The Real Reason for Bitcoin's Rise

[BobK71]

It all sounds logical explanation but a question came to my mind when I read, here I quote "Traditionally, that non-state money has been gold and silver.  Today, the (Western) elites are using Bitcoin and other cryptos to play that role". end quote. It needs to be further explained why would they choose bitcoin over gold and silver, for this purpose?

Yes, thank you for asking.  It does need to be explained in detail.

Remember, gold was at $35/ounce the last time the elites openly managed the gold/dollar exchange rate.  If they want to attain true stability by openly managing the exchange rate again, gold would have to worth low to mid 5 digits in dollar terms, in order to cover a significant portion of the money supply today.  This would be embarrassing to the elites and their issued money by exposing it as a system of theft by inflation.

Cryptos are thus an almost perfect solution.  They can push/let cryptos rise (hugely) to a level that will allow them to openly manage crypto/fiat exchange rates, and thus achieve good stability, but claim that the reason is the appeal of the new electronic foundation of money, not the inflationary nature of state issued money.

Another major 'benefit' of cryptos is that the supply is actually almost unlimited.  When their state money has been issued too much for their stock of Bitcoin to support, they can gradually add in other cryptos to do the job.  (And that is why they are supporting altcoins from day one.)  They can claim that this or that altcoin provide features that improve on Bitcoin.  Since the variety of possible features in software is virtually unlimited, and later-developed software tend to be genuinely better than earlier designs, their base money supply can expand much more easily than gold and silver -- and thus allowing them to benefit themselves more by issuing money and other financial assets.

[Jake052478]

The world has started to realize how bitcoins plays in the world today... Many countries have opens its door to Bitcoins or cryptocurrency nowadays... howbeit, the reason for Bitcoin's rise.  The demand has raised since it birth and although many countries want to stop it,  the use of bitcoins has already proliferated... The ease of payment of so, the carrying of cash in our pockets has diminished if not gone ... and all that stuff... lead to the use of cryptocurrency more easy....

[GeniusAko]

The main reason why the price of bitcoin is rising is because the bitcoin is becoming popular all over thw rodl and the demand of the people to the bitcoin is now high. So the fluctuation is the real reason.

[BobK71]

The only real solution to this problem, from the elites' point of view, is to inflate away the debt without destroying the trust in state money.

That's assuming the end game isn't a stealth scorched earth policy whereby elites favor global depopulation over economic stability.

Years ago a scientist named Dr. Eric Pianka (AKA Doctor Doom) espoused the idea of 90% of the planets human population being wiped out by natural disaster or plague being a good thing for the earth and its natural resources. He was applauded by his peers.

One might say politicians insistence on opening borders, raising taxes, higher spending, greater outsourcing of jobs, greater automation of jobs are designed to crash the system and destroy nations. There hasn't been a real effort made at stabilization. Everyday society becomes more fractured and broken. There isn't a counter culture movement in the opposite direction. Any upside occurring as a result of crypto innovation are entirely incidental and unintended.

Although one can never be totally sure the elites won't take extreme action, my view is that, (1) they would be at great risk of failure; and (2) why do it when devaluation/inflation is available as a more humane and thus safer solution.  (It has just been made even more appealing by not having to let gold go up too much, by using cryptos.)

The global empire is not the centrally controlled Chinese universe of 1000 AD (which did try and succeeded for a few centuries to use repression alone to support their inflated money system.)  The modern imperial system relies on a combination of hard and soft power.  Neither power is enough, on its own, for success, but the combination has proved good enough.  Believe it or not, the US *is* a freer and more open society, with a freer marketplace, than Russia and China.  The empire can't change its core nature overnight.

Outsourcing and the breakdown of trust in the media have led to the election of Trump.  Discord and other negative energy are not a good thing for people who skim the cream of production.  No, I think we have to give credit to the elites for folding their hand when it becomes clearly hopeless, unless we see more evidence to the contrary.  (And especially since they don't have to look like they're folding.)

[BobK71]

From my point of view, so many reasons boost the price of Bitcoin, like the adoption, the increasing number of user cases, the maturity of its principle.

Exactly, bitcoin is totally embraced by everyone and create a huge impact to our living and in our economy. There is something in bitcoin that attract more investors and users, and that is of it's promising price. And now bitcoin is still coming back from its fall and it will become more stronger as it will survive from crisis.

