$64k Bitcoin Transaction For A 9MB Data Inscription

$64k Bitcoin Transaction For A 9MB Data Inscription

In a puzzling move, an unidentified individual has spent approximately $64,000 to record nearly 9 megabytes of encrypted data on the Bitcoin blockchain. Spanning over 332 transactions, with fees varying from $14 to $2,500 in Bitcoin’s smallest unit, satoshis, the purpose behind this enigmatic activity remains shrouded in mystery.

Recently, someone spent around $64,000 (about 1.5 BTC) to add almost 9 megabytes of complex computer data to the Bitcoin network. 

The mystery of the 2024 Bitcoin data inscription

A report from Ord.io, a digital data tracker, revealed that over 1 Bitcoin was used to make 332 separate entries on January 6th. 

These entries contain complex data. But right now, no one knows what this data means. 

Someone even tried to figure it out using ChatGPT, a smart computer program, but they couldn’t solve the mystery.

As you can imagine, there is a lot of curiosity about who actually added this data. 

The Bitcoin address linked to these mysterious additions is listed as “Unnamed” on Ord.io. The data itself is a mix of English, Greek, and mathematical symbols. 

Interestingly, among the 332 entries, two feature a digital image of a pepperoni pizza. 

According to Ord.io, this signifies that the entries include some of the 10,000 Bitcoins once used by early Bitcoin enthusiast Laszlo Hanyecz to buy two Papa John’s pepperoni pizzas on May 22, 2010. 

This puzzling event of inscribing data occurred just a day after a massive 26.9 Bitcoins, valued at $1.17 million, were transferred to the very first Bitcoin wallet, known as the Genesis wallet, on January 5. 

What is Bitcoin blockchain inscription?

Imagine the Bitcoin blockchain as a digital ledger or a record book.

Normally, this ledger keeps track of Bitcoin transactions – who sends and who receives Bitcoins.

An inscription on the Bitcoin blockchain is like writing a note in the margins of this ledger. Instead of recording a transaction, you’re adding extra information.

How is it different from typical transactions?

A standard Bitcoin transaction is like saying, “I give 5 Bitcoins to Alice.”

An inscription adds more: “I give 5 Bitcoins to Alice. P.S. Here’s a recipe for apple pie.” This ‘recipe’ is the extra data you’re inscribing.

This extra data doesn’t affect the transaction’s main purpose (sending Bitcoins), but it permanently records additional information.

Why inscribe data on the blockchain?

  • Permanence. Once something is written on the Bitcoin blockchain, it can’t be changed or deleted. It’s like carving into stone.
  • Visibility. Everyone who can see the ledger can see your inscription. It’s a public display.
  • Proof of existence. Inscribing data can prove that a certain piece of information existed at a certain time. For instance, if you inscribe a unique digital artwork, you’re showing that it existed at the time of the inscription.
  • Security. The blockchain’s secure nature makes it a trustworthy place to store important data.

The process of a Bitcoin blockchain inscription

  • You create a Bitcoin transaction.
  • Along with the transaction details (like sender, receiver, and amount), you include your extra piece of information – your ‘note.’
  • You send this transaction to the blockchain.
  • Miners on the Bitcoin network confirm the transaction and add it to a block.
  • Once added to a block, your inscription is permanent and visible to anyone who looks at the blockchain.

26.917 BTC transaction to Genesis Wallet

On January 5, at 1:52 am Eastern Time, an anonymous Bitcoin user made a notable transaction, sending 26.917 Bitcoins, valued at $1.17 million, to Bitcoin’s first-ever wallet, the genesis wallet (1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa). 

$64k Bitcoin Transaction For A 9MB Data Inscription. 26.917 BTC transaction to Genesis Wallet

Source: Blockchain.com

This wallet is historically significant, as it was set up by Satoshi Nakamoto, the elusive creator of Bitcoin.

The transaction was unique for several reasons. 

Firstly, the amount was transferred from a wallet that had been emptied specifically for this purpose. The transaction fee was $100, which is considerably higher than the average fee. 

Secondly, the funds were moved in a complex manner, involving three wallets initially and then dispersing to 12 others. 

Notably, a large portion of these funds was traced back to a wallet associated with Binance, a major cryptocurrency exchange, as identified by Arkham Intelligence, a blockchain analytics platform.

