Bitcoin Forum

I believe they must be doing it in secret. What would be the advantage for North Korea, or Iran, to let everyone know that they are accumulating/mining/HODLING?

I think some countries' government are accumulating crypto and maybe discreet about it since crypto is not yet massively adapted. Maybe those country who believes in technology, innovation and sees the potential of crypto as an alternative medium of exchange.

I don't know if governments would want something like Bitcoin to be accumulated by them. Imagine a centralized entity using a decentralized currency. There are a couple of things that governments would not like about bitcoin.

• The Trust that it has value.
  • Imagine FIAT currency, they have value because the government says they have value
  • They want it to be backed with tangible assets
• They want control over the currency (which is not possible for Bitcoin)
• They can't control the maximum supply
• Crime Concerns (with all the media and news surrounding it, I don't know if they will trust it)

I think there are more to be discussed, but that's just came from the top of my head. I believe they have other concerns rather than this one. Unless the Leader of that country believes in the currency, that would be a different story all over.

There could be accumulating in order to manipulate markets and make easy money - Kim's minions may do that easily.
Or there can be the typical accumulation - and here you've forgot about China which tries to buy anything available.
Or, they can use it for trades behind curtains, to avoid various international bans.

This may be happening already for years, just we are too small fishes to find out. But if it happens, it's OK: it's one more proof for "the infidels" that Bitcoin works.

And for the ones that will come and tell it's not OK: if you ban one currency, another one will take its place. The "good guys" have to do better in stopping the trade, history has shown that the attempts to control the money flow have failed.

but why?
every conspiracy theory in my opinion should not just talk about what ifs but why. otherwise there is no end to crazy things you can come up with!
i personally can't see any incentive for the governments to accumulate bitcoin.
if it is for  control, there are a lot of different ways they could control bitcoin (eg banning its usage) or its market (by injecting fiat that they print in it),...
if it is for money, similarly there are other better ways of making money. governments don't concern themselves with this type of profit!

Literally governments may not have more benefits if they accumulate cryptos and let the fiat to depreciate but they might be doing it for the good future of their people so they are showing that they are different from the developed countries in the world when it comes to supporting their citizen?

I think for me some countries are really accepting and accumulating bitcoin and maybe others are not. Everyone knows that bitcoin are plenty of benifits and other uses really worth it.

While I'm definitely not saying that this is the case, but one possibility(though I kinda slightly doubt it) is that some countries thinks bitcoin actually has a decent chance of being successful in a wider scale. If bitcoin actually becomes a reserve currency in the future, then hey. Grabbing a good amount of bitcoins probably wouldn't hurt and it would definitely put them in a great position. But then again, this is just speculation. I doubt the government has an appetite for speculative assets.

I doubt any such thing is happening!! North Korea is ruled under a dictatorship so can't tell for sure! But for the other governments, it seems impossible! Countries believe in a centralized economy and bitcoin or any other cryptos are directly against that centralized value! So they would not "waste" their "valuable" fiat against something that directly contradicts with their own belief!

For N. KOREA, it may be possible because they simply don't bother about the rest of the world!

Ever thought of a 'How' ?

How would the government be accumulating bitcoins ?

While they can simply buy lots of bitcoins and hold it, it would create a suspicion since the price would surge.
There is another way of accumulating while not creating any suspicion and that is by acquiring the bitcoins caught in theft and scams.
Almost every country would have registered cases where people have lost bitcoins and other cryptocurrencies.
While most of them would obviously have not yet been solved, there are many who have been caught and the cops seized a shit ton of bitcoins from them.
Just google 'cops seized bitcoin' and the results will speak out for itself.

Where do you think all those bitcoins are going ?

Nations, States and Government are dynamic entities and they changes over time. So, I don't think any of them would accumulate bitcoin as such. If they do, they'd do in privately.
We have seen rich Chinese and Russians buying bitcoin to hide their wealth from the state. Large political leaders in Venezuela and North Korea buying bitcoins for a secure future.
And it could be similar in everywhere else.

or even provide some evidence. as you say, there is an endless amount of possibilities we can speculate about. arguably, it's usually not productive to do so




It would only be a conspiracy if it were illegal to buy Bitcoin in that country. there aren't many countries where owning or buying Bitcoin is against the law, and the government is unlikely to prosecute themselves anyway


hence, states buying BTC is not and never will be a conspiracy

please learn what "conspiracy" actually means, basically

The same as with gold reserves, but without the incurred costs of custody and storage, or transport...

