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👁️ Scan Your Balls Dystopia, 🇷🇺 Russia Bans Digital Assets, 📈 BTC Block Height Reaches 800K

👁️ Scan Your Balls Dystopia, 🇷🇺 Russia Bans Digital Assets, 📈 BTC Block Height Reaches 800K

Naiw
July 26, 2023 • Estimated Reading Time: 15 minutes

Greetings Earthling,

Welcome to Issue #22 of the Bitcoin Breakdown, where we chart humanity's course towards hyperbitcoinization.

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Happy reading! 👽️

📰 HEADLINES

Worldcoin, the eyeball-scanning, dystopian global ID system from the same guy that brought you ChatGPT, has launched, merely underscoring why Bitcoin is so crucial. The project promises a cryptographically secured 'proof-of-personhood' by introducing proprietary hardware reminiscent of the palantir Saruman used to speak with Sauron. They call this the 'Orb' – a silver sphere roughly the size of a bowling ball – that performs iris scans to confirm a user's humanity. Even Vitalik Buterin has commented that the project might be excessively centralized. Critics have also noted that the team was unprepared for people selling their credentials, which undermines the entire purpose of the project. Meanwhile, blockchain security firm PeckShield has detected that a fraudulent Worldcoin token has already executed a rug pull.

Russian President Vladimir Putin has banned digital assets as a form of payment while granting legal tender status to the so-called 'digital ruble'. A portion of an existing federal legislation concerning banks and banking activities has been suspended by the bill Putin signed, which now prohibits people from using cryptocurrencies as a payment method. The bill also introduces a digital version of the ruble, effectively greenlighting the implementation of a Central Bank Digital Currency (CBDC) in Russia. Russians will apparently not be forced to use the digital ruble; it will serve as an 'additional option' alongside traditional fiat currency. The CBDC is designed for payments and transfers, not as an investment vehicle. [There’s no better time to buy BTC to hedge yourself against the supposed good intentions of your bureaucratic overlords, pleb friends.]

Bitcoin’s block height reached 800,000 on Sunday. You are now roughly 275 days away from the halving event that will occur at block height 840,000. The block subsidy will then decrease from 6.25 BTC to 3.125 BTC. There will be 19 more difficulty adjustments between now and then, with the next one occurring this week, decreasing difficulty by approximately 3.8%.

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🏆 TOP STORIES

The Simple 3-Step Formula That Supercharges Your Orange-Pilling Game (July 22 | 6 min read)

SV, the Editor-in-Chief of BitcoinMaxiNews.com and a former professional advertising copywriter, has written a follow-up article to his piece, 'Orange-Pilling Secrets from an Ad Copywriter.' He advises instilling a sense of urgency and emphasizes the need to present Bitcoin as an irresistible offer that addresses major world issues and has a vast potential market. He also provides a 3-step orange-pilling formula: open with a compelling question about Bitcoin's potential, offer irrefutable proof to substantiate claims, and present a link to a resource that enriches their understanding, like his classic free 25-minute Bitcoin MasterClass. The aim is to spark curiosity and FOMO in people, nudging them to explore Bitcoin independently and potentially becoming fervent adopters. The article underscores that this approach is more effective than simply disseminating traditional educational information about Bitcoin's features.

The Single Most Important Truth About Bitcoin Mining, Energy and the Environment (July 25 | 10 min read)

Troy Cross, a professor at Reed College and a fellow at the Bitcoin Policy Institute, has written in response to Greenpeace's recent hit piece. He posits that proof-of-work mining will help decarbonize the grid and lower the cost of energy production. As the issuance rate of new bitcoin decreases over time, miners will inevitably seek the most economical energy sources, thus driving prices down. This trend is expected to lead to the utilization of otherwise wasted or excess energy, such as flared methane or intermittent renewable energy. Consequently, bitcoin mining will prove beneficial for both energy economics and emissions reduction. Bitcoin mining's inherent drive towards cost-efficient energy will prevail in the long run, despite any ill-informed or agenda-driven calls to move away from proof-of-work as a consensus mechanism.

Can On-Chain Metrics Determine which Cryptocurrencies are Securities? (July 25 | 35 min read)

Coin Metrics released a report that presents a methodology to translate the existing legal language of securities frameworks into objective, measurable criteria derived from blockchain data. For instance, they analyze the token balances of teams and foundations in a sample of crypto projects, comparing them to their total issued supply, in an attempt to gauge the 'common enterprise' prong of the Howey Test. The report emphasizes that while on-chain metrics may provide valuable insights, they are not a definitive tool for classifying assets as securities. The SEC's enforcement actions and framework do not suggest a single 'smoking gun' metric. Instead, a comprehensive legal analysis is necessary, with data likely serving merely as one piece of the puzzle.