Coinbase director Conor Grogan commented on the transaction, speculating on two possibilities: either this was an action taken by Nakamoto himself, moving Bitcoins from Binance, or it was someone else making a dramatic gesture by effectively ‘burning’ over $1 million. Grogan also raised the possibility of this being part of an unusual Bitcoin exchange-traded fund marketing campaign.

It’s important to note that there has been no movement of funds from wallets associated with Nakamoto, including the genesis wallet, since Nakamoto’s disappearance in December 2010. 

However, it’s speculated that Nakamoto could still possess the private keys to these wallets and control the funds within.

The genesis wallet initially contained 50 Bitcoins mined by Nakamoto. 

By the end of 2023, on the occasion of Bitcoin’s 14th birthday, the global Bitcoin community had added to this wallet’s balance, bringing it up to 72 Bitcoins through various celebratory contributions. 

26.917 BTC transaction to Genesis Wallet

Source: Blockchain.com

With this latest transaction, the wallet’s balance has now reached 99.68 Bitcoins, which are estimated to be worth about $4.69 million.

Bitcoin ETFs: A Beginner’s Guide to Crypto Exchange-Traded Funds

Bitcoin ETFs: A Beginner’s Guide to Crypto Exchange-Traded Funds

Bitcoin ETFs are the intersection where cryptocurrencies meet the structured universe of traditional investing. 

Bitcoin ETFs, or ‘exchange-traded funds’ that focus on Bitcoin, offer a unique way to participate in the exciting growth potential of cryptocurrencies without diving headfirst into the often complex crypto markets. 

These ‘crypto ETFs’ blend the familiarity of conventional stock trading with the adventurous spirit of digital currencies, providing a gateway for both seasoned investors and curious newcomers. 

As we explore this innovative investment vehicle, you’ll discover how it simplifies the process of adding digital assets to your portfolio, all while maintaining the ease and accessibility of traditional stock market trading. Let’s dive in and unravel the essentials of Bitcoin ETFs.

What are exchange-traded funds (ETFs)?

Imagine you want to invest in the stock market, but instead of picking individual stocks (like shares of Apple or Google), you decide to buy a little bit of lots of different stocks all at once. That’s essentially what an Exchange-Traded Fund (ETF) is.

An ETF is like a basket that contains a mix of various stocks, bonds, or other assets. When you buy a share of an ETF, you’re buying a small piece of all the things inside that basket. This mix can include all sorts of investments – from tech companies to government bonds. The beauty of ETFs is that with just one purchase, you can invest in a whole range of assets, which can reduce the risk compared to buying just one company’s stock.

What makes ETFs special is that they are traded on the stock exchange, just like regular stocks. This means you can buy and sell shares of an ETF throughout the day at different prices, just like you would with stocks of individual companies.

So, in a nutshell, ETFs offer a simple way to diversify your investments, spreading out your risk while still allowing you the flexibility to buy and sell as you would with traditional stocks.

Why is everyone talking about a spot Bitcoin ETFs?

The sudden importance of spot Bitcoin ETFs in the crypto world stems from their potential regulatory approval, a significant step forward in legitimizing Bitcoin as a mainstream investment. 

Unlike previous ETFs tied to Bitcoin futures, spot Bitcoin ETFs would be directly linked to the current price of Bitcoin, offering a more direct and potentially more accurate reflection of Bitcoin’s market value. This direct connection attracts investors looking for a more straightforward way to invest in Bitcoin through traditional financial structures.

The anticipation of these ETFs has been heightened by the involvement of major asset management firms like BlackRock, Fidelity, and VanEck, signalling strong institutional interest. 

The approval of spot Bitcoin ETFs by the SEC would not only increase Bitcoin’s accessibility to a broader range of investors but also potentially provide more stability and liquidity in the crypto market. 

This move is seen as a critical milestone for the cryptocurrency industry, as it represents a significant endorsement from regulatory authorities and could lead to increased adoption and integration of Bitcoin into the traditional financial system.

The benefits of Bitcoin ETFs

Bitcoin ETFs are an exciting option for those interested in the buzz of the cryptocurrency world but looking for something a bit more familiar and potentially less risky. Let’s break down why someone might lean towards a Bitcoin ETF instead of buying Bitcoin directly.

