*Qrafty preparing and rolling the red carpet for your arrival* Ahoy, digital matey! It’s a beautiful day to be alive and I, Qrafty the crypto lovin’ honey badger, welcome you to Coinqraft, the juiciest crypto digest in town – a treasure chest of crypto gems for the savvy and the inquisitive.

🦡 Qrafty just got back with news and scoops from the crypto chaos , so let’s sip on the freshest crypto kool-aid…. I mean crypto juice – because ain't nobody got time for those crypto rabbit holes! 🥤🔍

Today’s Story

The Case for Bitcoin as a Reserve Currency or How Bitcoin eliminated human labor from the equation/formula of currency

Qrafty would like to take you to a trip through the history of banking. It’s going to be long, sweet and (Qrafty hopes) fun! 💰💰💰

And it’s going to take Qrafty more than one edition to finish it, so please know that this will be a series of articles on the history of money and how bitcoin has eliminated human labor from the equation of money.

💰🏦 🏛️ Once upon a time, before debit cards and app payments, the OG bankers were the merchants of the world! They were the alpha version of banks as we know them today.

What did they do more specifically, Qrafty?

Around 2000 BCE, throughout Assyria, India and Sumer these merchants would give out loans as grains, to farmers and traders who hopped from one city to the other.

Think about it like this: the farmers would ensure production of said grains into raw goods (like wheat, corn, etc.) and the trader would ensure the distribution of those raw goods in human agglomerations known as villages or towns.

And the merchants is the middle-man that buys the production from the farmer(s) at a humiliatingly low price, stores it and distributes it either directly or through intermediaries, like traders, at a markup.

Why didn’t they use money, Qrafty?

Because the society being mostly agrarian and the number of farmers predominant, mostly barter was used. There were some metals discovered that were used as a form of currency, all the way back to 5,000 BC.

But because farmers didn’t really know how to write or never had access to education, barter was more accessible. And also because a farmer’s production is his/her main currency.

Which means that human labor was directly tied to money. Remember that.

So barter meant that in a deal with two parts, each part would use its own currency (one would have wheat and the other, tomatoes) and they would agree on the exchange value for these items among each other.

So if we agree, then that is the same for others?

Nope, that’s called negotiating. Now you might understand why it was so subjective and localized. The same sack of wheat could be 1 sack of corn here, 1 and a half in the next village and maybe you won’t reach the next village because you barely escaped with your life while on the road, by a pack of bandits who wanted the goods from your cart and your two horses. Yup, there was that too… and a LOT more!

So what happened after the barter, Qrafty?

Well… you’re going to love this… during Ancient Greece and the Roman Empire times, you would get lenders and money exchange services in …

**** the crowd is buzzing with excitement and some might be about to start throwing tomatoes at Qrafty…****

TEMPLES! Si senor, temples as in the keepers of faith and renunciation from all that is material, right?! Off to the temple for a sin-scrubbing session! Taking my guilty conscience and a pocketful of coins for a divine two-for-one deal: repentance and currency exchange. 🙏💰😇

All joking aside… well not really but anyway… the lenders in the temples would also offer deposit services and loans, aside from currency exchange.

Qrafty doesn’t want to be snarky and must also reveal that churches and temples were always the keepers of knowledge and wisdom, aside from the connection with God. Not just the divine knowledge, but the books and basic accounting services required to manage a community, from the early ages of civilization.

Why in temples and churches, Qrafty?

For two reasons, but mainly because back in the day, peasants and most other social classes weren’t educated and couldn’t read or write. They would use their finger or thumb to sign documents or forms.

And monks and priests were the only ones who could read and write, since they were either translating or creating other books all the time. Plus, churches were usually safe harbor spaces and even in wars were not to be damaged. Well… most wars.

Got it Qrafty… so what happened next?

Qrafty thinks you’re going to like this 😁

After the collapse of the Roman Empire around the end of the fifth century, things were pretty nasty for a while, to put it mildly… Trade was mostly done in coins and something resembling IOU’s for larger trading quantities. Those coins were similar to the sh*tcoins trading on crypto exchanges and weren’t reliable at all.

But then, guess what? The Italians brought style to banking, baby! Whooop Whoop! Around the late 13th century, the wings of Renaissance were spreading in the Italian city of Florence and in the hearts and pockets of the potent.

You see… the cities of Venice, Florence and Genoa were making big, BIG dinero from trade. Some families are even famous to our time, like the Medici family. So they needed a system to organize all that cash and so, the merchants turned into bankers!

