By JS Kim

Over the years, I’ve written a number of articles regarding why I prefer physical gold and physical silver over bitcoin (BTC). I believe in monetary competition, however, and believe that different forms of money should be allowed to compete, because the best form will eventually and quite rapidly always rise to the top. However, we are far from such an environment, as government/banking cartels have banned the use of gold and silver as systemically-wide accepted forms of money worldwide while ensuring that their rapidly devaluing fiat currencies remain the norm. So where does BTC fit into this picture? Again, I think that BTC has its place in the economy, especially since transaction fees using BTC are well below the highway-robbery rates of global banking institutions. However, BTC has yet to prove itself in preserving purchasing power over decades of time as has gold and silver, nor does it meet all 9 qualities that I deem necessary for sound money.

In any event, as some of you may well know, BTC has exhibited massive volatility in 2017, far beyond even the sometimes volatile price fluctuations in spot gold and spot silver prices. BTC started out this year reaching an interim high of $1,129.87 per BTC, then plunged a maddening 31% in just 5 trading days to $775 after the Chinese government placed more restrictions on BTC trading, but since then, has nicely recovered 24% of that plunge and has risen back to $1,052.54 per BTC. At the time, BTC rose to $1,129, many posed the question of whether BTC was better than gold, which in my opinion, it will never be due to its digital nature. Some ask why would Chinese regulations cause BTC to plunge 31% in five trading days, and the answer is simple. Chinese speculators were almost entirely responsible for the rise of BTC from $800 to $1,129 at the end of 2016 into the start of 2017. As the Chinese government took more measures to clamp down on black money leaving China, wealthy Chinese turned increasingly towards BTC as their preferred mechanism to move black money out of China, thus fueling a speculative, unsustainable rise in BTC price. Furthermore, Chinese traders not even using BTC to move black money out of the country piggybacked off of this rising, easy trade because most Chinese BTC exchanges charged no fees on either end of the buy and sell transactions for BTC. However, when regulators changed these rules and implemented a 0.2% transaction fee on both ends of the trade, the easy speculative profits disappeared, and in response, BTC volumes collapsed 90% almost overnight on every Chinese BTC exchange.

Though the easy profits of HFT bankers trading the Chinese BTC exchanges disappeared, this was a constructive development for the BTC market, because though HFT traders always claim that they benefit markets by providing “liquidity”, such claims are rubbish, and most HFT traders destroy markets by destroying real price discovery. Thus, the less HFT traders that exist in any market, the less volatility in prices there should be. However, since Chinese traders alone fueled the vast majority of the rise in BTC price at the end of 2016 into the start of 2017, it is always critical to track what is happening to the Chinese BTC market to understand what may happen to BTC prices in the future. As an analogous example, ask yourself what would happen to a company’s revenues if the company received 90% of its revenues from one customer and that customer decided not to renew its contract with that company? For now, this is how much influence the Chinese can have over short-term BTC prices. Given the fact that the People’s Bank of China (PBOC) just conducted meetings with the top Chinese BTC exchanges yesterday, 8 February 2017, with one of the main topics allegedly a crackdown on the use of BTC to move black money out of China. If the PBOC cracks down on future Chinese BTC transactions, this could cause another huge, rapid sell-off in BTC prices. In fact, a Beijing BTC trader acknowledged that due to such worries, a lot of Chinese have been shorting BTC. The market detests uncertainty, and the large volume of Chinese shorting BTC now seems to be insurance against the uncertainty of new regulations the PBOC may place on trading BTC in the very near future.

In any event, I stated years ago that the end game of the global banking cartel is to force all citizens to use 100% digital currencies. This much became crystal clear, when JP Morgan banker, Blythe Masters, left the bank to join Digital Asset, a company that focuses on the blockchain, the underlying software that propels digital currencies like BTC. Blythe Masters has a long history of pioneering financial and wealth destruction throughout the world, having been the key developer of CDS (Credit Default Swaps), a massive weapon of financial destruction that triggered the 2008 US mortgage crisis, and alleged to have been the mastermind behind JP Morgan’s silver price suppression scheme in silver futures markets (a criminal act for which JP Morgan is still being investigated).

Given her history of involvement in technologies that lead to pure wealth destruction for the majority and wealth transference to the very few, it should be terrifying to most BTC holders that Masters has declared that the BTC arena has a “need for people like [her]”. As BTC supporters have always lauded BTC for being outside the control of the global banking industry, the fact that one of the most well—known executives of the global banking industry states that BTC has a “need for people like [her]” seems to imply that the global banking industry has their eyes on controlling the blockchain and BTC in the future in order to reach their end game of imposing 100% digital currencies on us in order to restrict our freedom and control us in the future. I hope I am wrong about this intent, but we all need to keep an eye on these partnerships of global bankers with digital currencies that seem to already by progressing forward.

Recall, that whenever we’ve seen dastardly global banker programs aimed at restricting people’s freedoms coming, we’ve always attempted to warn everyone. Consider the article I wrote over a year ago warning Indians that Indian PM Narendra Modi was a pawn of global bankers not to be trusted, and that no Indian should turn their physical gold over to bankers in their nation, as Modi urged all Indian citizens to do in November of 2015. Though many believed this warning to be premature, as Modi’s popularity among Indians was very high back then, my beliefs about Modi’s strong partnerships with global bankers were proven to be true a year later, when PM Modi attacked the poor in India by banning certain cash denominations and making life incredibly difficult for the poor in India, a fact lamented by a former Indian Prime Minister Manmohan Singh and Indian Congress Vice President Rahul Ghandi, who both labeled Modi’s cooperative efforts with bankers to form a cashless economy as a “war against the poor” because of how adversely Modi’s efforts have affected the poor in India. In response, PM Modi lashed back at former PM Singh, by stating that “many scams” happened under Singh’s watch too. However, note that Modi chose to engage the oldest trick in the book in employing the typical globalist modus operandus against those that criticism them – lobby ad hominem attacks in an attempt to discredit one’s opponent that will marginalize their opponent but have zero relevance to the argument at hand, and thereby kill the criticism by attacking the messenger, rather than offering an honest, intellecutal and factual rebuttal of the criticism.

In concluding, just a quick word on gold and silver and the global banking war on cash. As promised, I will continue to update you with information provided to us by our readers. One of our readers in New Zealand sent us this article about bankers’ plans to ban the $100 note here, which we wanted to pass on to you, with much thanks to him. As well, he has mentioned that he has sagely warned his readers to stockpile smaller notes like $20 notes in anticipation of this banker executed war on cash, so for more information on the state of banking affairs in New Zealand, please visit his website here. Remember, please send any notices of Central Banker plans to ban cash in your country to us at info-at-smartknowledgeu-dot-com, and we’ll continue to post these articles in future issues as a service to all of our readers. Finally, in our last post, I stated as gold and silver prices were falling, “don’t lose sight of the bigger picture. While it’s important to manage the short-term picture well during very volatile times, for the longer-term yearly view of 2017, we are still very bullish on the prospects of gold and silver assets.” This still remains true, and more on this in the next post.

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 -- Published: Thursday, 9 February 2017 | E-Mail  | Print  | Source: GoldSeek.com

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