E027: “Altcoins, India and the East”

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BTC Status Update as of 11/12/2016
Bitstamp $702
Okcoin ¥4837
Localbitcoins wkly vol $16.6 million
Network 24hr vol $65.1 million
Difficulty est. +7.93%
Segwit 25.3%
Unlimited 10.9%

Sources: PricesLocalBitcoinsBlockchain VolumeDifficultySegwit v Unlimited


Bits and Pieces

Trending Topics Segwit, Unlimited, bitcoin in India, US Elections, bitcoin vs gold

LISTENER story – Bloomberg article bashing on bitcoin. I think we’ll see fewer “bitcoin is dead” and more “bitcoin sucks compared to xyz”. It’s a subtle but noticable shift of narrative.

LISTENER story – Article from Bitcoin Magazine about more great stuff about Segwit. This is more than a strict capacity increase, which it does, too, but it fixes lots of small things. This article is about the a hardware wallet concern that is fixed. There is a fee attack bug, where you can’t control the inputs and outputs atomically. Segwit fixes it. This one release is an epic human acheivement. Don’t be led astray by promises of high school arguments and hard forks.

Bitcoin is entering mainstream discussions about investing and banking

The first article here is from ForexNewsNow, Central Banks Beginning To Drift Bitcoin’s WayIt’s really interesting that some of the smaller industry news sources are picking up on bitcoin and the possibility of it going mainstream. This article is surpisingly pretty good, and it’s promising that the info here is better than even like CoinTelegraph or other Blockchain News Outlets.

Check out an article penned by bitcoin friend Rosland Capital. They compare bitcoin as an investment to gold and US dollar. They have a cool infographic with colored dots that I go through.

TechCrunch must be listening to the podcast. They use some of the same arguments that I use on a regular basis.

Crazy Markets

Since Dec 31, 2014 >90% of S&P500 Market Cap gains have come from the FANGs (Facebook, Amazon, Netflix, and Google). These companies are quickly becoming systemically important, if they aren’t already. They will be worthy of a bailout in the next crisis. Tweet.

Really good article on Capitalist Exploits, Risk Happens Fast. This is a good case study for the Efficient Market Hypothesis, because it hones in on the crash of the Swiss Franc when they depegged from the Euro. The peg was too expensive to maintain, and getting worse. Many people knew the day was coming when they’d depeg. It flash crashed 30% in 2 minutes. That shouldn’t happen in a world where the peg was efficient.

There was a micro crash in bitcoin following a story this week on Zerohedge where they claimed the Chinese government was looking to restrict bitcoin. My initial reaction was why? I didn’t think this made sense because they have bigger things to worry about. A post on FinTekNeeks supports my thoughts. They do a great job breaking down the fake story, and breaking down why China is not the major player. I believe at least 50% of volume on Chinese exchanges comes from westerner traders.

To wrap up Bits and Pieces I talk about why the polls for the US Elections were so wrong. They weren’t scientific. They were only using the claim to science as a cover for other objectives, namely social engineering. This is a problem I see around in many different industries, all of them controlled by government. Science itself is beholden to the government. Academia has cornered the market in credentials of all fields. If your papers, studies, findings, evidence, or even opinion don’t have the blessing of the gatekeepers to science, it’s wack or no real science. This is a huge problems in medicine, physics, economics, and agriculture to name a few.


Altcoinville

Debrief the Ethereum Scripting Bug

My tweet was quoted in a CoinDesk article. “This is a molehill on the side of a huge mountain of similar issues.” That sums up the situation pretty well. Ethereum is making a distinction between centrally controlled smart contracts (whatever the hell that is) and decentralized contracts. Why do you need ethereum for centrally controlled smart contracts!!!!! Contracts that are what we think, set and forget, are in trouble from this bug. They are making tools for people to check the byte-code of their smart contracts before they set them in the blockchian, but these tools will also have bugs. It’s just getting insane.

The ethereum hash rate was cut in half by since Zcash was launched. This is a weakness that ASICs solves for bitcoin. I noticed also that the mining pools on ethereum have consolidated with three pools having something like 60% of the hashrate.