So, now banking went from alpha stage to V1, to what triggered the Renaissance era, a fabulous page of human history. One of the highest expressions of the human spirit that we have ever recorded, a sublime adoration of that which can be perceived with the senses and beyond them.

Qrafty, are you high?

Only high on love, baby! But no, not really. Just standing in awe at the remarkable achievements of humans!

And… you know… the seeds of Renaissance led to the spark of Enlightenment, which lit the light of the scientific method that slowly but surely, over time, led you to read Qrafty’s history of money on the magical device you are holding 🙃 

Qrafty will continue the story in the next edition 💰💰💰

🙃 Qrafty hopes that you liked today’s first part of the story! Now it’s time for a break, you deserve a bit of fun! 😇 👇️ 

Did you know that today is National Relaxation Day?

While most of the time you get to see posts that say… “don’t be this guy”, today it’s the exact other way around! Be this guy!

A good giggle… priceless. For everything else there’s… laughing hysterically.

Here are the main news of the day

1. Fitch just started the downgrade show 💣️ 

Downgrading US was just the beginning? They dove into that downgrading like a cat avoiding a bath – with all the enthusiasm of a sloth on a Monday morning! Who’s next? It’s not just about countries, it’s about companies and banks too! This might be getting fun! Qrafty getting 🍿

After Fitch initially downgraded US from AAA+ to AA+ and Moody’s downgraded the ratings of 10 banks by one notch while placing other 6 banking giants on watch for potential downgrading, now Fitch is saying that they might downgrade US banks.

How so, Qrafty? Why?

Fitch says that it might downgrade the whole US banking environment. Qrafty already wrote an opinion about the Fitch downgrade, check it out if you want!

Obviously, if the whole banking environment is downgraded, the US banks are up for review. In June, Fitch already lowered it from AA to AA-.

If it goes one more story down, to A+ that means that Fitch will be forced to downgrade the banks.

Which, in turn, will bring a whole world of trouble for pretty much everyone, as usual.

2. 52 years ago today, US President Richard Nixon decoupled the USD from gold

We are living historic times… as we might be facing another potential financial big event. Qrafty is also thinking about BRICS and how the use of the USD is slowing down in oil transactions. Is it possible that all the US issued become a too heavy monetary mass for an ecosystem which doesn’t require that much USD anymore?

Is it possible that this inflation might be stubborn and current market conditions worsen, which would lead to a scenario where a digital USD is needed, maybe even backed by gold? Even funnier and unlikely, by Bitcoin?

What would that entail, Qrafty? 

That the US FED buys or controls the majority of the bitcoin and especially the mining power for it, or what is known as the hashrate. But that can lead to an energy war and it’s really much easier to issue a CBDC. 1 is easier to defend, it you get the drift.

Ok, but what does Nixon have to do with crypto, Qrafty?

There are voices saying that crypto is “decoupled“ from the market because they saw a recent chart. Qrafty believes that is either naivete or intentional malevolence. For those thinking that the crypto market has reached any level of maturity, whatsoever, please think again and don’t be carried away by fortune tellers; don’t even listen to Qrafty, please use your own mind.

If TradFi is in trouble, where is the liquidity for crypto coming from? Banks are still the gateways for entrance in crypto. Unless someone’s buying secretly and injecting liquidity, highly unlikely that crypto will stand on its own with the exception of an event where nobody will accept to sell under a certain level. Literally nobody. Which is close to impossible.

3. FarmVille creator, Zynga, gets on the Web3 train with SugarTown

Hold onto your joysticks, folks! Zynga, the mobile game developer under Take-Two Interactive's wing, just dropped a digital bombshell: they're diving headfirst into Web3 with their brand-new game, Sugartown.

Zynga isn't just dipping their toes, they're cannonballing into the Web3 pool, crafting Sugartown from scratch. Ethereum's the playground, where players snag rewards in a digital dreamland.

Within the game's realm, players wield their ERC-721 Ora tokens like keys, granting entry to Sugartown's wonders. Through clever Oras staking, energy perks up, ready for action in Sugartown's games, fueled by Sugar – the groovy in-game currency unlocking awesome prizes.

Qrafty wishes them good luck, their website looks really nice and it seems that it’s some really great work on the visuals!

4. Visa makes it easier to pay for gas on ETH network

Visa's crypto power move – paying Ethereum gas fees with Visa cards – is like getting a high-five from the future. They're winning, Ethereum's dancing with easier access, and the crypto party's getting a mainstream VIP lane. It's like giving crypto a stylish makeover while Visa rocks the fintech runway.

