An interesting observation I'd like to share from watching Bloomberg data, is that Bitcoin prices slid on the news that the straight of Hormuz might be blocked by Iran as part of it's undeclared war on Israel. But why is that? Bitcoin bros are normally hyping up their scam as some WW3-proof system that will survive Nuclear Armageddon.
I think this inverted covariance is simple. Bitcoin in the scale of All Things is growing but is still small, and from the investor's perspective it's a simple value-add product or service, on top of energy. The AI and data-centre story is similar. When energy prices go up the yield on mining and therefore all the high-frequency trading and arbitrage under it, goes down.
Here in the relative peace of New Zealand I've met just as many Isrealis and Iranians and my thoughts go out to all affected by this conflict. I think that in particular Israel is subject to some unjust analysis in media, and similarly the voices of Iranian dissidents are unheard while an Islamic dictatorship claims to speak for them. It's the voices of both Isrealis and Iranians I turn to in these events.
I understand how things like Bitcoin may appear to offer financial emancipation to people under authoritarian rule, where currency is certainly misused to exert control, but I would not suggest Pyramid schemes of which Bitcoin is one example, are a viable alternative to that. During the break-up of the USSR there were examples of Pyramid schemes getting out of control culminating in Albania descending into civil war.
Of course it is not as simple as that, and corruption in the post-Soviet CIS states remains an issue to this day, but with neighours like Russia, can they really be blamed? What is clear to me is that Pyramid schemes are a system of theft denounced across cultures and religions, even the Bible tells of Jesus flipping tables. The scam is that old and Bitcoin is just it's newest face. Maybe there is some unity in that realisation.
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