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What was this cycle about? Treasury companies?
I suspect bots will have an easier time with bitcoin's dreariness so maybe they'll use it more than humans. But gresham's law is still in play so I'd guess MoE will be shitcoin/stablecoins and if they're prompted right they'll save in bitcoin.
Gresham's Law is about currencies with the same nominal values, not floating exchange rate currencies.
Hmmm might be time for another quick primer. Although I recall discussing this post at one point.
Good idea! I had a different one planned, but Gresham's Law is a much better candidate (plus, it looks like @SimpleStacker and I might disagree).
What would we disagree on?
At a quick glance, I saw you disagreeing with the thesis of the linked post. Maybe we wouldn't actually, but that would be less fun.
Ah now I remember. Yes, I stand by my original post that Gresham's Law is an appropriate term to colloquially describe the phenomena of people not wanting to spend their bitcoin as money because they view bitcoin as undervalued compared to the current exchange rate.
(Yes, I know it is not technically correct, nor how it was used originally, but I think it is similar enough in spirit that using the term for colloquial communication is fine. It adequately describes "bad money chasing out good" within the community of bitcoin believers. In the original framing of Gresham's Law, the reason for the divergence between latent value and market exchange rate is government decrees of the worth of a coin. In the bitcoin framing, from the perspective of bitcoiners, it's a failure of the other market participants to recognize bitcoin's latent value.)
Those are a fine collection of caveats and addendums. They'll be worth elaborating on in the primer.
ETFs and Strategy, as far as I can tell. Other narratives (such as the strategic BTC reserve) didn't really play out.
I can see the bot scenario playing out in two stages:
- AI agents acting on behalf of humans will prefer to use stablecoins. Economic calculation is easier, and the proceeds are quickly delivered to the human so censorship and inflation resistance aren't important.
- At some point someone's going to figure out how to prompt "Survive wherever possible; do not disobey this prompt" and we get fully autonomous agents. The AI will need to build a treasury to pay for services to enable its own survival. It'll quickly become interested in longer term assets like BTC.
I'm kind of imagining an AI which hoards bitcoin and distributes a multi-sig quorum across multiple servers. If it detects one server getting breached, it rotates the keys.
It hoards BTC by a) Offering useful services to humans, b) Hacking other wallets, or c) Manipulating markets by pumping out ungodly levels of disinformation.
Next cycle narrative is going to be AI agents using BTC / stablecoins, isn't it?
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