Familiarity and Ease of Trading

Investing in a Bitcoin ETF feels much like investing in any other stock. You don’t need to learn the ins and outs of cryptocurrency exchanges or how to securely store digital coins. It’s as straightforward as trading regular stocks, making it a comfortable option for many traditional investors.

Diversification

Bitcoin ETFs often track not just the price of Bitcoin but can include other cryptocurrencies or related assets. This means you’re not putting all your eggs in one basket (Bitcoin) but spreading your risk across a range of assets. It’s like choosing a mixed fruit basket over just apples. This diversification can be a safer bet, especially in the volatile world of cryptocurrencies.

Regulatory oversight

ETFs are subject to regulatory oversight, which means there’s an added layer of security and transparency. When you buy Bitcoin directly, you’re stepping into a largely unregulated space, which can be riskier. With a Bitcoin ETF, you have the peace of mind that comes with regulated financial products.

Lower entry point

Investing in Bitcoin directly can be expensive, as you often have to buy whole units of the cryptocurrency. But with a Bitcoin ETF, you can invest with much smaller amounts, making it more accessible for the average investor.

No digital wallets are needed

Holding Bitcoin directly means dealing with digital wallets and the security concerns that come with them. 

With a Bitcoin ETF, you don’t have to worry about digital wallet security or remembering complex passwords. Your investment is as safe as any other stock in your portfolio.

Top Bitcoin ETFs to invest in

When it comes to dipping your toes into the world of Bitcoin through ETFs, there are several key players you might want to consider. Here’s a list of some of the top Bitcoin ETFs, each offering a unique crypto-investing approach.

ProShares Bitcoin ETF

ProShares is a big name in the ETF world, and their Bitcoin ETF is a popular choice. It’s known for its reliability and is a go-to option for many investors looking to get involved in Bitcoin through a more traditional investment vehicle.

Grayscale Bitcoin Trust

While not a traditional ETF, Grayscale’s Bitcoin Trust is another major player. It offers exposure to Bitcoin’s price movements without the need to directly buy and store the cryptocurrency.

Valkyrie Bitcoin Strategy ETF

This ETF is relatively new but has quickly gained attention. It focuses on Bitcoin futures contracts, offering a different angle on Bitcoin investment.

VanEck Bitcoin Trust

VanEck is known for its innovative investment products, and its Bitcoin Trust is no exception. It aims to reflect the performance of Bitcoin, offering investors direct exposure to the cryptocurrency’s price changes.

Bitwise 10 Crypto Index Fund

For those who want broader exposure, the Bitwise 10 Crypto Index Fund covers the top 10 cryptocurrencies by market cap, not just Bitcoin. It’s a good option if you’re looking to diversify within the crypto space.

Each of these options has its unique features and approaches to Bitcoin investment. Whether you’re looking for something straightforward like the ProShares Bitcoin ETF or something more diverse like the Bitwise 10 Crypto Index Fund, there’s likely an ETF that fits your investment style and risk tolerance.

Remember, investing in Bitcoin, whether directly or through ETFs, carries risk. It’s always wise to do your own research and consider seeking advice from a financial advisor to find the best fit for your investment goals.

How to trade Bitcoin ETFs

Trading Bitcoin ETFs is like playing a video game where you need to know a few key moves. Let’s make sense of terms like ‘bitcoin tracking’ and ‘bitcoin exchange-traded note,’ and also explain how different platforms work for trading these crypto ETFs.

Bitcoin Tracking

 Imagine Bitcoin’s price is like a rollercoaster at an amusement park. ‘Bitcoin tracking’ is like having a model of that rollercoaster in your backyard. The ETF follows the ups and downs of Bitcoin’s price, just like your model coaster follows the same path as the real one.

Understanding Bitcoin Exchange Traded Notes (ETNs)

Think of ETNs as a promise note from your school friend. They promise to pay you back your lunch money with a little extra. In the financial world, an ETN is a promise by a company to pay you based on Bitcoin’s price performance. 

But remember, if your friend moves away, you might not get your money back. Similarly, if the company behind the ETN has problems, your investment could be at risk.

Trading platforms for Bitcoin ETFs

Now, let’s talk about where you can trade these ETFs. You’ve got two main options: brokerage platforms and crypto exchange platforms.