The Stock-to-Flow Model is still Right (July 18 | 8 minute read)

Jesse Myers, Bitcoin Maxi and COO of Onramp Bitcoin, explains why the Stock-to-Flow (S2F) Model, a Bitcoin price forecasting tool popular during the 2020-21 Bitcoin bull market, may still hold validity, despite falling out of favor. He argues that the model's unfulfilled promise of astronomical price targets contributed to its downfall. The predicted prices should have instead been presented as a probabilistic range. However, the core concept of storing value in Bitcoin due to its increasing scarcity remains valid. The model's underperformance could be attributed to macroeconomic challenges and the growing inertia in Bitcoin's valuation. Despite its shortcomings, the S2F model can still serve as a useful guide with some necessary adjustments.

Bitcoin’s Martin Luthers: How Ordinal Wizards Challenge The Religion Of Maximalism (July 21 | 7 min read)

Nathan Cryder, the COO of a renewable energy company and founder of a Bitcoin-focused holding company, delves into the parallels between Bitcoin and religious traditions. He spotlights various Bitcoin holidays that commemorate notable events in Bitcoin's history, drawing similarities with religious observances. Cryder also addresses the passionate enthusiasm of many Bitcoin maximalists, likening their behavior to religious evangelists. While he agrees with certain economic principles and acknowledges the potential of Bitcoin as sound money, he criticizes the maximalists' propensity for engaging in conspiratorial rhetoric and imposing litmus tests on other Bitcoin enthusiasts. Cryder further explores the internal cultural conflicts within the Bitcoin community, particularly those surrounding the emergence of ordinal NFTs and their impact on the network's core function, comparing its proponents to religious heretics in the same vein as Martin Luther.

Rebuttal of Greenpeace Report on Bitcoin Mining Claims (July 17 | 17 min read)

Daniel Batten, co-founder of CH4 Capital and Bitcoin ESG analyst, has also penned an insightful rebuttal, refuting in detail Greenpeace's latest hit piece. Batten argues that the Greenpeace report recycles many widely-debunked claims about Bitcoin, relies on unsubstantiated fears about 'what might happen' rather than concrete evidence to sway readers, and consistently omits important contextual information, thereby presenting a distorted and often false appraisal of Bitcoin. Batten demonstrates that Bitcoin is a force for environmental healing, not harm, and provides growing evidence suggesting that Bitcoin mining is helping expand the renewable grid. His article serves as a valuable counterpoint to share with environmentally conscious individuals who have encountered negative environmental messaging around Bitcoin and are keen to seek context before forming their own viewpoint.

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📖 GUIDES & EXPLAINERS

What Is Bitcoin Legal Tender? (July 25 | 5 min read)

Che Kohler discusses in an article for The Bitcoin Manual the potential of Bitcoin as legal tender in various countries. For Bitcoin to become legal tender, a government would need to pass a law recognizing it as a valid form of payment in that country. The advantages of Bitcoin as legal tender include its decentralized nature, ease of international transfers, and exemption from capital gains tax. However, there are also disadvantages, such as its volatility, lack of widespread education, and potential for lost funds. Developing countries with cash-based economies and volatile local currencies would be prime candidates for adopting Bitcoin as a more inclusive and accessible payment method. The growing user base and increasing liquidity of Bitcoin suggest that it will become more mainstream in the payment landscape.

Hodl Hodl Review 2023: P2P Bitcoin Exchange That’s Fun & Easy (July 26 | 11 min read)

Athena Alpha has reviewed Hodl Hodl, a peer-to-peer centralized exchange notable for its extensive payment methods. The exchange garners praise for its security, privacy, and low fees, positioning it as a solid option, particularly for beginners. The platform does not mandate any KYC and provides a private wallet for users. Although it lacks end-to-end encryption for some user data, it employs HTTPS for secure transmission. Hodl Hodl's website boasts an easy-to-use interface and supports a wide range of countries and payment methods. Additionally, the exchange offers a peer-to-peer lending service. Despite lacking mobile/desktop support and not being open-source, it remains a popular choice for users prioritizing high levels of privacy and security. Plans are underway to integrate the Lightning Network in the near future.