Is Bitcoin dirty?

This month Bank of America Global Research issued a 49-page report on Bitcoin titled “Bitcoin’s Dirty Little Secrets” that comes across as a hit piece.

It has five main sections:

  1. What drives Bitcoin prices? 12 pages
  2. How does Bitcoin compare to traditional portfolio assets? 9 pages
  3. How does Bitcoin score on ESG? 11 pages
  4. Are CBDCs Kryptonite for crypto? 6 pages
  5. Is DeFi potentially more disruptive than Bitcoin? 7 pages

Right on page 1, the executive summary, the plan of attack is laid out clearly (italics mine):

“Bitcoin supply is artificially scarce, demand drives prices”

No good…


An Adoption S-Curve for a New Monetary Technology

This is not investment advice. Bitcoin is highly volatile. Past performance of back-tested models is no assurance of future performance. Only invest what you can afford to lose. You must decide how much of your investment capital you are willing to risk with Bitcoin. No warranties are expressed or implied.

Figure 1: Technology adoption curves for some major inventions. Bitcoin is 12 years old and has 11% adoption in the US.

Technology S-Curves

It is well known that technology adoption approximates an S-Curve or logistic function. It took half a century for electricity to be widely adopted in the US, a quarter of a century for half the population to get TVs, but mobile phone adoption took only half that time.

Bitcoin is…


Has Dark Matter been converted to X-rays in Neutron Star magnetic fields?

Many people have heard of neutrinos (little ‘neutral ones’). They are produced in abundance in the Sun, come in three flavors (electron, muon, and tau) and have no charge, and very small masses. The upper limit of the combined masses of the three flavors is 0.12 eV.

There is a hypothesized particle known as the sterile neutrino that is a candidate for dark matter, but these would be heavier, extremely so, probably much more than a proton mass.

But there is another dark matter candidate, never observed in…


Check out our new platform 🚀 https://thecapital.io/

$10 Billion is New High for Crypto Mining Revenue

We have just released the Fifth biannual CryptoSuper list of Top 50 mining pools. As of the end of October, when we took a snapshot of the top 6 coins and top 50 pools, the crypto mining production annual run rate had reached a new high of over $9 billion. In the past two and a half weeks, the Bitcoin price has continued to rise significantly. If we were to adjust to today’s Bitcoin price, the gross annual revenue run-rate for the top 6 mined coins would exceed $10 billion.

Bitcoin…


There are only two Monetary SoVs Today: Gold and Bitcoin

Check out our new platform 🚀 https://thecapital.io/

This is not investment advice. Bitcoin is highly volatile. Past performance of back-tested models is no assurance of future performance. Only invest what you can afford to lose. You must decide how much of your investment capital you are willing to risk with Bitcoin. No warranties are expressed or implied.

Wealth of a Certain Type

Money is a universal intermediate good used as a form of wealth. People use it as the connector between other goods and services, and as a way to resolve debts. The first well-documented money was accounted for in Babylonian temples in the form of barley. …


Two to three kilograms by end of the decade?

Check out our new platform: https://thecapital.io/

This is not investment advice. Bitcoin is highly volatile. Past performance of back-tested models is no assurance of future performance. Only invest what you can afford to lose. You must decide how much of your investment capital you are willing to risk with Bitcoin. No warranties are expressed or implied.

Bitcoin as Digital Gold

Bitcoin is often referred to as a sort of digital gold. It is a monetary asset, but unlike gold, it is not mined and minted into physical coins or bars. Instead, it is mined by supercomputing farms of specialized cryptographic solver rigs, and imprinted onto a permanent ledger, the time…


By Stephen Perrenod on The Capital

This is not investment advice. Bitcoin is highly volatile. Past performance of back-tested models is no assurance of future performance. Only invest what you can afford to lose. You must decide how much of your investment capital you are willing to risk with Bitcoin. No warranties are expressed or implied.

Look for Positive Skew: Taleb

In his “Bleed or Blowup” article for the Journal of Behavioral Finance, Nicholas Nassim Taleb notes that many investors seem to prefer repeated small positive payouts but thereby assume the risk of large negative drawdowns or blowups. One should seek positive convexity, positive skew instead, to maximize long-term returns. …


By Stephen Perrenod on The Capital

“Antifragility is beyond resilience or robustness. The resilient resists shocks and stays the same; the antifragile gets better.” — Nassim Nicholas Taleb

Bitcoin Improves as it Faces Uncertainty

This article is inspired by Nassim Nicholas Taleb’s Antifragile: Things that Gain from Disorder. The term that he created, Antifragile, means beyond resiliency, beyond robustness. It conveys something that improves in response to shocks and errors, as happens in the evolution of living organisms with errors and mutations. The most adaptable survive and prosper. This also happens for humans individually when they exercise; moderate stresses on the body confer benefits overall. …


Bitcoin is on a Block calendar

Witness at crums.io: 0515d51a66480ff94b4bb274e1214e5419c3181af7d970b39ee66f096b7022ce

“The portion of the integral calculus, which properly belongs to any portion of the differential calculus, increases its power a hundred-fold” — Augustus De Morgan

(This is not investment advice. Bitcoin is highly volatile, as demonstrated below.)

Abstract

In a previous article, I introduced the Future Supply model, using quarterly data (https://link.medium.com/bvWOCqrXr6 ) spanning nine and a half Block years of data on quarterly intervals. For this article I have refined the analysis by using a full ten Block years of data on Block monthly intervals (of 4375 blocks each). …


By Stephen Perrenod on The Capital

This is not investment advice. Bitcoin and other cryptocurrencies are a new and highly volatile asset class. Consult your investment advisor; do your own due diligence.

To Mine or to just Buy and HODL?

I recently took a look at a long-term Bitcoin mining contract based on state of the art hardware, with all costs including electricity and systems management bundled. Fortunately, I have been tracking the top mining pools and difficulty and hashrate trends over the past few years, as well as energy consumption in the industry. I also have some personal experience in purchasing cloud mining contracts.

A prior article covers the production of the largest…

Stephen Perrenod

supercomputing expert, astrophysicist, cryptocurrency analyst, orionx.net, author of DarkMatter, DarkEnergy, DarkGravity

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