  • Brokerage platforms: These are like your regular supermarkets where you can buy all sorts of things (stocks, bonds, ETFs). Trading Bitcoin ETFs here is like buying cereal from a supermarket. You use the same cart (platform) you use for other shopping. These platforms are user-friendly and regulated, offering a familiar environment for regular stock traders.
  • Crypto Exchange. These are specialized stores, like a shop that only sells video games. They mainly deal with cryptocurrencies. While you can’t directly buy Bitcoin ETFs here, these platforms are where the action happens for Bitcoin and other cryptocurrencies. They offer more crypto-specific features and can be a bit more complex to use.

The main difference between these platforms is what you can buy on them. Brokerage platforms offer a variety of investment products, including Bitcoin ETFs, while crypto exchanges focus on cryptocurrencies. 

Also, brokerages are often seen as more beginner-friendly and regulated, while crypto exchanges offer more in-depth features for crypto trading.

Crypto vs crypto ETFs: comparing investment options

Let’s talk about the difference between buying cryptocurrencies directly and investing in crypto ETFs, and how these stack up against other investment options like mutual funds.

1. Direct crypto investment

Imagine buying cryptocurrencies like Bitcoin or Ethereum directly is like owning a specific type of exotic fruit. You have full control over it; you can eat it, save it, or sell it. However, you need to know where to buy it, how to store it safely and be ready for its price to jump up and down wildly.

2. Crypto ETFs

Now, investing in a crypto ETF is like buying a fruit basket that includes a bit of this exotic fruit along with other types. You don’t own the fruit directly, but you own a share of the basket. It’s simpler and safer in some ways because you’re not responsible for taking care of the individual fruits, and you also get a variety, which can balance out the risk.

3. Crypto ETFs vs traditional mutual funds

Traditional mutual funds are like a pre-packed lunch – you know what you’re getting, and it’s usually a well-balanced meal.

Mutual funds pool money from many investors to invest in stocks, bonds, or other assets and are managed by professionals. They’re not as volatile as cryptocurrencies but may offer lower returns.

4. Platforms for trading

The difference in platforms is like shopping at different types of stores. 

Crypto exchanges are like speciality stores where you buy and manage individual types of fruit (cryptocurrencies). Some of the most popular centralized exchanges (CEXs) are Binance, KuCoin, WhiteBit, Kraken and Coinbase.

In contrast, brokerage platforms where you trade ETFs are like big supermarkets where you can buy fruit baskets (ETFs), along with other groceries (stocks, bonds).

As you see, there is more than one way to invest in crypto. Investing directly in cryptocurrencies is for those who want full control and are comfortable with high risk and volatility. 

Crypto ETFs, on the other hand, offer a simpler, more diversified way to get into the crypto market, much like traditional mutual funds, but with a focus on digital assets. 

And where you shop (trade) depends on whether you want to manage individual assets or prefer a more diverse, managed portfolio.

Ethereum’s Centralization Dilemma: A Double-Edged Sword of Staking and Node Operations

Ethereum’s Centralization Dilemma: A Double-Edged Sword of Staking and Node Operations

While Ethereum staking is on the rise, it brings with it the challenge of increased centralization. Even Ethereum co-founder Vitalik Buterin acknowledges this as a core issue, suggesting that a comprehensive solution may be decades away.

The growth in Ethereum staking has surged since the Merge update. 

But this has led to two issues: the network becoming more centralized and people earning less from staking. 

The team at JPMorgan, headed by top executive Nikolaos Panigirtzoglou, cautioned investors about these rising concerns related to Ethereum’s increasing centralization.

The leading five easy-staying services—Lido, Coinbase, Figment, Binance, and Kraken—hold more than half of all staked Ethereum.

According to Dune Analytics, over 31% of all ETH staked belong to the Lido pool. 

While people in the crypto world have viewed Lido as a better option than centralized services like Coinbase or Binance, the reality is different. 

Ethereum's Centralization Dilemma
Source: Dune analytics 

Even decentralized platforms like Lido still have a lot of control concentrated in a few hands. For example, one Lido node operator alone manages over 7,000 sets of validators, holding 230,000 Ether.

This concentration of power occurs because Lido’s decision-making is controlled by a small number of wallet addresses in their decentralized organization, known as a DAO. 

While there was a general market proposal to limit each staking service to no more than 22%, Lido’s DAO voted against it in June 2023. In general, a DAO is a self-governing platform, but in this case, its decision to not limit its Ether staking is making the entire Ethereum ecosystem more centralized and, thus, more vulnerable. 

