BTC New Reserve Currency!? This Bitcoin Report Is CRAZY!!

There are three reasons why people adopt Crypto for fun for speculation and out Of necessity in many parts of the world Crypto adoption is happening because of The third reason typically because Fiat Currencies are losing value or because Governments have imposed strict Capital Controls a recent report by one of the World's largest financial institutions Reveals how much crypto is being used Out of necessity today we're going to Summarize it and tell you what it means For the crypto Market the report that we'll be Summarizing today is titled a primer on Bitcoin cross border flows it was Published by the international monetary Fund or IMF an unaccountable and Unelected organization that is Infamous For giving out US dollar loans to Developing countries with lots of Conditions attached this is significant Because organizations like the IMF see Cryptocurrencies as a threat to the US Dollar based Fiat Financial system that They promote and they preserve the fact That the IMF is examining btc's use in Crossb transactions suggests it's Concerned about btc's use in this Context we'll come back to that a little Bit later by the way the full report Will be in the description if you are Interested now the report begins with a Brief introduction to bitcoin not

Surprisingly the authors fail to make The distinction between Bitcoin the Network and BTC the cryptocoin that Pumps and dumps to be fair this is a Distinction that most people fail to Make even in crypto that's why we have Been repeating it moving on the authors Then note that the blockchain technology That is underlying the Bitcoin Network Implies that BTC the cryptocurrency is Frequently being sent around the globe The thing is is that it's difficult to Figure out just how many BTC Transactions are related specifically to Crossborder flows the authors explained That this is due to both the Pseudonymity of the Bitcoin blockchain And also the fact that many BTC Transactions take place offchain on Places such as exchanges for those Unfamiliar pseudonymity means that the Data is public and viewable but not Connected to personal information news Flash but BTC And most cryptocurrencies are not Private or Anonymous merely pseudonymous Anyways given these facts the IMF Reports authors employed multiple Onchain and offchain measures to try and Assess just how many BTC transactions Are going across borders they reveal Something interesting yet intuitive and That's that crossborder BTC transactions Behave differently from regular BTC

Transactions obviously this means that Crossb transactions for BTC are easy to Identify so how many of them are there The authors give a teaser and that's That the total value of BTC being sent Across borders is larger than the GDP of Many countries notably crossb BTC Transactions appear to be larger on Average what's fascinating here is that The authors also touch on some of the Research that they have already done on This topic they cite a previous study About flows between BTC and the Chinese One and found that BTC CNY flows Fluctuate based on what's going on with Capital controls suggesting Capital Flight they then site another more Recent study which found that BTC is Increasingly being used as a tool to Send remittance and invade Capital Controls in developing countries they Reveal that this has resulted in more Research into btc's use to evade Capital Controls seemingly confirming that the IMF is focused on it as you might have Guessed the authors note that while Btc's crossb flows are still small Relative to Fiat currencies btc's Adoption and crypto's evolution are Increasing fast and this means that lots Of data is needed to and I quote Targeted policy response in the future In other words the folks who control The Current financial system are starting to

Get nervous about people using BTC and Crypto to circumvent current and future Capital controls make no mistake Capital Controls will be implemented in Developing countries too if the Situation gets bad enough this Underscores another thing that we have Been repeating and that's that the Financial Freedom does not mean having Lots of money it means being able to do Whatever you want with your money Whenever you want and in case you didn't Get the memo this is only truly possible With decentralized cryptos like BTC and Money Commodities like gold by the way If you're enjoying the video so far be Sure to smash that like button and give The video a boost and be sure to Subscribe to the channel and ping that Notification Bell so you don't miss the Next one now in the second part of the Report the authors explain exactly how They track btc's crossborder Transactions using onchain and offchain Data they start by noting that previous Research found that btc's onchain volume Is slightly larger than offchain volume But don't specify by how much they then Say that there are three types of crypto Exchanges centralized exchanges Peer-to-peer exchanges and decentralized Exchanges this is a bit odd because it Implies that peer-to-peer exchanges and Decentralized exchanges are offchain

Which depending on the circumstances Isn't always the case say speaking of Exchanges did you know that the coin Bureau deals page has tradeing fee Discounts of up to 60% and sign up Bonuses of up to $60,000 on some of the Best crypto exchanges these deals are Only available to the viewers and won't Be around for long so take advantage of Them using the link down below now in Any case the authors then go on to Explain that they began analyzing btc's Transaction data by identifying which Bitcoin wallets belong to to exchanges They did this using a mix of previous Research and publicly available data Note that most blockchain explorers will Know which wallet addresses belong to an Exchange in the end they were able to Determine that 5% of the Bitcoin wallet Addresses that analyzed belonged to no Less than 80 crypto exchanges which Collectively sent and received more than 1.6 million BTC transactions naturally The Next Step was then to assess which Countries these exchanges are based in Once again the authors use a mix of Previous research and publicly available Information to figure out where all 80 Crypto exchanges are based then they use Data from chainalysis to assess where The Bitcoin wallets transacting with These exchanges are based FYI this is How they can track you more about that