As long as they learned how to properly make and handle cold wallets its the smart move to do for long term preserving of value.

Naturally. When huge investors try to enter a market, they do it slowly and quietly. They don't announce their presence. It only makes sense to disclose their position after they're done buying. Until then it's only rational to stay quiet, or maybe even engage in FUD campaigns to keep prices down.

The US and Bulgaria both had a chance to own a huge chunk of the total supply. They auctioned off the bitcoins instead. In the future, this will be the best way for governments to accumulate -- seize them from alleged criminals. And stop auctioning them off...

maybe not today since bitcoin is still so new and unproven.

but think about the big picture. what's gonna happen if reserve currencies start collapsing? let's say the USA government defaults on its debt and the entire world starts unwinding their USD exposure. chances are this would create liquidity crises in multiple major economies. we could see the collapse of several major fiat currencies in succession.

smart governments are hedging against this eventuality by accumulating gold. in a global currency reset, chances are we will return to the pre-fiat systems of asset-backed money, so gold will be an obvious hedge. but theoretically this relationship should extend to other assets, especially for capital liquidity purposes---the global economy can't just be restricted to the gold supply. in a decade or three (which is a realistic time frame for a USA default) bitcoin could definitely be one of those assets.

I bet some countries are experimenting on how best to use these cryptos to circumvent detection on their illicit transactions.
Take the case of Iran,  they are under heavy economic sanctions by the U.N. and I think they could find it attractive to use
crypto to channel their funds to make different transactions thereby minimizing the effects of these sanctions.

Maybe, the governments are accumulating Bitcoins in order to study it. In order to prevent bad things that might happen. We all know Bitcoin is semi-anonymous. The government will use Bitcoin in order to detect those criminals that use Bitcoin. I mean, not just in North Korea but in the other country as well.

But I believe that some politicians are accumulating Bitcoin for the reason of profit.

A government accumulating Bitcoin is against what we're looking for: decentralization. It might still be decentralized as a currency, but if a government holds a huge percentage of coins then they control the majority of those in circulation.

I actually see there is a big chance this government accumulation is already happening. There are only a few (4 or 5 IIRC) countries that made BTC tax-exempt. BTC and precious metals should be tax exempt without any doubt, but here we are... living on a close to $200.000.000.000.000 world debt. That's what BTC is for, and that's why they don't like BTC: they can't cheat.

Accumulating BTC to study the cryptocurrency? How does that even make sense?

Bad actions and criminals will never be prevented. They'll always find a way and no matter what currency they have to work with, they'll do it. If a man has an evil mindset, you can't stop it. BTC is used for crimes less than fiat, trust me.

The government can freely trace people's transactions without holding a single satoshi though. Because you know, Bitcoin has an open and public blockchain that can be inspected by literally anyone that has a computer and internet. Unless of course, that they're conducting dust attacks[1].

---

[1] https://medium.com/chainrift-research/bitcoins-attack-vectors-dust-attacks-9040edee2986

That to me is a far-fetched idea. Why would the governments buy something that [1.] they might know a little or nothing about, [2.] does not have any guarantee of appreciation over time, [3.] could not be influenced by them or even invited for possible negotiation/arrangement, [4.] might be a direct threat to the very system they are operating and benefiting under, [5.] and most importantly, cannot be made a secret? 

To a rogue and eccentric country such as North Korea though, it could possibly happen.

if bitcoin could help these countries go around the sanctions and help with their transactions then it would have made some sense to me but since it can't (being small and too volatile) i don't think it is plausible. besides if accumulation were the goal of the governments then they could have simply impose new tax laws on anybody who owns bitcoin to pay a portion of it to the revenue services, that way in no time without any cost they would accumulate a lot of bitcoins no matter what the price of it is at that time.

To go around economic sanctions imposed to some countries, for example the United States' sanctions on Iran, North Korea, China, or Venezuela.


