In the news today: Circle Becomes 'Bitcoin Unicorn' With Bitmain-Backed Mega-Round

Introduction

I have been watching the centralised money enter crypto. Don't confuse "centralised" with "institutional". Institutional money is good for crypto - businesses and funds buying into existing crypto projects and pulling away from the corrupt, greedy, monopolised capital of the old order. Centralised money is evil incarnate - it's the money of the extremely rich and greedy few who determine every damn thing on this planet.

(Read these very important posts if you haven't already done so:

I take note of centralised crypto moves, and then avoid them like the plague. This is such a move, possibly the most ambitious one I have seen so far. I want to help you see things through my eyes, so I am going to go through the sentient points of the article and point out the major issues. All excerpts in this post are taken from https://www.coindesk.com/110-million-circle-series-e-bitcoin-unicorn/ where the original article can be found. I have included all the juicy bits here, so it's not really necessary to follow the link.

Make no mistake, this is a big problem for crypto. It's nothing short of a hostile takeover attempt, an attempt at market domination and control by the old order. I'm going to make damn sure that I do my part to prevent them!

To refresh your memories: the major crypto exchange Poloniex was bought out by a company called Circle. Circle is a company started by venture capital. The major capital contributor? Big old centralised money bank Goldman Sachs. Now read on...

From pexels.com

😨 Grow eyes in the back of your head... 😨

I will go through the article in the order in which it is written, commenting as necessary. Much of it speaks for itself.

Circle has closed a $110 million Series E fundraising, a figure that effectively values the startup at over $3 billion, according to figures from the company. Led by China-based mining outfit Bitmain, the round includes support from Accel, Blockchain Capital, Breyer, Digital Currency Group, General Catalyst, IDG, Pantera and Tusk Ventures.

Here it comes...

... the company is also revealing an ambitious plan to bolster its products and services by launching a "US dollar coin," or a blockchain native asset that would be both regulated and backed by real government currency

Their old cash cow, the US Dollar, the tool they use to oppress billions of people is under threat of becoming extinct. Now they seek to relaunch it as a digital version of itself. They are unwilling to give up the control (just as I wrote in the "Weapons of the War on Crypto" post that I linked to in the intro).

In this way, Circle CEO Jeremy Allaire framed the round as one that helps it position itself as a true conglomerate of cryptocurrency services, as opposed to just an exchange or payment startup
Allaire told CoinDesk:
"...A real critical piece is there has to be open, interoperable standards for our how fiat money can move over blockchains. That's where fiat stablecoins and payment protocols come into play."

They want to blur the lines between fiat and crypto. On the surface this sounds good, but it gives them immeasurably more leverage in the crypto market, and by extension, control over you. It overvalues the dinosaur fiat currencies (which are under their total control) and lends legitimacy to their new digital counterparts.

...Allaire positioned the stablecoin project as essential to Circle's maturation and continued expansion, painting it as integral...

Well, yes, he would say that. He needs it to succeed. We most certainly don't need him to, but he does.

Enjoy this suggestive propaganda:

The launch also comes at a time when Silicon Valley investors have shown a preference for investments in such products, owing to the massive role stablecoins play in facilitating global cryptocurrency exchange and the perceived issues with today's market leaders.

What utter BS! What the hell are they even talking about? What bloody "stablecoins"? The only existing stable coin of any significance is Tether (USDT). There are some smaller ones that do feature, but beyond DigixDAO (linked to gold), BitCNY (linked to Canadian Dollars) and Bolivia's recently launched Petro (linked to Oil and possibly later to other Bolivian assets), I can't think of any worth mentioning. None of them come even close to Tether.

And those issues with the market leaders? What's wrong with the top cryptos? I'll tell you what's wrong with them: nothing. Sure, they've all had a teething issue or two, but so will any other coin and all the existing ones find ways around their issues sooner or later. Note: when I speak about top coins I exclude Ripple. That menace is already a bank linked centralised coin. It's a weapon of the old order that has already been successfully deployed - exactly like this new weapon I am now discussing.

... Allaire said, that made Bitmain, the controversial cryptocurrency mining giant, a natural fit to lead the funding round. As recently as March, Bitmain co-CEO Jihan Wu had made appearances at major U.S. conferences where he vowed to back high-tech alternatives to central banking.

I guess that means that Bitmain is firmly in Allaire's pocket. Adding Bitmain to my list of centralised companies to avoid...

it's perhaps its launch of a US dollar cryptocurrency initiative with participation from Bitmain that may most impact the crypto market.

That's exactly what they want.

the play is a strategic one that finds Circle taking aim at one of the most important elements of the crypto economy.

No kidding!