In the description now moving on finally The authors use data from the Peer-to-peer BTC exchange local Bitcoins To see where Fiat currencies fit into The picture this data set contained Information about 40 million BTC Transactions involving 136 Fiat Currencies between 2017 and 2023 and Applied an algorithm to filter by Country if you're a bit lost the authors Provide this useful infographic showing You what aspects of onchain and offchain Data they analyze You recall there are three onchain chain Analysis and local Bitcoins together They provide the necessary data to get a Sense of btc's crossborder transactions This ties into the third part of the Report which analyzes btc's crossborder Transactions the authors start by adding Another important statistic to the mix And that's regular cross Capital flows Which they measure using trafi data and Which even they admit isn't the best Hm regardless they found that the Average onchain size of crossb BTC Transactions is over 13 BTC compared to An average of roughly 0.02 BTC of Offchain as you might have guessed the Average size of both onchain and Offchain BTC transactions has been Falling over time as btc's price has Been rising the authors also found that The largest cross border BTC flows

Occurred in parts of Latin America Eastern Europe Asia and Africa the heat Map shows where crossb BTC transactions Are happening the most it is eye Openening as it reveals just how much of The world seems to be using BTC it gets Even more eye openening when you Consider the author's third finding Which is the enormous size of these Crossb flows in relation to the GDP of The countries involved the heat map for This can be seen here it paints a clear Picture some BTC flows account for Almost 2.5% of a country's GDP to their credit The authors did some extra analysis to See whether macro and crypto factors Played any role in these crossb BTC Flows this relates to the fourth part of The report where the authors did an Empirical analysis to assess just how Similar BTC flows are to standard cross Capital flows they found that while Cross Capital flows are impacted by Macro factors like a strong US dollar Crossb BTC flows effectively aren't they Believe this is because most crossb BTC Flows are likely related to remittances Or Capital controls which don't really Care much about what the FED are saying Or doing conversely crypto factors like Sentiment had an impact on crossb BTC Flows and even had had a minor impact on Some standard cross Capital flows this

Suggests that there must be a big Overlap between trafi investors and BTC Investors somewhere which makes sense But is still a surprising finding Another crypto specific factor that Seems to influence crossb BTC flows is The parallel premium which is basically The difference between BTC prices in Exchanges the authors note that when the Parallel premium Rises crossb BTC flows Increase this again suggests Capital Control Evasion the authors say this is very Likely because a change in btc's Parallel premium is correlated to lower Inflows for tradire Assets they know that the underlying Factor causing this link between BTC and Trad fight assets is exchange rate Differentials and that is the sudden Change in the price of Fiat currencies In the final part of the report they Conclude that based on their admittedly Limited data there are lots of Crossboard BTC transactions and most of Them are very large they highlight the Fact that onchain transactions are the Elephant in the room and that both types Point to Capital control evasion they Know that these findings are consistent With findings on a recent report and Point to an IMF paper published back in 2023 3 which effectively advise Countries with strict Capital controls

To crack down on crypto they admit that Btc's crossb flows may not be entirely Related to Capital controls instead they Could be related to plain old exchange Rate volatility for reference most Fiat Currencies aren't that stable they're Just stable relative to other Assets in Relation to the US dollar even then There have been some major fat Currencies like the Japanese Yen that Has fallen by double digits in months The authors advise any Central Bankers Or any government officials reading to Minimize this exchange rate volatility Presumably because it likewise results In more BTC and crypto adoption funly Enough the authors don't advise that They improve their trafi Capital inflows But that seems to be another factor to Clarify the authors found that try Capital inflows were in inversely Correlated to crossb BTC flows the Higher the trafy capital inflows a Country had the fewer crossb BTC Transactions there were this suggests That people without access to a good Trfi Market are invested in crypto Instead on that note the authors caution That the recent approval of the spot Bitcoin ETF could essentially Supercharge btc's adoption and use in Other contexts in the future presumably Due to its price effects they warned That and I quote this user convergence

