I had believed in some of those ideas of differing OTC prices, yet I am not really buying that story anymore either.. so OTC prices are still likely largely within 5% of the exchange prices.. Sure there might be outliers, yet guys are likely finding it quite difficult to obtain BTC for prices that are way out of sync with exchange prices..
Luckily this is a limited edge.. but I imagine it is still there for now.
We can agree to disagree.. I have quite a few doubts that these days the price differences between OTC and exchanges are very large.
I might not be expressing my thoughts clearly. I do not think there is a big difference between prices at exchanges vs OTC prices. Certainly not a "discount" either. In fact I think a buyer will likely pay a price HIGHER than retail market prices for a very large OTC trade for the luxury of not having to incur slippage.
But the main bit of what I believe is happening is perhaps best seen in this particular example.
Blackrock buys a large lot of Bitcoin OTC from wherever -> They set aside 15% of this purchase -> The other 85% is used to back incoming orders to IBIT shares. -> Now they use that 15% to hold or drop prices at the top exchanges. Then repeat... but with the advantage of prices being lower than they would have been without their dumping.
This would only work if retail trading was much shallower than OTC trading for an ETF or corporate treasury. And I think arguably it is. And if the 3 largest buyers of bitcoin were to coordinate this action they would be even more effective.
The key thing here is where the action for DEEP buys is happening is separate from where the price (oracle) is decided.
If there is a large enough imbalance between retail and OTC depth/volume then they would be fools not to exploit it.
And like EVERY exploit the shelf like of this trick is limited.
AND when they can't do it anymore the price will then release all that energy that had been held back. Possibly in a fairly short amount of time.
Well I am naturally dramatic, and life has dealt me some difficult cards (along with some good ones) in recent times and that might add to my negative side. I dunno.
I am pretty sure that you are not a bear, but you come up with some doosies sometimes, and even though I don't have problems considering some of those kinds of "out there" ideas, there likely still needs to be some kind of thread in your posting of these ideas to remind normies (especially normie newbies) that it is best (in their own personal interests - not just to save bitcoin blah blah blah) for an overwhelming majority of newbies (no coiners and/or low coiners) to keep buying bitcoin persistently, consistently, ongoingly, regularly and perhaps even aggressively, even if some variation of your overly and unnecessary negative (seemingly wet dream for bears) scenario ends up playing out.
I am not a bear in the slightest. In fact I am probably WAY more bullish that the current sentiment. I think most likely we are witnessing a sort of adolescence for Bitcoin. It is growing out of it's turbulent emotionally volatile childhood into a more stable adult who may not have the sort of highs it had when it was a little kid, but conversely does not have the sort of lows either. But the magic is nothing can stop the inner nature which is "it's going up forever, Laura".
On this silly chart the black line represents the ideal BTC price rise if it could be calculated purely on demand/supply, and that there were no other factors like demand increasing at different rates, and human psychology. And the orange line represents what we have experienced so fas as the 210000 block cycle.
My thesis (and this is hardly original) is the orange line is going to constantly approach the black line over time.
A further bit of my thesis is the ideal line will not be linear, but an logistic curve more like this:
So now you could plt the orange line with it's crazy extremes over this ideal.. but this time reduce the variance in the orange line as you move right as well. It will never reach the ideal. There would have to be infinite demand sources at all times for that to happen. So there will always be ups and downs... AND they may follow the 210000 block cycle for quite some time.
So...
I think I also have a tendency to state extreme scenarios as if they were facts when I am working through the full array of possibility. I might be proclaiming the supremacy of the inevitable (in my view) S-curve in one breath, and lamenting the deepest possible valley of the orange line of human interference in the next. And these would SEEM contradictory, though they are not.
For example. At this point the real power brokers like Blackrock are either simply trying to control as much Bitcoin as they possibly can, or they are participating in a complicated, and possibly VERY dangerous to them, gambit to do what Charlie Munger said which is to tame (or control) Bitcoin and neutralize it in the way they have Gold.
But the facts as they currently lie do not support this dire scenario. And even gold (which they most definitely HAVE neutered) is slipping away from them. Bitcoin does not have the same attack surface of gold.
So, I will often try to steel-man the argument against my current beliefs to try to attack them. And I will do this publicly here. Let me make the strongest argument I can to support the idea that Blackrock is in league with the fed and the US regulatory agencies to destroy bitcoin by holding lots of it and/or selling paper bitcoin. But this would require government collusion since IBIT is REQUIRED to back all it's shares with 1:1 BTC holdings.
Is it possible? Hell yes. Is it likely? Less and less the further we go.
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supercycle)
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