chart by Q2 2017.

However, if the ETF is approved then we’re in uncharted territory. Buy the rocket and hold on.

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