 

eth-mining-11-12-2016

ethereum price chart

Barry Silbert upped his allocation to ETC. He’s involved himself in the altcoin pump and dumps, which isn’t evil, but that’s not a way to maintain respect in the space, in my opinion. Plus ETC is dead anyway.

etc-11-12-2016

Woobull.com had a great post about altcoins and how bad they are for your portfolio. He charted 118 altcoins that have acheived a market cap of $250k+ and aligned their launch dates. Bitcoin is the standout. The only long term strategy must be to buy and hold BTC. He has a funny canvas representation called “shit runs downhill”. Check out his website.

altcoin-price-history-250k

The end of Altcoinville I spend time analysing the charts of major altcoins. I’ve included them here for you to follow along with. The interesting ones are Litecoin and Monero. Each of those have a slight upward trend over the last 12 – 18 months. I’m not saying that they are long term holds, but there is something more to their story.

dash-11-12-2016

zec-11-12-2016

ltc-11-12-2016

ltc2-11-12-2016

xmr-11-12-2016

 


Featured Article

India Bans 500 and 1000 rupee notes

On the 8th of Nov, after some developments with the battles going on with Pakistan, the PM of India came on national TV and said that they are ceasing acceptance of 500 and 1000 rupee notes. He used the term “black money”. This is an attempt to root out corruption and counterfeit bills from funding terrorism and corruption.

To me it show the hard truth, that fiat paper money is not yours. Even if it’s in your mattress, the government can decide to take it back at any time.

india bitcoin searches


Flash Point

Shifting West to East

Italian Regions going over the head of the EU sending a letter directly to Russia to ask for direct cessation of sanctions between these regions and Russia. What!? This is huge news, how come no one is reporting on this? Sanctions on Russia are going to be short lived. Don’t forget either that Italy has its national referendum on the government structure and powers coming up on Dec 4th. All of this tells me that they don’t want to be in the Euro.

Egypt and Saudi are breaking trade deals as Saudi pulls out of a $23 billion deal to supply oil. Egypt has been cozying up to Russia with arms deals and military actions, which doesn’t make Saudi or the US happy, since Russia is on the side of Assad in Syria. Speaking of Syria, the day after the US elections, the White House announced a major shift in its stance on Syria. They are now targeting al-Nusra which was the recipient of of Saudi, Qatari, and US weapons and money. Now the US is going to be bombing them. Could this be a 180 to enable Obama to claim “victory” as he leaves office? That’s likely. There’s also glimpses of the shifting sands in Jordan where 3 US military consultants were shot on a Jordanian military base where they had been training soldiers (read terrorists).

Everything is shifting East. This could happen quickly now, or continue on its slow tragectory it’s been on. With Trump threatening tariffs and protectionist policies, and isolationism, the shift could be more swift than many expect.


Music by Joakim Karud, Jimmysquare, and Ross Bugden, no copyright/no royalty

Ansel Lindner Written by:

Ansel is a bitcoin specialist, economist, and podcast host.

  • Antonio

    Hi Ansel,

    great podcast and great show notes.

    I am a bitcoin maximalist and agree with you on all the different alt/shit coins. However when it comes to ethereum I think you are off base and missing the point. eth is not a competitor to btc. You should look at it as a poker chip that allows one to play on the ethereum world computer. A world computer on which many experiments in decentralization are occurring some of which may be relevant to bitcoin. These experiments should be supported.
    I don’t believe there is a cap on the number of eth and eth was never touted by Vitalik Buterin as a store of value. And certainly not an investment.

    You are knocking down strawmen when you are attacking eth as an investment. Look at what is going on in ethereum. It is not a copy of bitcoin with a tweak and a new name. Your audience would be better served if you educated yourself. Bitcoin will benefit from ethereum’s successes and also from its failures. Look at it as a testnet for bitcoin. I want ethereum to be successful as a play ground for decentralized applications some of which may be beneficial for bitcoin.

    • Hi Antonio,

      Thanks for the kind words, and thanks for listening. I understand your points on ethereum and have heard them elsewhere. I am hyper-critical (overly-critial?) of the project. I agree that one redeeming quality of ethereum you mentioned is expanding the understanding of bitcoin for the average person, myself included. Every failure is a successful learning experience.