There is now a case being made for Banning Bitcoin while at the same time, you actually have Bitcoin hitting new record highs. Let's talk about that first because we have not seen over thirty thousand dollars per Bitcoin for over a year and we sat at the 28-2 level for a solid three weeks. which was actually pretty impressive because it felt like during the banking crisis the safe haven was Bitcoin which is pretty remarkable because as the banking crisis really took hold, we actually went from a low of about 20 000 when the banking crisis started to about that 28 200 level where we sat between about March 17th and about April 9th. It's pretty damn impressive for Bitcoin.

Now on one hand, there's an argument made that a lot of this is driven by, and after all, we know statistically that over 80 percent of trading volumes for Bitcoin are on Binance, But some folks are making the argument from that Binance is potentially manipulating the Bitcoin Market Conveniently as the occurrences like this happen in the market. Now out, what could potentially have been the Catalyst over the last few days? Well, some people suggest the oil and the dedolarization movements. So in other words, you have one argument that says look, Bitcoin is rallying because obviously you want to escape the dollar, you want to escape the Federal Reserve You want to escape the Cbdcs, and you want to escape sort of government control and oversight And you want that freedom. That's the one argument, right? That, Essentially, while we have a banking crisis and the fringes of the banking sector collapse, which fringes this a pretty generous word to use given that Credit Suisse was a pretty massive bank and pretty integral to uh, the Swiss banking system.

Uh, But then you, You have these fears that Okay, well, well, if OPEC is still controlling oil, and uh, by having a a production kind of of a million barrels a day, they can affect the price of oil so substantially And clearly the reserve currency of the dollar is at risk when that same organization and individual member countries of that organization start considering using or even start are using other countries currencies like the Chinese, Yuan or and minby to start transacting in oil. that's creating this sort of dual pressure potentially for Bitcoin. So you really have three things going for Bitcoin In the banking crisis, you have the D dollarization thanks to walking away from the Petro dollar. But then you also have this third argument that look, maybe we're looking past the recession.

Maybe Bitcoin is the tool that says the recession. If it comes, it's not going to be that bad. The biggest culprit here is inflation, and we're going to go back to money printing once inflation is gone, and we'll go right back to below one percent interest rates, which is pretty much what the IMF said today. We will be going back to one percent interest rates.

Believe them or not, Whatever. Uh, and uh. Potentially Bitcoin is just trying to pre-price in what is to come in the future. Which makes sense because to some extent, markets that trade freely like to pre-price in what could occurred.

So that way you're not last to the party so to speak. And that's why potentially for those three reasons, Bitcoin could be moving up breaking now that 28 to 2 previously resistance level and pretty strong support levels been bobbing around above and beyond that level. Uh, and now we're above 30 000 which potentially sets us up on a course to head back to the next Fibonacci retracement level which would be 35 900. But at the same time as this is all uh, coming to a head now there's talk about potentially Banning BTC now, or just by any crypto entirely now.

I Generally don't love talking about this because people usually get mad at me when when we talk about this. but I'd like to see what the argument is that people are making for for Banning uh BTC And this is a foreign affairs piece which I generally uh, I generally respect Foreign Affairs But let's let's see what argument they make here. Uh, it's also worth noting that some folks on these sort of anti-crypto side do make the argument that hey, if Binance controls 80 of a market flows because of people using Binance. Uh, is that necessarily a bad thing? It just means they had commission free trading for Bitcoin Maybe that's why they have 80 of the flows because they were smart.

Well, according to analysis by Morgan Stanley which a lot of folks in the crypto Community don't believe as far as they can throw them anyway. but Morgan Stanley believes that the biggest Traders during the banking crisis were actually whales. that is likely brokerage accounts, not individual retail. Traders So if it was whales driving crypto pricing or Bitcoin pricing then perhaps there is some convenient manipulation happening, especially since Binance did liquidate Usdc reserves they had in favor of buying Bitcoin Now that ends up looking like a really good decision because they got a great deal right and the value of that BTC has gone up, which is fantastic, but it does make you scratch your head on how much risk is this company taking and that is something that people are very fearful of right now in markets because, well, ultimately, the more risk and exchange takes, the more of this chance you have of creating potentially another FTX which nobody wants to hear about.

