#443: Q2 2023 Monetary Base Update with Matthew Mežinskis
Aug 30, 2023
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Matthew Mežinskis, an expert in monetary base, provides updates on Q2 2023. Topics discussed include eNaira and CBDCs, top 5 currencies, compound annual growth rate, FHLB exposure, inflation impact, Bitcoin chart, Scandinavian physical currency, US federal debt, nations using Bitcoin and BRICS gold, and optimal outcome.
Analyzing the monetary base trend line indicates a potential mean reversion and a long-term outlook of a $1.3 billion Bitcoin price by December 2030.
The global monetary base analysis highlights the continued importance of physical cash, with an annual growth rate of 10.5%, despite efforts to transition to CBDCs.
Examining the monetary base and inflation reveals the potential consequences of central bank policies, affecting purchasing power and emphasizing the need for alternative stores of value like Bitcoin.
Bitcoin trend lines, including the black power trend line, predict a Bitcoin price of $55,800 by August 2023, providing insights into its performance and potential future movements.
Deep dives
Trends in the Monetary Base and Bitcoin Price
The analysis of the monetary base trend line shows a consistent increase over time, with potential mean reversion. The power trend line indicates a possible Bitcoin price of $1.3 billion by December 2030, providing an interesting long-term outlook for Bitcoin.
The Importance of Physical Cash in the Global Economy
The analysis of the global monetary base highlights the significant role of physical cash in the economy. Despite efforts to transition to CBDCs, physical cash remains an essential form of money for billions of people, with an annual growth rate of 10.5%.
The Implications of Central Bank Policies
The discussion on the monetary base and inflation highlights the potential consequences of central bank policies. With an annual increase of 13%, the expanding money supply affects purchasing power and necessitates alternative methods of preserving value, such as Bitcoin.
Bitcoin's Trend Lines and Future Predictions
Examining Bitcoin's trend lines reveals the potential trajectory of its price. The black power trend line, which dates back to 2016, predicts a Bitcoin price of $55,800 as of August 2023. Additional trend lines indicate possible future movements and suggest ways to interpret Bitcoin's performance.
The Challenges of a New Gold Standard
The idea of a new gold standard, as discussed by the speakers, presents significant challenges. The mixture of autocratic, communist, and monarchical regimes within the BRICS countries makes it difficult to coordinate and maintain a unified approach. Custody, settlement, and auditing of gold and other assets would pose logistical and trust issues. Historical lessons from the World War II era illustrate the potential for centralized gold reserves to be seized and used for nefarious purposes. The speakers emphasize the need for a decentralized and neutral alternative, like Bitcoin, which provides stateless protection and resilience.
The Potential of Lightning Network for Adoption
The Lightning Network holds promise for optimal Bitcoin adoption. The speakers highlight the importance of creating favorable adoption conditions that encourage individuals to hold Bitcoin in their own hands. They see Lightning's potential to enable unique and improved user experiences that are impossible in traditional financial systems. By focusing on scalability and the development of lightning-enabled solutions, they believe that Lightning can create a tipping point where people are compelled to adopt Bitcoin due to its functional advantages and utility.
Building Easy-to-Use Bitcoin Utility
To drive adoption, the speakers stress the need for user-friendly and intuitive interfaces that make Bitcoin utility accessible to the average person. They urge developers and businesses to build easy-to-use experiences that provide the necessary functionality without burdening users with complex technicalities. By simplifying interaction with the Lightning Network and offering unique use cases that surpass traditional systems, Bitcoin can gain widespread acceptance and distribution.