Sorry to say, unfortunately, even if the rise of Bitcoin is due to true supply and demand (a big if,) the elites could still kill it over the last few years if they wanted to.  And they can probably kill it today too.  (Remember what Jamie Dimon just said.)

[btc-facebook]

The world has started to realize how bitcoins plays in the world today... Many countries have opens its door to Bitcoins or cryptocurrency nowadays... howbeit, the reason for Bitcoin's rise.  The demand has raised since it birth and although many countries want to stop it,  the use of bitcoins has already proliferated... The ease of payment of so, the carrying of cash in our pockets has diminished if not gone ... and all that stuff... lead to the use of cryptocurrency more easy....

When bitcoin getting popular , more company or even CEO try to use this technology since bitcoin can do things that fiat can't do
It's very useful especially in this digital era , everybody need some great innovation on transaction worldwide

[Yuhee]

The world has started to realize how bitcoins plays in the world today... Many countries have opens its door to Bitcoins or cryptocurrency nowadays... howbeit, the reason for Bitcoin's rise.  The demand has raised since it birth and although many countries want to stop it,  the use of bitcoins has already proliferated... The ease of payment of so, the carrying of cash in our pockets has diminished if not gone ... and all that stuff... lead to the use of cryptocurrency more easy....

When bitcoin getting popular , more company or even CEO try to use this technology since bitcoin can do things that fiat can't do
It's very useful especially in this digital era , everybody need some great innovation on transaction worldwide

A lot had already invested in btc but the catch is sometimes the identity of these investors are sometimes unknown. A lot would say they are into btc but with the certain anonymity of btc, its hard know who invested how much. There are still many btc virtually and i think from this time developers are making blocks to ensure that if ever the supply runs out, there would be other blocks that could be released

[BobK71]

Is this a legit news or one of the conspiracy theories that involves Bitcoin. I still believe that Bitcoin Price is rising because of the simple rule of supply and demand.

Before you consider whether to believe this theory, consider that the core financial markets have never been free in post-Renaissance Western history.

As early as the Spanish global empire of the 1500s, assets were inflated by the massive issuance of debt, payable in physical gold and silver, by the monarchy.  The debt was considered safe since it was backed by the power of the global empire.  If you held physical gold/silver, you lost out on the 20+% interest offered by the IOUs, but lived under the same price inflation caused by this system.  If you bought into the debt, you helped fuel the imperial system of inflation and theft from savers, and helped push the whole system to eventual collapse (and pain for the average person.)

Fast forward to our time -- things have got a lot more complex, but their nature hasn't really changed.  There has never been either true freedom or justice.

Modern history is the story of too much wealth and too little understanding.  We practically beg the elites to abuse us, and abuse is what we get.

[Schuyler]

Is this a legit news or one of the conspiracy theories that involves Bitcoin. I still believe that Bitcoin Price is rising because of the simple rule of supply and demand.

I think it's  a legit news. We follow and observe the recent price fluctuation . It is often associated by experts with speculation on the cryptocurrency markets. I think the increase of price is because the new institutional money are coming to the ecosystem. Not only bitcoin price is up, all major digital assets are up.

[Dudeperfect]

We should not ignore the role of institutional investors in the growth of Bitcoin. We also have investors organisations having their capital in Bitcoin other individual investors. Their intention is pure speculative gains from this investment and I don't think that $5K rally was a natural rally.

Now coming back to the fiat system, I agree that we have larger a force to maintain the trust in the fiat system and they will even adopt Blockchain technology to improve this system but that won't affect the price of Bitcoin for the long term.

[Lpim01]

Is this a legit news or one of the conspiracy theories that involves Bitcoin. I still believe that Bitcoin Price is rising because of the simple rule of supply and demand.

Supply and demand could be a big factors that mostly affect bitcoin price. Rise and fall is just a normal scenarios that might happen in any investment.
Actually price is not controllable because it is totally depend on the flow in the market, and no one will be liable for any changes that might happen.

[kafiddrhman]

Is this a legit news or one of the conspiracy theories that involves Bitcoin. I still believe that Bitcoin Price is rising because of the simple rule of supply and demand.

Supply and demand could be a big factors that mostly affect bitcoin price. Rise and fall is just a normal scenarios that might happen in any investment.
Actually price is not controllable because it is totally depend on the flow in the market, and no one will be liable for any changes that might happen.

perhaps on the basis of this, which is always a consideration from the government of each country to legalize and adopt bitcoin as the official currency and has a function equivalent to the real currency.