For example, FTX made headlines yesterday for their nonsensical arguments that they basically would. They had such loose accounting practices that they would sometimes just happen to accidentally just find 50 billion dollars. you're sorry, 50 million dollars sitting around in an account somewhere and have absolutely no idea what that 50 million dollars was for. That was an example of Binance for or FTX for you.

Now, hopefully Binance, as is substantially different, uh from FTX. But we don't know because we don't have uh audits. we don't have proof of reserves our audits anymore, Those have been canned and we do not have uh, any kind of audits that give us insight into how much debt this company actually has. Those are both very important.

So what is the potential argument that Foreign Affairs is making and what is the case for Banning As they say Crypto? Well, let's jump into exactly that piece. Uh, I Do think I want to be very clear? Okay, I want to disclaim this away that even though we're going to look at this piece, it's okay. if you like Bitcoin it's okay to look at what another argument is and they do actually make some interesting arguments. Uh, that, uh that again with the true or not uh or valid or not or worth considering.

So let's take a look at this. Here is uh, the piece and we're going to go through this together. I Am going to throw up the banner for the coupon codes. Uh, because that coupon code does expire tomorrow for the programs on building your wealth linked down below.

So what could the case for Banning Crypto actually be? Well, let's find out. So they start their article by talking about FTX which isn't that entertaining? Oh, come on there we go. They start their article by talking about FTX but take a look at this. but FTX is unraveling was not an isolated incidence the incident they say Rather, it revealed a fundamental flaw in cryptocurrency.

My goodness, What! What is going on with this computer today? There we go. It revealed a fundamental flaw in cryptocurrency in the cryptocurrency industry. The root of the problem is that cryptocurrency assets can be created at no cost and without limit. and an unlimited supply of assets makes the system more vulnerable to booms and busts now.

I Thought that was a really interesting argument because I'm thinking about it I Think what they're saying And this was sort of. My initial thought when I was hearing this is I Think what they're saying is if you have crypto institutions like let's say a binance that says hey, look, we will lend against whatever crypto collateral you have, then you essentially create a fractional Reserve banking system, much like the traditional banking system, right? The difference though, is rather than a country being able to create a currency, anybody in their mom can create their own currency, which if it has some deemed market value, which could be based on a very thin order book and with very horrible fundamentals. If a company starts lending against that, whether it's in the defy space or or the more centralized space like a finance well, then you essentially can create this flywheel of infinite money. And this is how you can actually prop up the boom and bus Cycles substantially more when assets have nothing behind them and no reliable Financial Accounting practices or valuation techniques.

Because you can't value them based on income, you can't, you can value them based on use, right? And that's generally what people do with Bitcoin or Ethereum is we look at what's what's the value of of the use, the utility, and what's the value of uh of of uh demand compared to supply which is difficult to measure because sure, that takes you right back to well, how much is a Bitcoin being used for transactions? But generally you're not using Bitcoin terribly much for transactions I Venture to say that most people are using it for a store of wealth, unless of course, you're sending money, uh, overseas, and then in which case, you're probably using stable coins anyway. So, but this is very interesting. The root of the problem is that cryptocurrency assets can be created at no cost without limit. When assets have nothing behind them and no reliable Financial Accounting practices or valuation techniques exist to expose fraudulent manipulation of assets, the results is where the result is: Fraudsters have rushed into cryptocurrency, exploiting the complexity and hype as a way to dupe basically the normies to dupe the people who are completely clueless about how a cryptocurrency can actually be manipulated and this this is frequently seen uh, obviously in the historical artifacts of what happened with FTX but also, uh, when we look at hey, where why are we no longer even doing proof of reserves Mr Binance uh Mr CeCe Oh, not doing proof of reserves anymore because you don't want to.