Could certainly complicate policy Responses translation the spot Bitcoin ETFs will increase BTC adoption more Generally and the IMF doesn't like it if That wasn't spooky enough the authors Seem to suggest that every BTC Transaction ought to have kyc attached To it someday so that adequate policy Can be implemented to mitigate its Adoption before I tell you about what This all means for the crypto Market I Want to go back to that 2023 IMF paper That was cited by the authors about Proposed policies related to crypto and Capital controls that's because it Reveals there's an agenda behind the Report we just summarized the agenda we Mentioned earlier to refresh your memory The purpose of the IMF is to promote and Preserve the dollar-based Global Financial system that we have today it Sees BDC and crypto as a threat to this Financial system so much so that it's Even come up with a term meant to show The ills of crypto adoption Cryptoz the citing of the IMF 2023 paper Is a dead giveaway that there is an Agenda because the policy Recommendations were published before Most of the reports cited the authors About btc's use in evading Capital Controls they started with the Conclusion and then produced the data Just to justify it this is where things

Get scary because the IMF paper cited by The authors of this report doesn't even Contain a policy recommendation about Btc's use in evading Capital controls The only mention of capital controls Falls under a warning that mass crypto Adoption will make monetary policy less Effective this is scary because it Implies that Capital controls will be Used to ensure that monetary policy Remains effective if you watch our video About the man who predicted everything You'll know that he thinks this is Exactly what's going to happen countries Will impose Capital controls to manage Their debts you might also recall that He believes that governments around the World will crack down on BTC precisely Because it can be used to evade these Capital controls the caveat is that the IMF doesn't seem to be concerned about BTC at least not yet from the IMF Perspective stable coins are a bigger Threat per the 2023 paper and I quote The transmission of monetary policy Would weaken if firms and households Prefer to save and invest in crypto Assets that are not Peg to the domestic Fiat currency the risk of currency Substitution is particularly pertinent For countries with unstable currencies And weak monetary framework cryptoz is More likely to be associated with the Adoptions of stable coins denominated in

Foreign Currencies in case you haven't noticed This is why we've seen stable coin Regulations pop up around the world Every country that isn't already Dollarized is terrified of its domestic Currency being replaced by a de facto Digital dollar at the same time they Need to find some way to subsidize their Growing debts that's why not paid to the Domestic fiat currency is the most Important part of that quote it doesn't Mean that stable coins will be banned Entirely rather it means that it will Only be possible to issue a new stable Coins that are pegged to a country's Domestic currency these would all be de Facto Cbdcs this brings me to the big question And that's what all of this means for The crypto Market namely BTC in short It's both bullish and bearish for Contexts the IMF has never considered BTC to be a currency it has explicitly Avoided using the term currency to drive Home the fact that it is not a currency However the report we summarized today Along with the other recent reports it Sites suggests that the IMF is starting To wake up to the fact that BTC is being Treated as a currency by millions of People around the world although this Doesn't mean that BTC is a currency it's A big step in that direction this means

That the IMF has has no other choice but To start treating BTC as a currency in Its policy recommendations or at the Very least as an asset that has economic Significance internationally remember That crossb BTC transactions account for As much as 2.5% of some Count's gdps never mind the Possibility that some of these crossb Transactions are actually crossborder Trades this is bullish because it's Proof that Bitcoin adoption is growing Not just BTC speculation but it's also Bearish because this growth is starting To catch the attention of the likes of The IMF just like stable coins did when They became front and center during the Last crypto Market cycle due to their Rapid growth of course the Catalyst for Attention in btc's case is the approval Of the spot Bitcoin ETFs in the US and What's likely to be the approval of the Spot Bitcoin ETFs in every major Economic area around the world these ETFs will not only increase btc's price But also lower its volatility making it More currency like if we can see this Coming you can bet that the IMF does too That's probably why it's being proactive By letting central banks and governments Around the world know that BTC could Soon become a tool to evade their Inevitable Capital controls and unlike Stable coins they can't freeze BTC

Transactions in case you miss the memo Stable coins like uscc can and have been Frozen by their issuers anyhow this all Pertains to the other crypto regulations Being pushed by other unaccountable and Unelected international organizations Such as the financial action task force To bring you up to speed these so-called Recommendations involve making it more Difficult to do things on Chain by Labeling such activities as high risk we Are already seeing these regulations Come into play with restrictions around Crypto wallets and added data collection When withdrawing from depositing to an Exchange these restrictions will only Get worse the Silver Lining is that they Will simultaneously allow for more Capital to flow into crypto with that in Mind you start to wonder if the spot Bitcoin ETFs are ultimately a troan Horse to make BTC another Triad fight Asset that can only be transacted Offchain then again the spot Bitcoin ETFs could just as easily be a troan Horse to make BDC another Global Reserve Currency that competes with the US Dollar I guess we're about to find out Either Way and that's all for today's video If You learned something new be sure to Smash that like button and let us know If you want to keep learning subscribe To the channel and ping that

Notification Bell if you want to help Others learn about how BGC is being used Besides speculation share this video With them as always thank you so much For watching and I'll see you all in the Next one this is Jessica signing off [Music]


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