But censorship-resistance is Bitcoin's value proposition, it can be a powerful tool for a country/nation/government.

It is not a secret that some countries are using "alternative" payment options to bypass economic sanctions.

https://news.bitcoin.com/venezuelan-government-accused-of-using-bitcoin-to-bypass-us-sanctions/

https://www.fxstreet.com/cryptocurrencies/news/cubans-resort-to-bitcoin-and-cryptocurrencies-to-bypass-us-sanctions-201909130421

https://www.fxstreet.com/cryptocurrencies/news/russian-arms-producer-to-use-bitcoin-to-bypass-sanctions-201907291503

https://www.haaretz.com/middle-east-news/iran/bitcoin-craze-hits-iran-as-u-s-sanctions-squeeze-weak-economy-1.7579740

Why is this illegal, these countries are doing this to survive and their citizens are suffering more as a result of these sanctions.  ::)

If countries like North Korea and Iran really do such thing,they would keep it secret,because once the western world finds out,you can kiss legal cryptocurrency trading and mining goodbye. ;D
I don't think that North Korea and Iran(or any other third world country ruled by a dictator) ca manipulate the crypto markets.They just don't have enough money to gather huge amounts of coins.

Why? The volatility as risk, in exchange for going around sanctions, is worth taking in my opinion. Plus what does "being small" mean? The capped supply?


How many people own Bitcoin, and how much do they own? How can the government prove, and will the people declare it?

Better to tax people in fiat, and use that to subsidize Bitcoin buying/mining.

Does it matter? They will only be strengthening the Bitcoin ecosystem with ways you mentioned.

Gold is decentralized -- yet central banks are storing it in their vaults as we speak. How is that any different? :)


The limited amount of accessible liquidity in the system. Anyone who needs to buy or sell a really large number of bitcoins has a limited number of brokers and services to turn to. There's far more liquidity in fiat/banking systems to slip by unnoticed.

I don’t think that governments will hold or accumulate bitcoin or even other altcoins because they are the one who wants fiat to increase each value since it’s the basis of the growing economy if the value of the currency of each country increases

But what I think is people inside governments are doing so,surely that atleast politicians or government employees are accumulating cryptocurrency because people can’t resist the future of crypto specially those who has knowledge about advance technology

I'm not going to be surprised if nation/states/governements are trying to accumulate bitcoin. Because in my country, one of the politicians is taking interest in cryptocurrency and launching his own cryptocurrency which is the pac coin. If a country supports it, then the government officials must be trying to accumulate some knowing that it can really be profitable.

Any country in the world that may be participating in  bitcoin mining or any means of accumulating some huge amount of bitcoin can be described as just being smart and wise. Times has really changed and it would not be surprise if any power house country like North Korea or the USA is secretly mining bitcoin. This would eventually give them more power when bitcoin becomes a mainstream currency in the world.

Spoiler: most of those farms in China where 81% of the hashing power is, are owned by the CIA, they just hide their true hashing power in different pools and country`s, for now. The USA Government has over 51% of the hashing power.

#True

What stops this? nothing, other than making each person 1 node and give equal hash rate to each participant, which would require KYC. Does not mean your KYC has to be given to a centralized body, or cooperation, but a neutral decentralized AI and blockchain can check this for us.

When you said that, something came into my mind also. We all know that Gold is being used as an investment tool maybe it will be an ETF or Futures market, it's being used. So knowing that aspect, as you suggested that it's not much any different, maybe Nations/States/Governments are going to produce something similar to that and have people speculate prices too but controlling that market would be the advantage that they would have, which is what they want, control

Anyway, there are a lot of differences between Gold and Bitcoin, and it could be discussed in another topic though.

if you buy a game worth $10 and price goes down from $10500 to $9500 the seller loses $0.95. but when you are making a gigantic trade like selling oil per barrel per day worth $50 million for example, the same price drop means the seller loses $4.76 million. same goes with case when price goes up. and that what volatility does to large transactions.

similarly you can "convert" $10 to and from bitcoin, even $100k or $1 million one time but you can't do the same with something like $50 million every day. the market isn't even that big to absorb that much. (just now it took only ~800BTC=$8mil to push the price below $10k again)


How many people own Bitcoin, and how much do they own? How can the government prove, and will the people declare it?

