The Golden Fork

We have been dining out on a Bitcoin bull market. Crypto currencies are consolidating and the stock market is in decline. What was once a scary proposition, the hard fork, is now revealing itself as something else. The golden fork.

Anyone who had bitcoin a month ago now owns Bitcoin (worth $4200 at the time of writing) and Bitcoin Cash (worth $700) SO That's a gain. a win win, in fact, something to look forward to.

Now we have a potential third fork on the horizon with the second half of the Segwit2x agreement, the 2x part. I think that this will actually ramp the price of Bitcoin up.

Due to the relative success of Bitcoin Cash (also called BCash, BCC, BCH) the forking phenomenon could well also become a greater trend. Exacerbating the benefits from getting into Bitcoin early.

We will be creating a triple star formation. I previously illustrated a binary star analogy to describe the working of the blockchain into user and miners threads. The third star will be for Bitcoin industry companies. This dilutes the counter balance of and I think reduces the threat to the user blockchain

It is a bright future for Bitcoin. Etherium ICO frenzies are taking a step back. The new crypto bull market might be on the fork.

What If China Stops Renewing US Bonds and Buys Bitcoin?

China has over 1 trillion USD in United States government treasuries. Currently the most in the world. What if China decided it didn't want to hold them anymore.

As an exporting country this could be difficult as repatriating the USD to Yuan would put the price of the Yuan up which in turn would stifle exports, but what if instead of this it simply bought Bitcoin with the USD.

The price of Bitcoin in USD would go up. This would make it hard for US citizens to get buy bitcoin. China's Bitcoin stash could then be used for its general public in the international markets.

This would be a major conspiracy, but if it should happen, the Bitcoin price should be at least 16.4 times what it is today just based on market cap. That's a price of at least $69371 USD.  This is the next moon  What if any other countries should follow? there are significant inc incentives for countries to do this.

Bitcoin Proliferation is also great for American Macro Economics

There was a few months this year where, for the first time in recent history the bitcoin price in USD was leading the market. This has been rare, in the past the Chinese have seemed to be much faster to get exited about spikes in the bitcoin price,

IN February I was planning to write this post and had just finished a post about how good bitcoin is for Chinese macro. Time has flown by, but the story of how bitcoin can actually be good for the USA, as a government, has actually become more clear. Legislation and media are even getting behind it.

The idea behind why its good is pretty basic. Although this is Pluto like speculation, why not bullet point it;

• The USA has a lot of debt to foreign countries in USD.
• The strong USD doesn't really help the US industrial exports especially that lead to trade deficits.
• Other countries hold large reserves in USD which give them some leverage over the country (China's 3 Trillion odd USD in bonds, Switzerland's giant US stock stash) 
• The average American also has plenty of personal debt.
• Money printing and inflation can be used and abused in the transition period

So.... Why not just forget about that old money and just start a fresh?

Some people might logically think it could be the best thing you could do . The benefits could be;

• No more national debt
• Good exports with minimal disruption, leading to more jobs
• No leverage from foreign powers
• Reduce the average Americans debt
• The whole thing happened because some anonymous internet money that is totally decentralised and we obviously couldn't have seen coming, "sorry creditors, it's not our fault"
• the government can get itself out of a difficult fiscal and macro economic position, without the hard sacrifices that might normally be needed. 
• USA would be a first mover on what could become the new world reserve currency

I'm not saying that this is going to happen, but I am laying down the logic. It's not all bad.

The next blog on macro will be about when a smaller country might approach a tipping point.