[Mpamaegbu]

OP, the picture you painted sounds more of a hypothesis than statistical fact. It certainly can't be proved. One can conveniently look at the reason for bitcoin rise (as in its popularity) from the fact that it was a rare intention anchored on the internet space at a time when the world is going global. The real money is not cash but intellectual and that is really what has fuelled the Bitcoin. And now that China has banned it, more awareness and frenzy is going to be thrown open on the Bitcoin.

[maku]

Great opening post, as always. I share the same opinion - our whole financial system is based on debt, we entered the spiral of debt it takes slowly over the everyone's life.
At some point in the future, we will hit the wall, fiat money at that point won't give you anything as it will be worthless due to lack of faith in central banks power to keep everything under control.
Bitcoin as a sovereign currency is an attempt to give some of the power in the hands of the people. As soon as more people will realize it the better our future will be.

[Sled]

The real reason for the rise of the price of bitcoin is about the doubts that has been cleared or gone in the market because if you will see that the price of bitcoin is very low in the past few days because of the FUDs that are widely spreaded in the market so if you really buy at that time then you already gained profit right now which is a reason in why bitcoin is a great investment.

[suryati]

I think some factors influence the bitcoin increase one of them is the user's belief in the bitcoin power so it will not let bitcoin down drastically, otherwise a good system has been built by the developer and I think this is the bitcoin power to deal with the issue of negative issues that arise.

[@prashant]

I think some factors influence the bitcoin increase one of them is the user's belief in the bitcoin power so it will not let bitcoin down drastically, otherwise a good system has been built by the developer and I think this is the bitcoin power to deal with the issue of negative issues that arise.

market is influenced by whales only,they decide what value bitcoin will have,or the hype decide what next value it will get. crypto market is clearly different from stock market and it is manipulated solely by whales or mining farms.

[investeerder]

I think some factors influence the bitcoin increase one of them is the user's belief in the bitcoin power so it will not let bitcoin down drastically, otherwise a good system has been built by the developer and I think this is the bitcoin power to deal with the issue of negative issues that arise.

market is influenced by whales only,they decide what value bitcoin will have,or the hype decide what next value it will get. crypto market is clearly different from stock market and it is manipulated solely by whales or mining farms.

Well that would be the real scenario and they will back it up with fuds and hype news so that they can create panic and can fully manipulate the market and actually this kind of tactics by the whales is somehow effective since I saw so many different of hypes that affect the price of bitcoins. So we should ride on them if we want to earn and stake wheter the dump is ongoing.

[Saoha]

Central banks and other elites have painted themselves into a corner.  There is too much debt in this world, and all of it is based on fiat money that central banks can print.

The elites must maintain trust in this fiat money by keeping inflation low.  That means, one way or another, all the growth in wealth must go to a small number of people.

But the more inequality they create, the more distorted and unstable the system becomes.  That is, more and more 'fancy' goods and services are produced just to satisfy the whimsical demands by the lucky people.  This demand can disappear any time financial asset values go down.

So central banks must keep financial asset values high just to keep this demand going.  But this only worsens the inequality, and the cycle continues.  Eventually, something will have to trigger a financial asset crash.

The only real solution to this problem, from the elites' point of view, is to inflate away the debt without destroying the trust in state money.  And the only way to do that is to devalue state money against non-state money.  Traditionally, that non-state money has been gold and silver.  Today, the (Western) elites are using Bitcoin and other cryptos to play that role.

You will not hear this perspective from the mainstream media or establishment economists!

Yes, and I think Bitcoin simply is follows the rules of human development, equipping itself with the advantages that other currencies can not have, surpassing the boundaries between nations.
And importantly it benefits those who trust and invest in it. This proves through process since Bitcoin was born to the present. The future of Bitcoin is very bright!

[BobK71]

For all of you who think Bitcoin rose because of free-market supply and demand (and thank you for sharing your thoughts BTW,) I have only one question:

Why are the US elites allowing it to rise (if not secretly buying it -- there is some evidence for that)?

They only allow it to rise because it will benefit them -- and this means they are planning to use it to back their dollar, one way or another.  They could easily have tried to destroy it, since truly hard money competes with their money-issuance power, and also tends to cause their bubbles to burst by deflation.

Just remember everything they did to suppress the price of gold.  But they didn't do it to Bitcoin.  Why?