Update on #Bitcoin #ETF #inflows and available supply.   Since the launch of the Spot Bitcoin ETFs in January 2024, these instruments have been buying significant amounts of Bitcoin. What is their trend and how does it impact the overall sector?   The approval of the Spot Bitcoin ETF from the #SEC has been a major step forward for global bitcoin adoption and recognition in the traditional financial world. Big #institutional #investors including pension funds, sovereign wealth funds, banks and insurance companies, to name some, were prohibited by their mandates to own bitcoin directly and were therefore excluded to participate in this asset class.   Grayscale Bitcoin Trust ($GBTC), with over 660,000 bitcoin, was the only product available to institutions before the spot ETF was approved but it suffered significant problems due to the redeemability mechanism of the shares and its related premium/discount on NAV. With the ETF approved, $GBTC was converted into an ETF and decided to keep its management fees at 1.5% of AuM, significantly higher compared to all other ETF issuers.   In the first weeks of trading, $GBTC outflows have been compensating total inflows from other participants ($IBIT of BlackRock, $FBTC of Fidelity or $ARKB of Ark Investments), as their fees were 3x to 4x higher than the other issuers. Such outflows, in the range of $350mln to $640mln a day, where offsetting most of the demand from other players and as such, ETF buying activity had a close-to-zero impact on bitcoin available supply.   However, since last week, outflows from $GBTC have slowed and are in the range of $70mln to $100mln a day. Current demand from the other nine issuers is strong and in the range of approx. $500mln a day, translating in a total demand of ca. 10,000 bitcoin a day, or 11x the current daily issuance of 900 bitcoin.   Considering that available bitcoin on exchanges is approx. 1.9 million (Coinglass) and that in two months the #halving would cut daily supply issuance to 450 btc, if demand from ETFs stays flat at ca. $500mln a day, the total bitcoin supply could fall to zero in 182 days!   I am no great fan of Bitcoin ETFs due to the shortcomings related to which instrument you are actually buying, instead of having direct access to the perfect bearer-asset in history. ETFs brings significant centralization issues to the table by keeping the underlying bitcoin in custody at crypto exchanges and TradFi institutions – while the whole purpose of bitcoin should be to eliminate intermediaries.   I am hopeful, however, that with the rise in price of bitcoin caused by more demand chasing an ever shrinking supply, people will spend more time and attention to understand the type of asset they own, to then eventually sell their ETF shares to buy and self-custody the underlying! #Bitcoin #BitcoinSpotETF #SpotETF #inflows #GBTC #IBIT #FBTC #ARKB #supplydemand

#Circular #economies based on #Bitcoin   After 15 years from its creation, people in the world which have an understanding of Bitcoin or have used it so far are still far below 10% of the global population. Many still don’t know, or better, don’t mind knowing, that the problems society is currently facing are brought by #broken #money. By not understanding the concept of money, people don’t feel the need to acknowledge Bitcoin and its value proposition.   Things are running decently smooth in the Western world, people have good ways to transfer money nationally for goods and services and Bitcoin is used by few as a saving vehicle, to keep some assets outside of the system. But in other parts of the world Bitcoin is used primarily as a medium of exchange for daily payments.   Despite #adoption rates are still low globally, the number of local bitcoin communities is steadily growing and it’s allowing the creation of circular economies.   In Central America, the case of @BitcoinBeach in El Salvador can be considered as the first attempt of people to use bitcoin for payments. Considering the high level of unbanked in the country, bitcoin and the #lightning network represent a way to allow the exchange of value for goods and services at high speed and very low cost. Needing only a phone and internet connection, bitcoin allows for inclusion to everyone, close to zero onboarding process and no need for a credit history.   In Uvita, Costa Rica, @BitcoinJungleCR is doing a similar job and is focusing on educating people about the benefits of bitcoin and the personal empowerment it allows. Many merchants are accepting bitcoin as payment and local bitcoin meetups are organized frequently.   In Lake Atitlan, Guatemala, @BitcoinLake and @Lakebitcoin are trying to teach merchants about bitcoin on onboard them on the lightning network. Hostels, restaurants, shops and tuk-tuk drivers are accepting Bitcoin for payment.   In South America, @BitcoinBeachBR is working on adoption in Jericoacoara, Brazil. Many merchants have embraced bitcoin and use Bitcoinize pos terminals to present bills to their customers and receive direct payments to their business wallets.   In South Africa, @BitcoinEkasi is training kids to surf and is educating them on the powers of a #decentralized money network, outside the reach of the state. Ghana has organized the first bitcoin conference in Africa and many local and international bitcoiners have gathered to understand the adoption and #innovation happening in Africa.   In Boracay, Philippines, and Danang, Vietnam, @BitcoinBeachPH and @BitcoinBeachVN are trying to follow El Salvador’s example and build a circular economy based on bitcoin. Neutronpay is used to onboard people on lightning.   The trend is clear and with #halving and institutional adoption coming in Bitcoin in 2024, I believe we will see the development of many more communities like these ones, as well as significant growth in the existing ones.

Why can #Bitcoin #blockspace be considered as a #commodity?   Understanding the implications of blockspace in Bitcoin is a crucial element to understand Bitcoin itself. Satoshi created Bitcoin in 2009 with a limited blockspace of 1 megabyte (MB). This choice was probably taken to prevent spam transactions and ensure the stability of the network during its early stages.   Such limit did not allow more than 2,000 to 3,000 transactions, depending on their size, per block. When Bitcoin was not known to many this limit was working well, but as its popularity started to grow, more transactions needed to be included in each block, driving transaction fees higher and creating network congestion.   Blockspace increasingly became a topic of debate within the Bitcoin community, where some argued that increasing the block size would allow more transactions per block, lowering fees and eliminating congestion.   But increasing the block size has significant implications for the #decentralization and #security of the network, considering the higher amount of MB that each block would weight on the #blockchain. Its consequences on the costs of the infrastructure would price out normal people from running #nodes and keep an entire version of the #ledger in their PCs, leaving the exclusivity to secure the network and validate blocks to small elites and corporations.   The #Blocksize #war of 2017 has occurred exactly for this reason, where some developers ultimately came to propose a #hard #fork of the Bitcoin blockchain to increase block size to 8 MB, without having much success.   Different upgrades made to the Bitcoin network such as #SegWit and #Taproot helped the Bitcoin network to improve transaction privacy, security and scalability without touching the initial block size limit hardcoded by Satoshi on the network.   If we think of Bitcoin as a global settlement network for billion $$ transactions, the #scarcity and #utility of block space as a commodity becomes quite clear. Just as #oil is used for #energy or #gold is used for jewelry and investment, blockspace is essential to inscribe valuable, immutable transactions in the blockchain.   Miners tend to prioritize transactions with higher fees, creating a market for blockspace where users compete to have their transactions included in the next block. Such fees represent the value that users pose on having their transactions confirmed quickly and securely on a censorship-resistant network.   Transaction fees can therefore be considered as the price for such a commodity, being captures by #miners for the work done in keeping the Bitcoin network secure.

Starting the read of the newly arrived 🤩 #brokenmoney @Lyn Alden

Yesterday I went to the barber and managed to #orangepill him! He downloaded #Muun wallet and accepted a lightning payment 🟠💊⚡️ #bitcoin #lightning

Finally bought the ticket for my first #bitcoin conference - going to Amsterdam in October! Who will be there and is willing to connect? #bitcoinamsterdam2023

Finally I took action and decided to cancel my useless #facebook account today. I want to connect solely with #bitcoiners on #Nostr

What is the best advice you would give to a TradFi worker to move into a bitcoin-only company?