Having too much control in one place poses a risk to the Ethereum network. A small group of major stakeholders or node operators could become a weak point in the system, or even collaborate to gain unfair advantages.

In addition to concerns about centralization, the Ethereum network has also seen staking yields go down since the big updates like the Merge and Shanghai.

The average block rewards have dropped from 4.3% to 3.5%, and overall staking yields have gone from 7.3% to around 5.5%.

It’s not just JPMorgan ringing the alarm bells about Ethereum’s growing centralization after the Merge, which was launched on September 15, 2022. This update is viewed as a stumbling block to Ethereum’s goal of being fully decentralized, and it has also led to reduced earnings from staking.

Even Ethereum’s co-founder, Vitalik Buterin, acknowledges the issue. In September 2023, he admitted that tackling the problem of node centralization in Ethereum is a big challenge, and finding an ideal solution could take up to two more decades.

Simplify node operations on Ethereum

Ethereum co-founder Vitalik Buterin says that making it simpler and less expensive to operate nodes is crucial for addressing the Ethereum network’s centralization issue. 

Right now, most of the nearly 6,000 active Ethereum nodes are hosted by centralized services. The top service used it Amazon Web Services, posing a vulnerability for the network.

While speaking at Korea Blockchain Week, Buterin identified six critical challenges to overcome to ensure Ethereum stays decentralized over time. 

One major aspect is making it technically easier for people to operate nodes. “Statelessness is a key technology to make this possible,” he added.

As of now, running a node requires hundreds of gigabytes of data storage. 

With stateless clients, however, you could operate a node without needing almost any storage space at all. This statelessness means eliminating the need for centralized services to verify network activities. 

According to the Ethereum Foundation, true decentralization can only happen when running an Ethereum node becomes accessible and affordable.

Buterin emphasized that statelessness is a significant part of Ethereum’s future plans. Major progress towards this goal is expected in upcoming phases called “The Verge” and “The Purge.”

He mentioned that the long-term vision is to have fully verified Ethereum nodes that are so streamlined you could literally run one on your phone.

Lido Defies 22% Self-Limit Rule Amidst Mixed Reactions

Lido Defies 22% Self-Limit Rule Amidst Mixed Reactions

While multiple Ethereum staking services are pledging to limit their market share to 22%, Lido Finance takes a different path, sparking debates on centralisation and community values.

The top five companies that offer ether staking pools for individuals have stated that they won’t control more than 22% of all ETH currently staked. 

This is a way to make sure that no single company has too much power over the Ethereum network, keeping it open and fair for everyone. 

Companies like Rocket Pool, StakeWise, Stader Labs, and Diva Staking are either already following this rule or planning to do so, says Superphiz, a key Ethereum developer. 

Puffer Finance, another such company, has also said they’ll stick to this limit.

Lido doesn’t obey the 22% of ether staked limit

Why 22%? 

Superphiz explains that to make any big changes to the Ethereum network, 66% of the participants have to agree. 

By setting a limit of 22%, it ensures that at least four big companies would have to work together to push through any major updates. This makes the network safer and more secure.

When talking about blockchain transactions,  the finality of a transaction is the moment when transactions are locked in place and can’t be changed. 

Superphiz, a leading Ethereum developer, brought up an important question last May: 

Would a company that helps people stake Ethereum be willing to put the network’s well-being over its own profits?

Interestingly, Lido Finance, the biggest company of this kind, decided not to follow the 22% self-limit rule. Almost all of their members (99.81%, to be exact) voted against it back in June. 

Superphiz mentioned in a post at the end of August that Lido aims to control most of the deciding power in the Ethereum network.

To give you an idea of how big Lido is, they control 32.4% of all Ethereum that’s currently being staked. 

That’s a big deal, especially when you consider that the next largest, Coinbase, only has an 8.7% share, according to data from Dune Analytics.

Source: Dune Analytics

What’s the right thing to do?

Well, the Ethereum community has different opinions on that. 

One expert named Mippo commented at the end of August that the 22% self-limit rule isn’t really about staying true to Ethereum’s ideals, which are about open access and innovation for everyone. 

Mippo thinks that those advocating for the self-limit would probably not stick to it if they were in the dominant position like Lido Finance. In his view, everyone is just acting in their own best interest.

