1/ Nearly 5 years ago, I posted a thread at $3,500 BTC explaining how #Bitcoin’s extreme volatility is a feature of its monetization process.

Outsiders are perplexed by 10x returns and 80% drawdowns, but Bitcoiners recognize this is hyperbitcoinization.

x.com/IIICapital/sta… 2/ @JoeSquawk has noticed this.

Andrew mentioned BTC has been "going nowhere" ($26,000) despite a potential impending ETF approval, yet Joe notes “it was $4,000 when we started saying it wasn’t going anywhere."

That's a 6.5x increase, a 550% return.

x.com/WalkerAmerica/…

1/5 The Lightning Network’s interest income opportunity is a revolution in finance for two reasons:

1. Lightning offers interest income without default risk.

2. Income without default risk means we now have an internationally credible risk free rate of return. 2/5 How?

Just like oil provides the energy to drive the oil tanker, sats provide the digital energy to route sats to the recipient of a lightning payment.

Node operators get paid to provide the digital energy to route sats but you remain in custody of the sats at all times.

1/ Bitcoin mining rigs (ASICs) are a segment of computer hardware that can be priced as a derivative of BTC and time.

This thread will outline a new valuation model for #Bitcoin ASICs. 2/ Due to the commoditization of ASICs, the Bitcoin mining industry has experienced a tectonic shift when attempting to determine the market value of this hardware.

ASICs are no longer run for 6-12 months until they end up as e-waste.

1/ 2022 was a treacherous year for Bitcoin miners, but I'm hyper-bullish on the industry over the next ~ 10 years.

There are two key reasons why the Bitcoin mining industry is positioned to flourish. 2/

1. The world is in the early stages of actively monetizing BTC.

2. Energy production will become more efficient and cheaper.

1/ Many ETH talking heads have recently started attacking BTC’s “long term security model” as ETH has underperformed BTC since its “upgrade” to ultra-sound money ~ 4 months ago.

Ironically, it is ETH that has both a long term security and a long term value accrual problem. 2/ Bitcoin’s long term security is fine, as indicated by two of the top Bitcoin Mining companies in the world.

https://twitter.com/RiotBlockchain/status/1572257710216982529?s=20&t=cC3niSIEtoxV5fgsY_6mrQ

1/ Introducing Bitcoin Energy Gravity - a metric that models the relationship between the price of Bitcoin and its cost of production.

This can be used to identify when the price of Bitcoin is too overheated or when the price of Bitcoin is bottoming. 2/ All Bitcoins are acquired at one of two market prices: $ / BTC or watts / BTC. Both prices are increasing over time, but not necessarily at the same rate.

1/ A 🧵 for US Lawmakers regarding Bitcoin Mining.

Bitcoin is a superior monetary tool that is being bootstrapped, audited, and accounted by miners performing proof of work.

Banning mining would be worse than banning the internet in 1995. 2/ Bitcoin ASICs themselves emit zero greenhouse gases.

Miners are electric accountants (moving money) just like Tesla's are electric vehicles (moving people).

1/ In today's Blockware Intelligence Newsletter, I updated an estimated miner network distribution table.

This is critical data that can indicate locations of potential miner capitulations (historical price bottoms).

Here is the original table from March 2022. 2/ Here is the updated table assuming a BTC price of $28,000 and a hash price of $0.12.

1/ #Bitcoin is certainty in an uncertain world.

This thread contrasts the certainty of Bitcoin’s immutable scarcity with the macroeconomic uncertainty associated with record-high inflation. 2/ Bitcoin is different from all other assets (crypto and traditional) due to its unique property of immutable scarcity.

Unlike other commodities, Bitcoin has a predetermined algorithmic supply schedule that cannot be changed.

1/ As the macro landscape weighs on markets all over the world, many investors are flocking to safe-haven assets.

The Russian invasion of Ukraine, record-high inflation in the US, and a hawkish federal reserve have led to the price of Bitcoin falling from $69,000 to $38,000. 2/ While unconventional, new-generation mining rigs provide a unique opportunity for investors.

Because of the algorithmic supply dynamics in the #Bitcoin network (difficulty adj), new rigs enable miners to earn a consistent positive cash flow even in the face of volatility.