Okay, got it. And uh, you got dumped by the auditing firm because they think the reports aren't being trusted by people anymore as they really shouldn't And then when CZ provides uh, uh, proof of of, uh backing, uh, we tend to get very overlapping wallets which does on one hand make people who are super pro buying and super pro CZ say oh my gosh, he's a God He posts all his transparency. but when you actually go, but when you actually go to the transparency, these wallet chains are like wait a minute. We're double counting some money and we can't follow through with all of the transactions that are actually occurring because there are things purposely left out.

and there's so many wallets that these exchanges have the as transparent as crypto is. And as simple as it is to make the argument that old crypto is transparency or is transparent, it's actually extremely difficult to follow along with most crypto transactions unless you have a complete map of every single wallet uh, that an entity has and it's very difficult. This is why they're actually analytic firms. Uh, designed to try to stitch this all together because it is so complicated it's not.

It's almost not meant to be understood by a normal person. It's pretty wild. But anyway, cryptocurrency concerns. Cryptocurrency already facilitates many different kinds of harm, and this is a pretty like Janet Yellen style argument right here.

Iran and North Korea use cryptocurrency uh, and the inanimous to evade sanctions and launder money See, this gives you sort of. The other example, it's like, hey, it's so transparent that criminal entities or estate sponsors of terrorism can use them to basically skirt sanctions. Hey, we need to go buy stuff from Turkey because we can't buy it from Russia anymore. Here's crypto payment.

Go turn it into, you know, a stable coin or whatever afterwards if you want. which they do In 2022, for example, reported reportedly stole 1.7 billion dollars in cryptocurrency. which it it which it is believed to be using to fund ballistic missiles and nuclear weapon development. So look at that.

Here's here's an example: a report by Foreign Affairs suggesting that North Korea sold 1.7 billion dollars in crypto and now they're using it to develop their nuclear weapons program. It's intense. That's a pretty big allegation. Bitcoin has become the most common form of payment for ransomware attacks, increasingly targeting businesses and public services because it allows the nefarious actors Behind these attacks to receive large amounts of money quickly and anonymously.

Cryptocurrencies are also increasingly being used to facilitate drug and human traff trafficking, and basically without knowing who's using these wallets. Uh, the crypto chains are relatively Anonymous if allowed to proceed unchecked. The unrestricted growth of the cryptocurrency industry and its future integration with the traditional Financial system could produce a major crisis. Blockchain-based Finance is complex, automated, and highly interconnected.

It offers vast opportunities for creating leverage because there's virtually Unlimited Supply of assets to borrow against. This is what I talked about earlier with: If you, if anybody in their mom can create a currency and an institution will lend against it, you do create essentially infinite money. These are kind of the kind of fragilities that led to the last financial crisis in 2008. This damaged trust in the traditional Financial system.

Uh, and the cryptocurrency industry wandered into the wreckage, promoting itself as a reliable alternative to bank. So basically, in 2008, when we had infinite money in the traditional system, people stopped trusting the traditional Financial system so much that it essentially created crypto. and now crypto is potentially following in the same footsteps. There's the danger that members of the cryptocurrency communities embittered by their losses may also be funneled into extreme online communities.

I Think this is a little bit more of an extreme example here. Basically, people are gonna turn into a loose canon Maniacs Because they lost money in crypto. Industry leaders and lobbyists tend to argue that the primary benefit of crypto is decentralization. Unfortunately, that is unrealistic.

The economic incentives of crypto have led to extremely concentrated pools of transaction validators, leaving users develop uh, dependent on those small groups of people. I Mean that's true when you look at the controls. For example of uh, Ethereum, you're looking at Lido being a massive player. uh, in the space.

And now with Ethereum 2.0 Uh, we. The idea is we have more centralization, but still staking pools. What they really do is centralize control into into a fewer groups. Now, many argue.