Another person argued that user-friendly services shouldn’t be criticised as greedy. 

On the flip side, some people are really concerned that a few big companies could end up controlling too much of the Ethereum network. They see Lido’s large market share as a problem, even calling it “selfish and disgusting.”

Why is Lido Finance the top staker on Ethereum?

Lido ticks all the boxes when it comes to staking services. 

They support multiple types of digital money and make it super easy for anyone to use their platform. 

Their fees are fair, and they even offer nice rewards if you refer people to their service. On top of that, they make a lot of different cryptocurrencies more available for trading and are backed by some big names in the decentralised finance world. 

What’s cool is that when you stake your digital tokens with Lido, you get back tokens that are tied to the value of what you staked. You can then use these for more ways to earn money in the DeFi world.

Lido has become a top pick for people looking to stake their digital assets thanks to some standout features. 

First off, staking is a breeze; you can earn daily rewards by simply staking your tokens, and there’s no minimum amount you need to start.

Want to make even more from your tokens? 

Lido allows you to use them for things like loans, yield farming, and other money-making activities. This can give your earnings a nice boost.

They also have their own digital token, called LDO, that you can trade on popular exchanges like SushiSwap, Uniswap, and many more.

When it comes to security, you can rest assured. Lido’s smart contracts have been thoroughly checked by reputable firms like Quantstamp and Sigma Prime.

Although Lido doesn’t offer its own wallet, you can still use popular ones like TrustWallet and MetaMask to manage your assets.

The Perilous Intersection of CBDCs and Government Oversight

The Perilous Intersection of CBDCs and Government Oversight

NYU law professors Richard Epstein and Max Raskin published a paper to explain the potential hazards of central bank digital currencies, highlighting the risk of overstepping governmental boundaries and the importance of maintaining the ‘separation of money and state’.


Central banks worldwide are swiftly progressing with their explorations in creating digital currencies. 

Numerous examples, such as the recent announcement of a successful prototype by the New York Federal Reserve or the Bank of England’s achievement in the subsequent phase of its digital pound trial, indicate that over 130 nations globally are considering the idea of central bank digital currencies (CBDCs).

The reasoning behind this is twofold. 

Firstly, central banks can position themselves as protectors of consumers and innovators in cost-saving technologies by eliminating the role of private banking intermediaries

Secondly, they can acquire an additional mechanism for policymaking.

However, the proposition of excluding these intermediaries raises an important question of who would be responsible for the other end of the financial transactions. 

The inevitable answer is a far-reaching and intrusive government capable of monitoring every single expenditure.

Digital cash? 

Max Raskin, an adjunct professor of law at New York University and a fellow at the school’s Institute for Judicial Administration, and Richard Epstein, a law professor at New York University, a senior fellow at the Hoover Institution, and a senior lecturer at the University of Chicago, are exploring this topic in a paper called “A Wall of Separation Between Money and State: Policy and Philosophy for the Era of Cryptocurrency,“ published in The Brown Journal of World Affairs.

Their argument suggests that a central bank, for instance, the Bank of England, would issue a “digital pound,” which would be a direct claim on the central bank, much like current cash is. 

This process would involve creating the necessary infrastructure for individuals to store digital pounds in digital wallets and facilitate interactions with retailers and other users.

Contrasting current practices where central banks such as the Federal Reserve and the Bank of England do not offer accounts to direct depositors, the proposed model would eliminate the costly private banking system that presently stands between the central bank and the accounts held by businesses and individuals.

At a glance, it seems that CBDCs might cut unnecessary costs

However, these apparent efficiency benefits can be deceptive and hazardous. 

Intermediaries function in thousands of markets, with representatives, aggregators, and monitors in almost every significant business line. These participants can’t be easily deemed obsolete.

Intermediaries often provide value as they are motivated to offer more than the bare minimum to stand out – such as new banking products and services. 

The variety of services banks can offer due to competitive pressures that ultimately benefit consumers. Restricting these forces can hamper the market economy.

CBDC implementation can be risky

The implementation of CBDCs is not without risks. 

The idea of providing extensive power and confidential information to a faceless government entity can be alarming. The system can use that data against you in numerous ways. 

By removing the private banking intermediaries, CBDCs would eliminate a crucial barrier that currently safeguards individuals and firms from government intrusion and overstepping.

