so much to say, go get a degree in Economics and it will make so much sense. Fractional reserve is (was—thanks COVID) one of the longest standing scams of the financial system. It used to be that banks needed to have 10% of capital (in the form of what it’s customers had in bank SAVINGS accounts) to every loan they write. So to give a customer a $300k home loan, the bank needs to have $30k in customers savings accounts to secure that loan. Now the bank lets say gets 4% interest on that loan—what cut do they give the customer in the form of their savings yield. A fraction of 1 fucking percent. You can get a money market account or a savings account thru your credit card company they might pay you 2.3% (literally the rate of inflation), so they can loan credit at 22%. It’s a huge scam, and people have been so brainwashed to believe they are making any amount of yield in savings accounts.
remember when I said fractional reserve USED to be biggest scam? Still is, but because of the COVID financial crisis, they literally eliminated the 10% capital requirement. Banks can now loan as much money as they want.
Bitcoin may be volatile, but if you have the timeframe of 3-4 years, it will appreciate in value because of a supply halvening built in where the miner block reward gets cut in half every 4 years. That’s all nerd talk you dont have to understand how the blockchain algorithm works, but understand that cash saved up literally loses value year over year. That’s why cash flush companies like Tesla are anchoring bitcoin into their cash positions.
and then there’s DeFi. No credit scores, nothing. You collateralize your bitcoin, get a loan through the smart contract, and get your bitcoin back when you pay off the loan. There is no bank—the people who provide the cash/tether or whatever token for the lian, get the interest that you pay. It literally eliminates the bank and gives us control of our money.
Every butt-coiner wants to believe that Bitcoin is fake money backed by nothing, not realizing pot calling kettle black as globally currencies are being created out of thin air to prop up the markets, even as interest rates are so low they’re literally negative in some countries including even US treasuries now. F’d. Bitcoin is only backed by—oh the entire world minus India, The United States is the stubborn 80 year old, go to Asia and tell us how imaginary it is...
if you get it, it will make so much sense and be a no brainer.
-emile-explain bitcoin to me.