1.
Finally, we have proof that the Chinese government has been deliberately and systematically manipulating the market at http://chinadigitaltimes.net/2014/05/mi ... m-bitcoin/.
What's striking about these instructions are not only that they exist, but also that the directions that relate to bitcoins are the longest and most detailed of them. It's not as if the instructions read something like "please censor articles with the following topics: A, B, C, D, E, F, G, H, bitcoins, J, K, L, N, O, and P." Instead, they devote three sentences to bitcoins where all the other topics get a one-sentence mention. They also say "please carry this out immediately."
We can now put to rest the idea that bitcoins are just another thing that the Chinese have to worry about, far behind other things. They know exactly what bitcoins are, they recognize that they are a threat to them, they are taking all the actions they can, and they are out of options.
As freedom-loving individuals, we should be glad that this has happened. The Chinese have removed themselves from one of the greatest technological innovations that has happened in many years. We will make lots of money, and when bitcoins are worth $50k and the Chinese have no choice but to allow free trade, they will be transferring their wealth to us, setting their autocratic government back by a significant amount.
2.
Not only that, but the markets failed to move whatsoever on this news, which would have been completely earth-shattering if released in January. In January, such news would have probably caused a crash to $100 before a rebound. Now, nobody cares.
The only constant is the bubble cycle. As long as bitcoins survive, bubbles occur again and again. News is irrelevant in the grand scheme of things.
3.
Some people have criticized me when I talk about the future role of banks in bitcoins, so let me mention that. As bitcoins continue to grow and become a popular method for transmitting money across the world, banks will also see the value in cutting out other banks from taking a share when they send money around the world.
However, banks can improve their profits even more by mining bitcoins. If they hold their own transactions until they find blocks, then they can make transfers to anyone for free - and they can even withhold transactions from other banks with whom they are competing. Therefore, the future of mining lies in huge investment banks. In several years, the miners aren't going to be rigs in people's basements; they will be either huge plants owned by banks, or hardware producers who have contracts with banks to produce a certain number of blocks per day.
In this scenario, the block rewards are not significant to the banks, because they want to control the timing and content of the transactions, so they will be willing to take a loss. Non-bankers will not be incentivized to mine at a loss, so mining will become exclusively the domain of huge Wall Street firms.
Other entities may also have an interest in controlling their own transactions. The US government, for example, might decide to target one block per day to send enormous sums of money to creditors. But since banks control most of the world's money, it is likely that banks will also control most of the world's mining.
4.
In addition to the bitcoin I purchased on Thursday, I bought another eight bitcoins yesterday.
This brings up an interesting point: you might ask how I can purchase so many bitcoins just by putting a paycheck aside. I asked myself that as well, and the answer I came up with is that I don't do anything at the moment except work. I work on weekdays, then drive home and work more - and on Saturdays and Sundays, I do work on the mining pool for 20 hours.
So it turns out that working "overtime" doesn't just pay off in extra salary (although in this case, I may earn nothing in the end), it also pays off because you have no use for money. Over the past few months, my only credit card charges were (in order from most to least expensive) Federal taxes, rent, takeout, groceries, and transmission/oil/brake fluid/rust remover/gasoline to go back and forth to the office 5 miles per day. There were no luxuries.
So you either work a lot but have no reason for so much money, or you work a little and don't have enough money to enjoy life. Seems like a lose-lose situation.
Other
- Days until July 24: 75