Better to tax people in fiat, and use that to subsidize Bitcoin buying/mining.
[/quote]
all they need to do is to regulate exchanges and force them to give a list of all transactions every user made. now it is not up to the "people" to want to pay their taxes or not, if they don't they are evading and that is illegal and can have jail time.

It seems that they are not publicizing this matter, we cannot know the amount they hold. But with the development of blockchain technology and this hot currency, I believe that governments and countries will sit still.

Not that limited. In fact, liquidity is always increasing. Or, Bitcoin might remain a "small niche", but it won't, by any means "be small".

When governments accumulate bitcoin, automatically the circulation will get disturbed. This will get reflected over the market of bitcoin. Same time the less supply apart from the bitcoin that's been accumulated will create increased demand for bitcoin. This will create more value for the bitcoin. As bitcoin is manipulative, governments will surely try to manipulate and get benefited same as whales doing at present.

I can agree that accumulation of Bitcoin done by governments could disturb the market. Simply because such accumulated amounts wouldn't be small and Bitcoin supply is limited. But that is just the theory, in real life governments have no intention to accumulate Bitcoin or any other cryptocurrency.

I would have thought countries like North Korea should have been accumulating or make the country a mining hub of bitcoin for her citizens in order to get off the hardship of many years of sanctions, but it appears little rocket man is more concerned about nuclear weapons than economic growth of his nation.

except if people are simply using Bitcoin as money. then it behaves far more like cash, the information as to who sold what to who doesn't necessarily exist.


and sure, people can be jailed (maybe even only because they refuse to disclose details of their BTC activities, which defies basic legal foundations, but it's all just a figleaf for surreptitious gangsterism anyway).

But I'm not paying these clown gangsters a single satoshi, and I'll still have all my money if I were ever released from any jail sentence.

it depends if they or one of thier members know about bitcoin or as long as they are interested , they will surely invest on it  .

they can keep it as a secret or not but what will be the benefits that they can get if they will publically announced that they are involved into bitcoin ? maybe they think others will follow and others will also invest which result for the value of bitcoin to increase and thats the time that they get the benefit because they can sell thier btc at a higher rate .

Shower thought. Governments are at an advantage if they decide to build their own mining farms because they can mine at cost/at loss, the people are taxed to subsidize it.

https://twitter.com/bloqport/status/1263594019545706498

Why would government of countries do that? When they know they can print their local currency whenever they want. Bitcoin is still not a global currency. Countries like North Korea and Iran do. It need Bitcoin but USD. They have been secretly accumulating USD by unfair means.

Bitcoin is the currency for common man to break the shackles of centralisation and save his savings. It is a currency of the Internet and countries do not operate only on internet.

If they are buying they must be doing it in a very low quantity because the price isn't moving like it would if institutions were moving in.

You should understand that 100 million dollars for a country is like nothing. They can snap a finger and buy that in bulk right now but we don't see 100 million purchases often.

Maybe they are doing it over a long period of time but why would they play around like this if it's such small money for them?

think its time windfury changes his soap

anyway shower thought
why do governments even nee to spend money buying coin/ mining coin,
they just got to declare a mining farm as 'stealing electric from the grid' and take the equipment/coins
they just got to declare a exchange as an illegal operation and take the coin

it didnt cost much to grab silk road funds. nor some now defunct exchange funds.
there is supposedly 500k coins still locked up in MTGox keys too..

all grabbed without a single asic purchased or government fiat -> exchange purchase

In the past, there are a lot of articles, news, some theories that North Korea is actually saving money, hacking, plotting heists and if you actually watched the video of Kento Bento about the North Korean Heist, well, I just learned it there the first time. If they will be turning to bitcoin, then I guess they wanted to control. They are planing something and gaining money is the start of it.

https://www.forbes.com/sites/kateoflahertyuk/2019/08/07/north-korean-hackers-2-billion-heist-is-funding-wmd-programs/#702b5b0038fb
https://www.ft.com/content/cbb28ab8-8ce9-11e9-a24d-b42f641eca37
forbes.com/sites/leemathews/2019/03/11/north-korean-hackers-have-raked-in-670-million-via-cyberattacks/#55bbb7947018
https://edition.cnn.com/2019/03/01/politics/north-korea-cyberattacks-cash-bank-heists/index.html

Not necessarily, Iran has one of the lowest electricity prices in the world even without subsidies.

https://financialtribune.com/articles/energy/97278/rise-in-electricity-and-water-tariffs-in-iran


That's what Venezuelan authorities have been doing for a couple years already.

