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Bitcoin & The World in 2022
The Bitcoin macro strategy to prosperity. Water, energy, and communication independence. & the return to normal in 2022.
Happy new year everyone! 2021 was... bizarre. And yet, I can't complain. Bitcoin made new all-time highs and continues to consolidate, giving me growing confidence that the era of multi-year bear markets might actually be behind us. El Salvador's Bitcoin adoption while complex and messy remains one of the biggest stories of 2021. A source of fascination for anyone interested in Bitcoin, finance, politics, geopolitics and culture for that matter.
The American political system continued to spiral out of control and Latino America suffered the consequences of the globalist world economy, getting choked by the new covidian pharma-fascistic order. Supply chain shocks, too much fiat demand, fear by the pound on every news channel and rising prices marked 2021. The Afghanistan ordeal was... such a disaster it clearly marks an end to the US's global hegemony. America is currently a descending power and the lost confidence in US competence will enable new freedoms and opportunities for those open to them, as well as dangers that were previously kept at bay.
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So what should we expect for Bitcoin in 2022?
Bitcoin will likely continue to consolidate well into Q1, possibly Q2 of this year. I like to avoid making price predictions but when I do I err on the side of conservatism. Let's have a quick look at the Bitcoin price chart on a weekly scale to see what it says.
The red line is the 52-week moving average. The green line is the 200-week moving average. Both of these give us a sense of where the price trends are going and where hard support may be.
Many people are bearish during corrections and bullish when the price goes up. I tend to avoid that mentality. This to me looks like consolidation. I doubt we will cross below 30k USD this year, if we do cross it, we probably won't stay below it for long. In part because Bitcoin sub 30k would be such a good deal in the context of a 68k all-time high, that FOMO would kick in.
Gold is not what it used to be. We are the new gold now. :)
Bitcoin is also no longer the low liquidity, high speculation asset it once was, it is growing up into its adult stage and the big money is accumulating and splashing around. Volatility will continue but will also soften, as time frames become greater and movements slower than they were in its previous 10 years.
My expectation for Bitcoin is consolidation well into spring, with a possible run-up and attempt at the all-time high towards the summer.
My confidence in Bitcoin in these times of chaos and the flood of fiat that continues to come have not changed. Bitcoin is a safe haven asset and anyone that knows anything about investment and economics should at least have some.
We are impossible to ignore now.
More on how to play the Bitcoin game in the foreseeable future towards the end of this article.
The only real danger to Bitcoin's price continuing to do what it has always done would be a return to sanity by our political elite, a sane rise in interest rates, and the emergence of sound political leadership.
All of which frankly seem laughable and far-fetched. If they happened, they would be good for the world but probably hard to maintain in the short to mid-term. Too much of the world has to change for such a status quo to be formed for now, in my opinion.
What should we expect for the world in 2022?
There's some good news here, though tentative. The covidian hysteria is losing steam. I see it among my normie friends and family. I see it when I talk to uber drivers. I see it in the analysis of other thinkers I follow and what they report.
The general public took two vaccines, for the most part, the third smells funny and the rubber band of political compliance might finally snap, after two long years of madness. The authoritarian power lust of the political classes in Australia, Canada and Europe is on full display and if democracy has any influence left in our societies, these politicians will be punished at the ballot box in the coming years. Mid-term elections are next for the US and despite its chaos, the United States continues to lead culture and policy worldwide throughout the western world.
What the US does, most political hacks, bureaucrats and corporate media propagandists parrot, it is fascinating to watch. And my sense of this neurotic government response to covid is that it has clearly been overplayed.
The economic consequences are visible to most people that don't travel via helicopter and thus their narratives are now on the defensive. Let's hope this continues and let's hope a return to normal follows. A return to normal, either way, is what we must pursue. Hope for the best, plan for the worst.The intentions of the technocrats are clear. They want full control over society's infrastructure and norms. They want to become gatekeepers to culture and the fruits of society. They succeeded to a disturbing degree over the past two years, but I suspect their power is unstable. These mandates and lockdowns are simply too absurd, their narrative is collapsing. Vaccines are not delivering the normies back to the normal they remember and the normies are getting pissed off. Finally some good news.
Yet the price distortions that this command and control economic order have created will continue. You can't just shut down the economy while everyone cowards in fear in their homes, and expect things to be fine. We will be dealing with the consequences of this global madness for years to come. And there is great hope for those that recognize the change in trends.
So how do we survive and thrive in the 2020's?
A return to normal is in order. But it will have to be different in various fundamental ways. A return to normal will have to be a return to independence. A return to peace among our neighbors and localist culture and politics.
Many Bitcoiners seem to think that land is a scam. If you are among this group let me tell you, my friend, you are a lost metropolitan child. You can not eat a Bitcoin.
Unless you fear imminent capture of real estate and a full collapse of your society, then land remains a source of power and sovereignty. It will give your family the freedom to grow, and you the freedom to eat and drink regardless of the madness of politicians miles away.
First, we must develop water independence. If you can pull it out of the ground, or collect it from the clouds, do that. Filter it. Own it. Whatever it takes to do so, it will give you and your family the strength to push back on the overreaches of the world.
Then we must work towards household energy independence. This is not easy or cheap of course. But if you play your cards right, it can probably be done. Solar power is advancing and we might as well take advantage of it while we have access to it.
Whatever we can do to move towards that ideal, the better. If this kind of independence is something you value and crave, then you probably have noticed we are not alone. Home sovereignty is a major trend that you won't hear about on the news. This is how we return to normal.
Communications independence would be next and here, there's great potential, and a lot of work to be done. We can have our own servers, our own blogs. We can proxy all our search queries, build out our own newsletters and download our contacts. We must keep the directory of our networks in our own hands.