And here comes more propaganda:

"It's a big piece, as we acquired Poloniex and Poloniex was a crypto-only exchange," Allaire explained. "The way people have handled fiat on an exchange like that has been through something like Tether, and we see a lot of weaknesses and challenges with Tether."

There we go, a direct attack on Tether. Please tell me you saw that coming! Tether is their main target because Tether already exists and it already works. Obviously they want to oust tether because Tether IS the stablecoin market right now.

...Allaire isn't alone, as many commentators have sought to position Tether as a systemic weakness that, through its affiliation with the troubled exchange provider Bitfinex, a company that has struggled with regulatory issues, threatens the integrity of the market.

That much is true. Tether does have a slightly dodgy history. It did look a bit fraudulent at one stage. There were concerns of it and Bitfinex colluding to create extra Tether tokens. I don't know what the final outcome of that investigation was, but the allegations were strong enough for me to close down my Bitfinex account. For what it's worth, Tether has been well behaved since then and remains stable.

Yet, it's important to note that Circle will be seeking to take an open approach to its USD-C token, framing it as an open-source project with a more robust governance model.

You can publish your code, but your code doesn't say: "Circle controls these coins and is attempting a hostile takeover of the market, so that it can continue to keep all the money in the hands of the super wealthy bankers and their puppet government regulators". So what is the open source part really worth? It's a distraction technique, a ploy to get you to look the other way and for them to come across as "legit" in the crypto world.

"Circle can be an issuer of US dollar coin, Square could be an issuer. If I got US dollar coins from Circle, I could transmit those to another digital wallet for an issuer," he explained.

😲

So let me get this straight: They are minting the equivalent of digital US dollars. Okay then...

Anyone see parallels between this and the Federal Reserve (you know, the private bank with a deceptively false government sounding name that controls the entire US money supply)? Okay, I guess it's just me then. (The Fed is discussed in far more detail in the posts I linked to in the intro.)

Allaire suggested that bolstering the exchange and fiat cryptocurrency ecosystems globally only strengthens products like its original mobile money application, enabling that product to work more effectively at scale in accordance with its original vision.

Trying to hold on to the fiat money power and control the new crypto money power. Wonderful!

Of note in these materials is that all USD-C tokens will be issued on ethereum, a notable detail given the platform's issues in scaling to support its current diversity of users. (The company said more announcements on the project are expected this summer).

That part surprised me. I'm not sure why they went that route. Was it ease of use and simple availability, or is it something more sinister? I will watch with great interest.

Still, the overall message was that this is an effort to bring an opaque offshore market back into the regulated cryptocurrency economy, as Allaire said CENTRE will require members to undergo compliance and balance sheet audits to ensure assets are properly backed.

But of course, they must retain maximum control through their well compensated government puppets. Regulation = control. And guess who those regulations always favour?

In this way, Allaire summed up his message succinctly, dismissing existing market alternatives as nothing more than clever "regulatory hacks."

There goes the old "character assassination" tactic. Oldest trick in the book and they still use it. Anyone heard "Bitcoin is dead" or "Bitcoin is a fraud" before? I thought so. Looks like we'll soon be hearing "Tether is dead/a fraud"!

He concluded:
"The CENTRE model is out in the open in a regulated context with real banking connectivity and that's really based on an open standard."

So basically banks linked to crypto. Old power extends its influence into the new.

Conclusion

This sounds evil. I'm staying well away from these companies and their centralised products. Look: the products will work, just like Ripple does, but I have no interest in supporting their "keep the rich rich and the poor poor" agenda, and neither should you. It's against everything that crypto stands for and its raison d'être.

Regulated crypto is not crypto, it's as good as fiat money (which is 98% digital anyway). "Regulated" just means that governments and banks can charge you fees and taxes. HE IS MAKING REGULATION OUT TO BE A GOOD THING AND DISMISSING UNREGULATED CRYPTO AS ILLEGITIMATE. THE TRUTH IS THAT THINGS ARE THE OTHER WAY ROUND!

Ladies and gentlemen this post is just one example that I have chosen, albeit a big one. There are others. WATCH OUT for the marketing hype, beware the suggestively worded articles like the one referenced here. Check under you bed at night for centralised crypto!

And grow eyes in the back of your head...

Yours in crypto,
Bit Brain

DISCLAIMER:
I am neither a financial advisor nor a professional trader/investor. This is not financial advice, investment advice or trading advice. Unless otherwise stated, all my posts are my opinion and nothing more. Crypto is highly volatile and you can easily lose everything in crypto. You invest at your own risk! Information I post may be erroneous or construed as being misleading. I will not be held responsible for anything which is incorrect, missing, out-of-date or fabricated. Any information you use is done so at your own risk. Always Do Your Own Research (DYOR) and realise that you and you alone are responsible for your crypto portfolio and whatever happens to it.