May 2023 proved to be a rollercoaster month in the world of economics and cryptocurrency. The (All Powerful & Mighty) United States, teetered on the brink of debt default. The debt ceiling was maxed and the Democrats and Republicans tussled for an agreement over raising the level of borrowing that the US was allowed. We wrote a full explainer yesterday here. Today the details of a deal finally emerged with the debt ceiling being suspended altogether. I wonder (sarcastically) if this move will stop the exponential growth of US debt?

Back in the day when dollars were backed by gold (real money), currency notes were quite literally gold certificates, exchangeable for gold. Check out the image below to see how it looked. Quite different from what Americans use as currency today, isn't it? Today, the basis of currency is trust. For instance, the note in the first image says, "In God We Trust". This begs the question - should we have to trust anyone when dealing with money?

The current fiat money system in the US isn't backed by any physical assets. It operates solely on the "Full Faith and Credit" of the U.S. government. This may have been a workable system back in the 70s, but in the face of an exponentially growing debt to GDP ratio of 130% and rising inflation, one can't help but question the solidity of this faith.

Perhaps, the answer to this conundrum lies in a predictable, non-debaseable form of currency – Bitcoin. The appeal of Bitcoin lies in its finite supply, making it immune to printing or manipulation.

As the piece linked here talks about Bitcoin may just be "The Ultimate Asset of the 21st Century" 

But we could be way off the mark. Maybe you should trust this guy:

As we highlighted on socials, Binance has had significant regulatory setbacks this month. Following regulatory enforcement action by the SEC, FTCA as well as being sued privately in the US, Binance left Canada entirely and has now lost its AFSL (Australian Financial Services Licence) and banking access in Australia. This is significant because Binance is the worlds largest exchange and has grown in market share since the FTX exit. This development had a stunning effect. Aussie investors were able to withdraw but not deposit which caused a decoupling to happen between the AUD denominated markets on Binance and the world price. For example BTC price denominated in AUD on Binance was at times 40% lower than what you could get at Stormrake.

So, anyone that sold crypto into AUD on Binance was getting a 40% haircut. Anyone that withdrew AUD missed out on a 40% arb where they could have bought BTC, sent to Stormrake and sold into AUD for a 40% higher price and withdrawn to their bank account. Of course they could also have just kept the cheap BTC in Stormrake custody. 

Allow us to toot our own horn for just one paragraph. As a Stormrake client you benefit from being able to get the best price of 20 exchanges all over the world and benefit from multi pronged banking networks. That means that when Binance or any other exchange has issues you will still be able to maximise your buy and sell prices. Stormrake currently tracks 6,000+ Markets around the world and over 1,000 tokens (But you may only need 1). 

• Binance pulls the pin on AUD pairs (Markets) following its loss of its AFSL and its banking relationship with Westpac. As a result Binance records significantly lower prices for crypto in AUD.
• De-dollarisation escalates.  Iran pushes ahead with de-dollarisation meeting with 11 significant countries. This (moving away from USD denominated trade) is "Not a Voluntary Choice" according to  Iran's First Vice President. Weaponisation of the Dollar by the US is leading to global trade looking for an alternative.
  
• Fees remain stubbornly high on ETH and BTC. Pepe craze and BRC-20 transactions force high fees despite not hitting a bull-market yet.
  
• Pepe creates Millionaires as the Meme coin rises and falls. 
  

Bitcoin, the trailblazer of the cryptocurrency world, has become a household name in the past decade. Yet, many people still struggle to understand this digital asset and its significance in the current financial landscape. This piece aims to demystify Bitcoin for beginners and shed light on its fundamental principles.

Introduced in 2009 by an anonymous entity known as Satoshi Nakamoto, Bitcoin is a decentralized digital currency operating without a central bank. The foundation of Bitcoin lies in the combination of economic incentives & blockchain technology, a public ledger containing all transaction data from anyone using Bitcoin.

Unlike traditional currencies, Bitcoin has a limited supply. Only 21 million bitcoins can ever be mined, contributing to its scarcity and value. This characteristic sets Bitcoin apart from traditional money and positions it as "digital gold."

If you enjoyed this Rake Review, feel free to open an account and gain access to more proprietary research and work with your very own dedicated crypto broker.

In the labyrinthine world of economic policy, one term that has frequently made headlines is the U.S. debt ceiling. The recent crisis underlines the contentious nature of this mechanism and brings to the forefront questions about our modern central banking system. In contrast, Bitcoin’s predetermined supply mechanism offers a striking alternative.

The information contained here is for general information only. It should not be taken as constituting financial advice. Stormrake is not a financial adviser. You should consider seeking independent financial advice prior to making any personal investments.

The recent 2023 crisis has once again shone a spotlight on this peculiar mechanism. As the U.S. government spent more than its tax revenue, the debt ceiling had to be raised to avoid default. This scenario has become a recurring theme over the years. The ongoing cycle of borrowing, spending, hitting the debt limit, and then raising it, raises valid questions about the viability of this system. 

* Significant crises happened prior to this, most recently in 2013, 2011 & 1995. 

Critics argue that the debt ceiling is an outdated concept that does more harm than good. It disrupts the financial market, undermines the economy, and adds unnecessary stress to an already complex governmental budgeting process. Moreover, it highlights the infinite loop of the central banking system, where money creation becomes a necessity to keep the economy afloat.

The central banking system, with its ability to adjust monetary supply, has been seen as an integral part of our economy. However, the frequent need to raise the debt ceiling paints a clear picture: the system requires consistent borrowing and money printing to function. This reality is not sustainable and opens up questions about alternative economic structures.

In an era marked by monetary uncertainty, Bitcoin provides an innovative alternative to traditional banking systems. It offers a decentralized, transparent, and fair monetary system, proving to be the antithesis of the current central banking structure. While debates around the U.S. debt ceiling continue, Bitcoin's supply mechanism stands as a testament to the power of a fixed supply and open transparency. In the end, it could prove to be the way forward in our evolving financial landscape.

If you enjoyed this Thunder Trading, feel free to open an account and gain access to more proprietary research and work with your very own dedicated crypto broker.