Well, that's not necessarily a bad thing because people are going to the most reliable validators. the ones who have the lowest incentive to actually do something wrong long were nefarious, because then they would lose all of the incentives and payments that that pool would otherwise be able to generate, and they'd essentially be shooting themselves in the foot. So there's some counter arguments to this: I Think Really, the best argument they make is this infinite money argument I Think that's great. Otherwise, so far the arguments here are some of the pretty traditional anti-crypto arguments.

uh, misleading rhetoric about crypto's decentralization is being used to persuade Regulators that software is calling the shots applying their no business entities or humans to regulate. But the reality is that regulation can be applied to many different intermediaries they're basically now they're talking directly to Congress saying, look, you know companies like Binance are going to tell you it's all robots and algorithms that are controlling this, But the reality is, there are plenty of people behind the curtain uh, that, uh that that make movement decisions CZ is a perfect example. and who knows, they could end up being the The and maybe they will be the Survivor in the cycle. Uh, you know.

I I Hope they survive because if they don't survive, it's just going to hurt more of the financial ecosystem. I Personally am just a big fan of not your keys. Now out your crypto and I Think it. It makes all of this a lot simpler.

Get your money off exchange, right? But if policy makers are reluctant to adopt an outright ban, then the second best alternative is to stringently enforce regulations that are already in place. Banking: Regulators should use existing Prudential rules to keep Banks from being exposed to the risks of crypto now. I Don't think anybody argues that some regulation would be nice and Crypto I Mean when you look at coinbase, they're basically begging for regulation. They're basically saying hey, please give us regulation, tell us what the rules are so we can play by them as opposed to the game we have today, which is we're going to try to do our best and then we're just going to keep getting sued by the SEC and commodities future trading Commission Because nobody's actually telling us what the rules are and now you're trying to litigate your way to actual Authority which is the inappropriate way to do it.

Congress should actually bestow upon you rules to enforce, which then you are dutied or basically, uh uh, you know, designated to enforce and then those rules could actually be followed or not followed and then duked out in court rather than. oh, we don't have any laws, Let's turn. Let's deputize the SEC and the Commodities Future Trading Commission and turn them into cops where they make their own rules. and then they find out if those rules are accurate or not in court like it's It's super backwards right now.

How crypto is being regulated? Super Super backwards. Uh, and that's a big problem. And it's not to say there's not also a big problem with potentially some of what's going on at Binance potentially and potentially this infinite money glitch that you could have with crypto. Uh, I think those are realistic problems, but I do think regulation can help, especially with that infinite money glitch.

And then that's exactly why companies like Coinbase vet their coins before they allow them on platform to lend against anyway. Uh, now to what extent that vetting is, nobody really knows, because again, no regulation. Greater concern is the development of an offshore currency industry. See, this is the other issue is is when you don't regulate properly here, what you're basically just doing is you're pushing people more out of the United States And so Foreign Affairs makes a very good argument here.

At the end, they said the United States should continue to take part in the efforts to limit Uh crypto at a global level level by actually regulating right. And so maybe maybe it's not so bad if we can actually get some good regulation in that would prevent some of the problems with it. Big fan of that. So I'm not a big fan of banning crypto, but I'm a big fan of actually getting to the point where we have some regulation I think that would be fantastic I Also think through a Bitcoin often is is a good leading indicator of potentially what's to come in the stock market.

which in the short term I think is actually fantastic that we've just broken through that 28.2 level. and I think we're on that path to 35.9 Uh, you know am I am I knocking on the door of looking at a million dollars for BTC in the future? Who knows. I mean if BTC runs to 100 150k over the next one to two years, that could be enough of of sort of starting the flywheel to get people going. Oh my gosh, this is the greatest thing ever.

Uh now will that potentially lead to a 2008 like Foreign Affairs projects uh could end up happening? Who knows. Maybe maybe it won't be this cycle that we get crypto regulation. Maybe maybe it'll be the next boom cycle and then the bus cycle that actually leads to appropriate crypto regulation? Who knows. But we'll see.

Uh, so that gives us a little bit of insight into what's going on with BTC Make sure to check out those programs I'm building your wealth link Down Below on the expiring coupon code which ends tomorrow.