Iran too: https://www.theverge.com/2019/6/30/20635616/iran-bitcoin-computers-seized-energy-consumption but that one was about illegally using subsidized electricity afaik

In the case of those 2 countries you mentioned, publicizing it would be the last thing they'd do. It could negatively impact bitcoin's reputation which might drive down price in meantime. And it could also make them target for cyberattacks to try to disable their hoarding attempts.

It's hard to say they are holding because as a government, they should be transparent on how they will manage the wealth of the nation.
Also, it's kinda odd that a government who like a centralized policy investing in a decentralized system, if they would like bitcoin to be a success in the future, then they should be legalizing everything to give way on improvement of the adoption process.

Bitcoin has always been an speculative asset, being a store of value is sometimes makes people doubtful due to its price volatility.

::)

I don't know frenkie. It's Iran's president calling for a crypto mining strategy.

Maybe he believes they need censorship-resistance, and Bitcoin is that path to go around trade sanctions by the U.S.

Maybe he believes the Bitcoin protocol is useful for prevention of asset seizure.

Or maybe, he believes it's important to help secure the network that could give them those properties they need.

Maybe they also want to trade heroin. I don't know. 8)

I think it's a real possibility. Bitcoin can be useful for making unofficial but important transactions. It's also useful to cut back on international transfer fees, especially if we're talking about a big sum of money. Some might also slowly accumulate BTC in a hope that they might eventually take over the control by owning a huge percentage. It can also be an investment option just in case your economy collapses. There've been multiple countries which have been caught doing stuff with BTC, so I think it's true that they do that. In my country, there've been serious talks with the Ministry of Ecology and Natural Resources offered nuclear power plants to make crypto mining facilities to make sure the energy they are making has a place to be directed to. The head of the Ministry called it a worldwide trend (see here (https://hromadske.ua/posts/ce-svitovij-trend-minenergo-poyasnili-dlya-chogo-majniti-kriptovalyutu-na-aes), but it's in Ukrainian).
However, I don't think the scope of all these actions truly threatens the decentralization of Bitcoin.

They don't. A lot of the governments around the world do not disclose about the things that they invest in as it concerns national security. Let's treat crypto as a reserve currency. If governments disclose the amount of reserve that they have, it could have detrimental effects since outsiders would know exactly how much they have.

Governments like North Korea could potentially be using cryptos as a way to circumvent international sanctions and disclosing it would only make the world impose harsher sanctions.

Based from the news that says North Korea supporting cyber groups so they could earn money, I guess they are.

There are a lot of talks about North Korea planning heists all over the world to accumulate the money they might use to improve or develop their military forces. Some government officials are obviously thinking about this but they can't really do nothing since right now, most of them are more busy dealing with the current pandemic.

I doubt any country would accumulate and hold bitcoin for a long time. They would rather develop their own digital currency and that's what we are seeing now from countries like China. They even made a proposal recently to issue a regional stable coin that will be backed by four major currencies in Asia. 

For Iran's case, they are already taxing the miners. That's probably better than getting involved with bitcoin.
For North Korea, they are reportedly connected with hackers attacking crypto exchanges. I don't think they want to declare they own bitcoins.


I bet there are government controlled banks who are already buying and selling bitcoin. They don't have to use bitcoin as a currency but they can still invest in it the same way they use depositor's funds to invest in real properties and stock market.

I don't think they are, if they are really accumulating btc why is it not reflecting on price! Do you know what it means for states/government to accumulate btc,  it would mean huge money is coming in, which will also mean price hike is inevitable, at least there will be signs that certain top personnels or organisation are buying,
But if they are, the advantage will be in their profit, what else can it be, more money more power.