I recently got put in twatter jail for talking about medicine known to treat the covaids. Fuckers have lost the thread. That platform is no longer a place for truth to power or discourse. To whatever degree it ever was, that era is gone.
I will not let them ban me, I will simply disengage, to keep my account as long as I can and retain my network and digitized reputation as is. The same for Facebook. We must pull our network out and build outside of the reach of the technocrats.
I don't know a whole lo
That's the new wave.
Finally food independence. This is the final battleground. They want you malnourished, so you can't think clearly, so you can't compete. So you will do as you are told. Do not grant them this power. It might well be the last one they need to take. I don't know how, it is easier said than done. But I see the ideal.
We need to defend the meat industry, especially locally to us. We need to walk the talk and support natural foods and organic markets. We need to stop eating the crap they produce and get strong. The only way to return to normal now is to survive the madness and thrive through it. To rebuild the foundations of freedom that brought us the fruits of prosperity, luxury and the arts. The sooner we get that done, the sooner we return.
As for society, a new idea is emerging. The networked state. That of an internet-era society, networked among individuals worldwide. While the idea is still raw, its value proposition is simple. Don't lose connection with your peers, but leverage them. Strengthen those connections and build locally.
Many people think " I'll just move where I'm treated best", this works in some contexts. But migration is a mixed bag. I have lived it all my life. Its consequences are so disruptive that I would have to write a whole article about it. Even if you can do it, most people can't and won't. And even if you can, building locally with a global network will still be the best way to manifest the life and world you want to live in. Fuck the metaverse, it's a massive circle jerk and mind control play. Let's return to our humanity. And use technology to our ends, instead of letting it use us.
So how are we supposed to fund all this sovereignty?
Well, Bitcoin of course. Here's the trick. Selling your Bitcoin to buy things is looking like a thing of the past. A new strategy is emerging a ... Macro strategy if you will.
The path that Michael Saylor is laying out I have to admit has blown my mind. While I'm still wrapping my head around it and figuring out how to integrate it into my life, I am now firmly gripped by this idea. The idea is simple. As long as governments can exist, money will be divided into two things, fiat currency and Bitcoin. Bitcoin a savings account that can not be inflated and thus preserves the true value of your money over time. Currency, the fiat accounting rails of the modern world and the blood of the state.
We are probably 30 to 50 years away from Bitcoin becoming a truly mainstream unit of account. Or so it seems if you believe Saylor when he says it's near impossible to upgrade the world economy's accounting standards to Bitcoin. He says you could offer Cocacola 10 trillion dollars or a bullet to the head to change their accounting system and they would probably prefer death, lol.
I don't know a whole lot about the accounting of corporations but I do know that governments are not gonna let go of their fiat powers without a fight. He is also quite right about that.
We never the less must continue to build towards a Bitcoin monetary standard. I do believe we can achieve it, I have lived it. However, in the coming decade or two, it's just not realistic. El Salvador is a very unique example without a local currency. Most of the world's fiat currencies would have to lose total confidence before Bitcoin can really become their new norm. It will happen gradually yes. And yes we should continue to develop Bitcoin's lightning network and scaling technologies. But it is foolish to ignore the power and interests of the state, especially over the economically wealthy and productive. Saylor points out a powerful path forward in the meanwhile. Keep in mind, this is definitely not investment advice, I'm just grasping this whole thing, but I'm becoming a believer. Keep all your Bitcoin and instead acquire fiat debt. Fiat will continue to lose purchasing power, thus your fiat debt (if it's not predatory) will simply continue to shrink. Meanwhile, your Bitcoin will continue to grow in purchasing power. And the cherry on top? You don't have to pay capital gains on your BTC cuz you won't be selling it! Ideally, for this to work, you can collateralize some of your Bitcoin and get fiat credit with BTC as its base. Like what UnchainedCapital does in the USA. And use that to pay the interest rates of your loans.
This is a brilliant strategy, it is breathtaking. I finally feel like I have an answer to the taxation problem without naive science fiction-grade dreams of massive cultural and societal change.
You never sell your Bitcoin
You get long term fiat loans
Bitcoin grows faster than the interest on your loans
You find a way to collateralize your Bitcoin and get fiat credit, especially during consolidation like right now. You use that to pay the interest on your loans.
If you have a house, maybe you take out a long-term mortgage on it and buy Bitcoin with it. Why not? Bitcoin grows like 30% a year on average. Much more than most interest rates.
Worst case scenario, you sell some Bitcoin to pay off the interest rates.
Now let me make this clear, this is advanced stuff, that requires very conservative risk management. You should probably not get loans greater than 40% of your Bitcoin hold's fiat value. You should also avoid Bitcoin collateralized loans that have a hard liquidation clause. Like doing a leveraged long trade on an exchange. Because bugs and glitches can take you out. Finally, you should take out Bitcoin-backed fiat loans during consolidation and dips. Not during all-time highs. Because corrections will make it hurt, while bull runs will be all sunshine and rainbows. You should also not attempt this with shitcoins. Bitcoin is volatile enough as it is.
But think about it. If you can get fiat credit at an interest rate lower than Bitcoin's average growth. Then. well. You are kind of getting free money. Just keep rolling the debt. There's an incredible future and potential here. Even lightning wallets can adopt this model. Using Bitcoin as a savings account that can be collateralized to get fiat stable coins. Those fiat stable coins moving a light speed through the lightning network. Keeping the taxman at bay.
I love it, if you find this fascinating, go check out Michael Saylor's conversation with Peter Mccormack. It's a whole new level. I think. What do you think? I have comments enabled below, you can log in with your twatter account.So let me know how wrong I am or w,e, :)
As usual, this blog post is gigantic, so I'll leave it at that. Cheers!
Deep Thoughts W/ Juan Galt is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.