The use of cash and bearer instruments is currently untraceable by the central government. 

However, the use of digital cash would be. 

It’s clear that even those who decide to stick with private bankers will still be scrutinised by the state, which holds control over all transactions.

Moreover, these digital funds would empower central banks to direct personal loans and mortgages to specific private parties with minor competition, raising concerns around state industrial policies. It’s not hard to imagine potential nightmare scenarios, yet they are difficult to avert.

The question remains: can we trust thousands of new banker-bureaucrats to perform any better?

Can we trust banks?

The Bank of England, in its digital pound argument, emphasised the British government’s commitment to fighting climate change, stating that the digital pound would be designed with this objective in mind.

Why should a topic as intricate and contentious as climate change be regulated through the financial system?

Similarly, U.S. financial regulators have started to wade into political issues like climate change.

If such explicit political objectives are considered, it is not a stretch to imagine a government-run bank using its powers to favour certain energy producers and punish others through their bank accounts. 

The power to impact credits and debits must be a feature of the central banks’ proposed code, which introduces a covert system of industrial policy.

If CBDCs become a reality, officially favoured energy sources like solar and wind power could witness their bank accounts receiving subsidies without the need to attract private investors or undergo the scrutiny of the private banking system. 

Bank accounts could become vulnerable to political manipulations, bureaucracies, or even disenfranchisement overnight with limited recourse.

Furthermore, these CBDC initiatives in the U.S. were originally proposed in the context of directly providing pandemic stimulus to the economy. However, the evidence is overwhelming that this hasty system of government payments was incredibly wasteful.

Moreover, central banks could implement countercyclical monetary policies, such as providing cash boosts to individuals in specific regions or sectors, which again becomes a political football.

Money and new technologies

We should undoubtedly strive to leverage new technologies, but only when implemented correctly. According to the paper in the Brown Journal of World Affairs, “Money should be a neutral unit of measurement, like inches or kilograms.”

This concept, referred to as the “separation of money and state,” aims to stabilise all currencies over time, minimising the need for private parties to design complex and costly mechanisms like adjustable-rate mortgages to handle financial instability.

For instance, Bitcoin has a predetermined supply of no more than 21 million units, not governed by any individual institution but rather by the network’s consensus mechanism. 

This feature provides a robust defence against value dilution that no government-centric system could hope to match.

This fixed system could offer additional institutional support for developing countries seeking modernisation. 

Countries with a history of mismanaging their monetary systems could benefit from the discipline that comes with certain forms of digital currency. 

For instance, a central bank like Zimbabwe‘s or Argentina’s, plagued with mismanagement, could adopt an innovative form of dollarisation using Bitcoin or another form of programmed cryptocurrency.

Buying a Car With Bitcoin? Here’s Everything You Need To Know

Buying a Car With Bitcoin? Here’s Everything You Need To Know

Are you planning on buying a car with Bitcoin? Cryptocurrency is now used to buy real-world assets such as cars and even real estate. While this payment method isn’t accepted worldwide, more and more services are starting to consider it. And car dealerships are no exception. 

In 2021, Tesla’s CEO, Elon Musk, announced that it would accept Dogecoin as payment for Tesla. Meanwhile, the offer is no longer standing, but that doesn’t mean you can’t use Bitcoin to buy a car in 2023. 

Is it legal to buy a car with Bitcoin?

Yes, it is indeed legal to purchase a car using Bitcoin. You can also use other popular cryptocurrencies, such as Dogecoin and Shiba Inu. However, similar to any other online transaction, it is important to exercise caution and adopt certain safe practices.

The first thing you need is to find a reputable car dealership that accepts Bitcoin as a payment method. 

You can do this by checking out reviews on third-party consumer forums to discover the best places to purchase cars with cryptocurrencies. Platforms such as Crypto Emporium and BitCars have supported crypto payments for some years now and have excellent reputations in the market.

One of the advantages of using cryptocurrencies like Bitcoin for transactions is that they are generally secure. This means that you do not need to disclose any personal financial information, as transactions take place directly between two digital wallets. This method of payment contributes to your safety and security during the transaction.

https://cryptoemporium.com/automotive/cars/tesla-model-s-p90d/ buying a car with bitcoin
Source: cryptoemporium.com

Where to buy a car with Bitcoin

Where do you go to buy a car with cryptocurrency? 

