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21 Feb, 4 tweets, 3 min read
THIS PASSAGE in interview of James Grant by Kevin Duffy struck me given heartbreak in Texas. Interview predated Texas storms.

Commodity mkts have been booming generally, driven by tight supply

When demand spike hits tight supply, prices ⬆️. It’s not just happening in #bitcoin
BTW, the price of a gallon of gasoline is up about 20% since Jan 1 near me. Ouch. #inflation
“What matters to me...is speaking up...for the great institution of corporate solvency (you’d be surprised how controversial it can become at the end of a boom).-James Grant @mises

I agree—corporate solvency can go out window in bull mkts. Happens to #bitcoin intermediaries too
#history #wisdom from James Grant @GrantsPub

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More from @CaitlinLong_

Caitlin Long 🔑 Profile picture
9 Feb
1/ HAPPY #TESLA DAY, #bitcoin! Two things in the announcement caught my eye🧐& are worth pondering.🤔

* the $1.5bn #bitcoin purchase was 7.7% of @Tesla's $19.4bn of cash. Why only 7.7%?

* Tesla plans to accept bitcoin as payment but "may or may not liquidate upon receipt." Why?
2/ Why only 7.7% of cash? Well, @Tesla confirmed it's using indefinite intangible accounting, which is UGLY treatment (lower of cost or market+risk of impairment charges). We bitcoiners must work to get bitcoin acctg fixed. It's prob why Square only put 2% of its cash into #BTC.
3/ What gives? "Impairment charge"=☠️. Cos hate them bc they cause sudden hits to earnings. I'd guess Tesla & Square ran scenario analyses to see how big an impairment charge they cld tolerate in a #bitcoin bear mkt, & sized their investment based partly on that (+other factors).
Read 14 tweets
Caitlin Long 🔑 Profile picture
16 Jan
1/ FASCINATING few weeks for social media—the migrations away from big platforms by fed-up users has been MASSIVE. Users proved we’re MUCH more powerful in ecosystems than many ppl thought (vaguely reminiscent of #UASF event in #bitcoin).

The b4 vs after venn diagram of the...
2/ ...social platforms & news sources I use has surprisingly little overlap. I’m trying many new platforms (today I happened upon a great Clubhouse chat room on #crypto law w/ @propelforward. Clubhouse is gonna disrupt podcasts in a v big way, IMHO). Follow me if you’re there! 🤠
3/ I don’t plan to leave @Twitter but I’m not wedded to it either. None of us should be! When 40m people sign up for one new platform & 25m for another in just days, you know something big is afoot.

Related, one of my mentors said something v wise:

#bitcoin will hack big tech.
Read 4 tweets
Caitlin Long 🔑 Profile picture
14 Jan
1/ HEY PEEPS—lots of folks asking abt @Anchorage OCC trust charter—again, congrats to Anchorage!💪👏 But OCC trust charter is narrower than #Wyoming SPDI charter. OCC trust cos can’t take deposits or directly access the Fed’s pymt system. Here’s the thread I promised. 👇
2/ Key=there’s a pecking order among types of bank charters. At the top of food chain are the mega-banks that can fund US govt. Next=banks ("depository institutions") that have direct access to the Fed’s payment system. Below them are banks & trust cos that don't have such access
3/ OCC trust cos are in the 3rd category but #Wyoming SPDIs rank above them, in the 2nd. To be eligible for direct pymt system access at Fed, the bank must be a "depository institution" (as defined in 12USC461). Wyoming SPDIs are depository institutions, but OCC trust cos aren’t.
Read 19 tweets
Caitlin Long 🔑 Profile picture
23 Dec 20
WOW--#crypto lawyers will be EVEN BUSIER over the break (as if the Mnuchin rule, SEC v Ripple & CSBS v OCC lawsuits weren't enough...). There are weeks when decades happen, as they way. For crypto law, this is one of those weeks
2/ PS--I suspect both SEC moves this week are tied to @coinbase's IPO filing, which will force the open questions re: which cryptos are securities to be answered in 2021. As mentioned earlier, IMHO the SEC will be one of (if not *THE*) most important players in US #crypto in 2021
3/ oops -- as they *say (excuse the typo!)
Read 4 tweets
Caitlin Long 🔑 Profile picture
15 Dec 20
1/ GREAT ARTICLE abt how financial mkt plumbing really works, incl the real reason why Lehman failed & why the same probs still mostly exist: #rehypothecation + a shortage (!) of collateral despite frenzy of new govt debt issued. @JeffSnider_AIP @RaoulGMI realclearmarkets.com/articles/2020/…
2/ But lemme connect 3 dots abt how it relates to #crypto

* There's a SHORTAGE of collateral (T-bills, etc)--the stuff big dealer banks NEED in order to fund themselves. Facebook Libra/Diem could worsen that shortage a lot, so you can see why central bankers view it as a threat.
3/ The #repo mkt periodically has disruptions caused by collateral shortages/undercapitalization of the big dealer banks. @JeffSnider_AIP looks at March 2020 in this piece but many other examples exist, eg Lehman in 2008. When repo mkt seizes up, the probs ripple across fin mkts.
Read 14 tweets
Caitlin Long 🔑 Profile picture
11 Nov 20
As #Ethereum works thru its #hardfork, worth asking these ?s abt your exchange/custodian:
* if it no longer supports the old chain, can it just break its contract w/ you?
* can it keep the forked coins or must it give them to you?
#Wyoming law has consumer protections for this!🤠
It's situations like this that will REALLY set apart exchanges/custodians using #Wyoming law to govern their contracts w/ US customers. 🤠Non-Wyoming law intermediaries tend to have contracts that favor the intermediaries🙁, & courts tend to uphold them:
coindesk.com/appeals-court-…
3/ One thing seems clear--there will be more litigation in the US for situations like this (bc there's more value involved now vs past). Also Cred bankruptcy, which is first substantial #crypto bankruptcy in US courts, has already attracted attn of consumer protection advocates
Read 4 tweets

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