Overnight, BTC continued to recover to the 56-57k range. In the past 9 months of 2024, the average cost of adding positions is about 63.5k, and now the floating loss is 10%. Looking back, the three instantaneous lows of 53k on July 5, 49k on August 5, and 52.5k on September 7 are the three precise bottom-picking points since the beginning of this year. I wonder how many immortal hands can catch this fleeting wonderful moment every time, and how much position can be caught if caught? I'm afraid it's not easy.
For all BTC traders around the world, from the perspective of fiat currency, it is a negative-sum game. The general formula is as follows:
The amount of fiat currency invested by the buyer - the amount of fiat currency taken by the seller = the handling fee deducted by the trading platform + the mining income earned by the miner
What we are talking about here is the issue of the cash flow and direction of fiat currency. From this perspective, floating profits are not considered gains, and floating losses are not considered losses, because they have not yet completed the entire closed loop from buying to selling.
As a buyer, you invest fiat currency and obtain BTC. No matter what the trading motivation is, long-term holding or short-term speculation, at the moment of the transaction, the fiat currency has already flowed into the hands of another person.
The recipients of net inflows of fiat currency are trading platforms and miners.
Ultimately, if long-term holders are making money, trading platforms are making money, and miners are making money, then the people who provide a steady stream of profits to these three parties are and can only be the endless group of traders. They burn their own capital and illuminate the entire market. Individual examples of getting rich quickly attract them to move forward like moths to a flame. The sweetness of small wins continues to enrich their self-confidence and make them lose themselves. Big bets and big losses make them blame luck and swear to start over.
From a higher dimension, hoarders who hold but do not sell do not earn fiat currency from the system. They are real investors. Traders and trading platforms are just tools that provide liquidity and channels to help investors invest capital in the people who build and maintain the system infrastructure (computing power) - miners.
The production of BTC, or mining, uses a so-called proof-of-work (PoW) mechanism, which uses special chips to perform large amounts of calculations 24 hours a day, consuming huge amounts of electricity.
Even if we put aside the debate about whether BTC is useful, just looking at this very green and environmentally friendly production process, it has a very beneficial use: driving infrastructure development on the power supply side.
Russian President Vladimir Putin said in a speech at the Eastern Economic Forum that Russia has become one of the world leaders in Bitcoin mining. Putin believes that mining can utilize excess energy in regions such as Siberia.
Compared with the electricity demand of traditional industries, factories usually choose to build near the sea because they need to consider the transportation costs of products. As a result, they are bound to stay away from green electricity, such as the northwest and southwest where wind power, hydropower, and photovoltaics are abundant.
Green electricity distributed in the vast western region has low density and is scattered. The construction cost of transmission lines is high, which often leads to green power projects operating at a loss. However, the national strategy requires the vigorous construction and development of these new energy and low-carbon infrastructure projects to boost the relevant industrial chain, employment, and economy. This often requires high subsidies, which are paid by the whole nation.
However, BTC mining factories do not need to be built on the coast, but can be built directly next to these wind power, hydropower, and photovoltaic power generation facilities. All they need is an Internet connection - even wireless networks can be used if there is no wired network, or satellite networks can be used if there is no wireless network, and they can access the BTC global network to carry out mining work, and immediately convert green energy into economic benefits nearby.
This not only greatly saves the uneconomical investment in building a transmission network just to cover sparse power generation facilities, but also greatly saves the huge subsidies invested by the country in green energy and low-carbon development. It can even allow those green power projects that originally could not pay back for N years to quickly turn losses into profits, and rely on the power of capital returns rather than the power of national investment to promote the faster development of low-carbon energy infrastructure construction.
In this sense, what BTC investors are investing in is actually the energy industry of the future of mankind, including low-carbon energy, green energy, and even controlled nuclear fusion, the next generation of new energy, and the next generation of updated energy.
Today, people can say that BTC cannot be eaten, worn, or used to buy anything, and is completely useless. However, the BTC network’s ability to accurately, efficiently, and automatically allocate the capital of global investors to the latest energy development track is already of supreme value.
Anyone who has ever invested knows that the greatest value of investment is to seek the best allocation of capital. And anyone who understands the history of human development knows that the real underlying factor that determines the course of human history is energy - so much so that the Kardashev Index directly uses energy utilization as the only parameter to measure the level of human civilization and cosmic civilization.
BTC solves the above two major problems at once - automated capital allocation and human energy upgrade - even if the final solution to the third problem - value-preserving currency - is controversial, don't you think its value is great multiplied by great - great to the power of two? If all three problems are solved by BTC, then is it great to the power of three?
Therefore, the use of uselessness is the greatest use.
The same is true for the recently popular 3A game "Black Myth: Wukong".
Many people criticize that playing games is "useless", a waste of time and productivity, and so on. But why can't China's graphics chip technology develop? Why doesn't China have Nvidia? Is it related to our consistent disdain for games? You know, Nvidia's earliest motivation for making graphics cards was driven by the demand for electronic games, especially 3D animation games that require a lot of computing power to render.
Playing video games may seem useless, but it provides demand and profits for graphics card production, greatly boosting the development of the graphics card chip industry.
Mining may seem useless, but it also boosted the development of graphics cards. That’s right, Nvidia’s second wave of development dividends was driven by Ethereum’s early use of graphics cards for mining.
The third wave of development of graphics cards is the AI big model that is currently in full swing.
Video games - virtual currency mining - large AI models, three-stage rockets, have pushed Nvidia to unprecedented heights, with a market value of US$2.6 trillion, ranking among the top three technology stocks (after Apple and Microsoft).
Now the national strategy is to develop AI, and if we don’t want to be strangled by the United States, we need to incubate China’s Nvidia. Subsidies are not only costly, but also easy to produce “Hanxin” that is fraudulent and corrupt. We must use the power of the market to achieve speed, quality and economy.
So I had to start making up for the lost time with video games.
Things have their own laws of development. Just because you feel full after eating the third steamed bun does not mean that the first and second steamed buns are useless.
The first two steamed buns, which seem useless, actually have a great effect. It is impossible to be full by eating only the third steamed bun. It is narrow-minded and short-sighted to limit your vision and thinking to a single steamed bun.
(Disclaimer: The content of this article does not constitute any investment advice. Cryptocurrency is an extremely high-risk product and there is a risk of it returning to zero at any time. Please participate with caution and be responsible for your own actions.