While there is no car manufacturer that accepts cryptocurrency throughout their distribution network as a whole, there are specific car dealerships that have implemented cryptocurrency payment services to serve customers who wish to complete their purchases using digital assets. 

In the end, it’s up to you to find a platform that allows crypto payments for products such as cars. Some of the most popular options for such purchases include: 

One of the most popular payment services is BitPay, which is already used by some Lamborghini and BMW dealerships thought Europe, the UK and the USA. 

Finding out if a car dealership accepts Bitcoin or other cryptocurrencies is simple. The quickest way is to call local dealerships and ask. Salespeople might need to check with management, but they should give you an answer soon.

You can also look at car dealership websites to see if they accept Bitcoin. However, these sites mainly focus on selling cars and might not clearly mention payment methods, so it could be a bit frustrating unless the dealership prominently displays this option.

How to buy a car with Bitcoin (or any other cryptocurrency)

Buying a car with cryptocurrency can be done from a dealer that accepts it or from a private seller who is comfortable with crypto. Usually, dealing with a dealer is easier. Here’s a simplified plan:

  1. Find out which dealerships accept cryptocurrency.
  2. Research different cryptocurrency exchange apps and learn how they work. The dealer might prefer a certain app like BitPay. Depending on the payment processor, you might need to set up an account. 
  3. Confirm that the dealer accepts the cryptocurrency you own. Bitcoin is one of the most commonly accepted.
  4. Choose the car you want to buy.
  5. Follow the dealership’s instructions for the exchange.

What’s the advantage of buying a car with Bitcoin?

There are several reasons why some crypto investors prefer to use Bitcoin to buy a car:

  • Fast Payments. Bitcoin transactions are usually faster than traditional fiat payments. Traditional payments rely on bank transfers or credit/debit cards, which require multiple intermediaries for processing. In contrast, Bitcoin transactions are decentralised and don’t involve intermediaries, allowing for quicker transactions that often take only a few minutes.
  • Highly Secure Payments. Bitcoin transactions use advanced encryption techniques, making them highly secure. They are recorded on a public ledger called the blockchain, which is virtually impossible to counterfeit or alter. Once a transaction is recorded on the blockchain, it can’t be amended or deleted. This immutability makes all transactions permanent and tamper-proof, hindering anyone from manipulating network records.
  • Lower Transaction Fees. Bitcoin transactions typically have lower fees than traditional payment methods such as credit cards or wire transfers. This advantage becomes especially significant for international transactions, where traditional remittance fees can be high. Crypto transactions could potentially eliminate 97% of these fees, making large, cross-border transfers more cost-effective.
  • No Transaction Limits. When purchasing a car with Bitcoin, you don’t need to worry about transaction limits. This is important when making big purchases like cars. Credit card companies and banks may decline a purchase exceeding a certain amount, but cryptocurrencies have no such limitations. This ensures that the transaction proceeds without any delays.

Should you buy a car with Bitcoin?

Whether or not you should buy a car using Bitcoin greatly depends on your comfort level with risk and volatility. 

Cryptocurrencies, including Bitcoin, are known for their dramatic price swings.

Take, for example, Bitcoin’s performance in November 2021, when it reached a high of nearly $69,000. At that point, you could have purchased a new Porsche 718 Cayman with just one Bitcoin. Fast forward to the present, Bitcoin’s value is around $17,000, so the same Bitcoin would only be enough to buy an average city car.

The value of cars doesn’t fluctuate as significantly as cryptocurrencies, which makes this kind of transaction risky. However, a workaround for this volatility could be to use stablecoins, which are cryptocurrencies designed to maintain a stable value relative to a specific asset or a pool of assets. A good example is the USDC or USDT,  which you can store in a crypto wallet and use for car payments, thus mitigating the risk of your crypto’s value suddenly dropping.

That being said, if you are a firm believer in the future of cryptocurrencies and their potential to revolutionise our financial system, buying a car with Bitcoin could be an exciting way to apply this innovative technology. Plus, there is a certain novelty factor in being able to tell your friends that you bought a car using Bitcoin.

Ultimately, the decision to buy a car with Bitcoin should be based on your personal financial situation, your tolerance for risk, and your belief in the future of cryptocurrencies.