1/ Billions of dollars are demanding exposure to #Bitcoin mining.

The industry is growing rapidly, massive infrastructure is being built, and global 🌎 #Bitcoin adoption is not slowing down anytime soon.

Reviewed and edited by @blakedavis50 2/ Significant amounts of capital are currently flooding into public #Bitcoin mining companies. They are able to raise billions of dollars for two key reasons.

First, these are high-growth technology companies that actually spin-off a positive cash flow.

1/ Geopolitical #Bitcoin Mining is an interesting game where the only winning move is to embrace $BTC. 2/ #Bitcoin mining at the geopolitical stage is a massive Prisoner’s Dilemma with 195 different players (195 countries).

The general idea of geopolitical Bitcoin mining game theory is that if a country does decide to ban mining, they will lose.

1/ Public #Bitcoin miners raising billions of dollars in 2021 is the catalyst for Wall Street to question their skepticism towards $BTC.

Let me explain. 2/ It’s hard for Wall Street to deny that #Bitcoin mining is currently a financially attractive business.

Hence the number of miners tapping into public markets.

1/ We’re living in a #Bitcoin mining gold rush. Billions of dollars are flooding into the mining industry to capitalize on this massive opportunity to mine and HODL cheap coins.

Where will the total network hash rate be at the end of 2022? And what does this mean for miners? 2/ @glxyresearch released a fantastic mining report that included their hash rate projections for 2022.

Their end of year projection was 335 EH/s (+84% increase from the current 14d ma).

https://twitter.com/glxyresearch/status/1481265565578629121?s=20

1/ Last month I quit my “safe” technology consulting job to join @BlockwareTeam.

One reason I did this was because I believe the 2020s are setting up to be a profitable decade for #Bitcoin mining.

Let me explain why. 2/ Two simple ideas.

1. Price will continue to exponentially grow
2. Hash rate growth will continue to slow

1/ Few people understand the idea of #Bitcoin denominated exit liquidity.

With the current macro environment, exponentially growing government, and rapid embracement of MMT, USD denominated prices can go to ∞.

This DOES NOT mean they can be cashed in for their $BTC equivalent. 2/ The most obvious example of this is a stock like $AAPL.

Its market cap sits at $2.5T, which is roughly 41.8M $BTC. Of course if all apple shareholders decided to cash out to #Bitcoin today, they would not end up with 41.8M $BTC, as there are currently only 18.8M that exist.

#Bitcoin is money that cannot be diluted. Money is a call option on all future capital forever.

Post-hyperbitcoinization, the real return of bitcoin will be the equivalent of $SPY or a “diversified” portfolio.

99.9% of the world will have > 90% of their net worth in #Bitcoin. Just because most people just sit on their #Bitcoin, does NOT mean growth will slow.

Growth will drastically accelerate bc the market converging on HODLing bitcoin will increase its purchasing power until entrepreneurs see real alpha in the market.

1/ #Bitcoin is the first real money humans have ever discovered.

Its near perfect monetary properties combined with the immutable constant of 21 million coins will make its future value near astronomical 🚀.

$50M+ $BTC by 2040 is very reasonable. 2/ Lets recap what “money” is.

Money is an economic good. Humans have tried to use other goods as money in the past, but they are far from perfect.

Salt, shells, glass beads, Rai stones, gold, paper, and debt have all been tried to be used as money.

1/ #Bitcoin is the first REAL money society has ever discovered.

It is the catalyst towards near perfect price signals due to its strong, drastically underestimated, propensity to HODL (only 21M). 2/ You can do 2 things with #Bitcoin.

1. Invest it (to earn more $BTC).
2. Spend it (to consume today).

1/ #Bitcoin is the best form of money ever discovered by humans.

This thread will recap why this is the case and what incentivizes people to "save" or HODL. 2/ #Bitcoin is an asset that has 2 unique characteristics.

1. No counter-party risk (no reliance on government, corporations, or any group of people)
2. No dilution risk (21M coins max)

1/ INSIDE THE EVENT HORIZON with @MimesisCapital

THREAD #15

bitcoinmagazine.com/markets/why-is… 2/ A common “knock” on Bitcoin is that it is “too volatile”.

However, volatility isn’t necessarily a bad thing. In fact, volatility creates opportunity.