They could be buying or mining, but if they did it openly, it might cause the whole thing to backfire due two the following things:
1. The people would see it as a weakness. Maybe the government doesn't truss the fiat it's printing, maybe the inflation is higher than they're telling us? The news of the hovernment buying Bitcoin might cause a bank run and destabilize the country.
2. The news could cause another bitcoin bubble, making it unable for the country to continue the strategy. They might want a bubble to happen eventually, but first they need to buy/mine enough and buying enough is difficult and time consuming when you want to stay under the radar.

maybe its nothing to do with bitcoin at all.. and instead a newly created Iranian national currency of its own

Then that would be a mistake, a waste of resources, and very stupid in my opinion. They would be mining a shitcoin, that literally no one cares about.

not some random coin. but a national coin that has beenput into legislature as the national currency. thus instantly making it relevant to its citizens

also mining is not for profit dependant on hashpower/coin per block. it doesnt matter if a coin owner mines 50 coins a block or 5000 coins a block.
it does not matter how many asics are used.

if a national government puts a value that 0.00001 coin = minimum wage labour hour
and they have the coin as a DLT (distributed ledger tech) where the mining aspect is centralised to government banks. and the ledger is then publicly distributed.
then the banks dont need to play the fighting competition for blocks.

meaning normal users/outsiders cant mine. but they have access to make transactions and verify.
and the banks by law instantly would have coins valued at 100,000man hours a coin. even without having to put in alot of asic hardware

 ::)

Hahaha. BUT useless outside their country to go around sanctions, and censorship-resistance. What's the point?

It's just going to be another shitcoin in my opinion. A shitcoin that no one would use, because, well, why would anyone accept it? It's a shitcoin, worse than Dogecoin. Bitcoin is already self-boot-strapped, with the most liquid market, and ready worldwide.

I believe you underestimate Bitcoin's network-effects, frenkie.

people around the world wont use it under a pretense of a 'new world order single coin'.

think of governments making their national currencies more digital

as for the shitcoin thing
yes to americans the Euro is a shit coin.. and yes europeans will think the dollar is a shitcoin. but if a government implements their own currency. then its citizens within each nation will use that currency of that nation because.. its the legislation/law.

bitcoin is only good because it has uses. yep if people couldnt buy pizza, alpaca socks, cupcakes and ofcourse silkroad stuff early on. bitcoin would not be the same fame it is today
trying to detach that purpose from bitcoin will ruin bitcoins desire.(although i know you dont care and just want another network taking the fame)

a government cryptocurrency wont be for the benefit of letting citizens mine it for profit.
history of  currencies purpose is not for profit of making the banknote/token. its for what the banknote is useful for. and the same applies today.
anyone can make a currency. but unless you can actually buy things with it. its useless
(again you purposefully dont want bitcoiners to remain using bitcoin as a daily currency. (facepalm))

anyway
what a government cryptocurrency would most likely be, is different government departments with just one custom asic in each department with just a daily electric cost of $50 but mining millions a day.
distributed in different departments to avoid a single actor(government worker) from hacking it
secured by hashes that are only accepted by government departments. thus no random '51% attack' vector
by any single government worker or hacker

anyway
government sanctions dont care what currency a country uses. they just care about penalising a country. whether that be through a fine. or even forcing a country to prohibit movement, or stop producing or exporting certain goods.
sanctions can be in many forms such as being forced to buy another countries produce or pretented from buying that same produce from another country.

EG russia stop buying european cheese and buy american instead
EG stop making missiles and make space shuttles to taxi americans to the international space station
so even if a country did adopt a crypto currency. they will still be sanctioned.


..
but back to the point
i think you are mixing up a country wanting to make its own crypto. with the stupidity of thinking a country wants to take over bitcoin..

treat it as 2 separate conversations. and realise bitcoins only real risk is idiots trying to make bitcoin less useful by trying to sway merchant to use other networks instead

THEN it would be the same as fiat. Another stable-shitcoin. They won't be needing a "national crypto mining strategy".


Separate? The "conversation" is about government/state-subsidized mining, frenkie.