The result? Ethereum's flexing its muscles, Visa's the cool kid in crypto town, and we're all taking a wild ride toward a financial future where everyone's invited to the blockchain bash! 🚀💳🎉

5. Michael Burry is shorting, but it’s not really like that

A lot of talk in the crypto jungle that Michael Burry is shorting the market. So on this new episode of “hey, Twitter’s gone crazy again”, here are the few things you need to know about this. It’s short and sweet:

• This happened last month, at the end of June. Since then, he might have sold. This info is coming from his company’s quarterly report.

• Burry didn’t buy $1.6 billion worth, that’s the notional value, it’s leveraged.

What’ the difference between notional and real value, Qrafty?

It's like bragging about having a pet dragon, but when you unveil it, turns out it's just a house gecko wearing a fancy cape. Size tales vs. reality strikes again! 🦎🐉 Qrafty had a different comparison in mind, but can’t write it here…

You can build a $1,000,000 trading position with just $100,000 capital by using a leverage of 10x. Get it?

So Burry didn’t actually spend $1.6 billion to short the market. Qrafty doesn’t know how much he did spend, but it definitely wasn’t that.

Who’s Michael Burry, Qrafty?

He’s the guy who shorted the market in 2007 before the crash; he’s also the character played by Christian Bale in movie “The Big Short“. He made it big from that 2008 toxic credit crash and now he’s basically saying: the market’s about to go down again.

What did he actually do?

He bought put options against the S&P 500 and Nasdaq 100. It’s like saying: hey, I believe that the value of these two tickers (S&P 500 and Nasdaq 100) will be going down in the following period.

So I will buy these contracts called put options, which will appreciate in value if I am correct. If I am incorrect, their value will go down as the S&P500 and Nasdaq 100 will appreciate.

Just to be clear, as most publications want to create emotions with their titles. Michael Burry bet that these two tickers will go down. That doesn’t mean the market is going to crash. They might drop a bit, a bit more, but not necessarily go to a “omfg economy ded” level, mkay?

Also, he’s doing this because of the Moody’s and Fitch downgrading the US and the US banking environment. For those who have been paying attention to the movie, this is the same path that we walked on in 2007. He went and talked to rating agencies and realized the mess hidden under the rug which led him to short. Also he went to ask prostitutes about their investments… but you should see the movie.

Will the scenario repeat? 🍿🍿🍿

Finally, here’s what is Michael Barry invested in:

6. Sam Bankman Fried was supposed to speak at Stanford about tech ethics

Yes, seriously. In a editorial in “The Stanford Daily“, more details transpire about the connections to this case.

Of course, suddenly eyes are wide sh… open and all the connections are discovered a bit late and a bit tardy, but maybe better late than never.

Hey hey 🙃 Qrafty hopes you are enjoying the experience here and would like to regularly get Qrafty’s letters!

If so, please click on the button below. Qrafty is really really grateful to have you here, so thank you!

Qrafty’s thought of the day

Everyone seems to have forgotten about the past three years. Over the interwebs, people are talking about the market recovering. The gentleman at Chase, Jamie Dimon, said that we’re not in for a recession anymore, just a soft landing and mild stagflation for a while.

Qrafty talked about this before.

The initial downgrade didn’t really made a dent in the markets the day of the announcement and you were mostly busy being told that everything is ok and that Fitch are being meanies. But the next few days in the markets told the true story and it might be time to pay attention.

Also, Moody’s and Fitch have downgraded the US, the US banking environment and a few US banks. And they talk about the possibility of downgrading more.

The past three years were filled with government financial debauchery in all countries and the bills haven’t been paid. The dirt is under a rug, but we’re not being shown the rug, just the other rooms of the house where it’s tidy and clean. But the attic is filling with crap every day and Qrafty thinks it might crash the entire house. Qrafty isn’t trying to cause panic, just attention.

Other stories worth throwing an eye on (or two, ideally)

• Bitmain will launch improved mining equipment

  Bitmain, the Bitcoin mining equipment manufacturer, is planning to launch its Antminer S21 miners at the World Digital Mining Summit in Hong Kong, in September later this year.

• Prime Trust files for chapter 11

  A crypto custody company named ironically Prime Trust has filed for chapter 11 bankruptcy since they haven’t been able to honor customer withdrawals for months.

• Binance is suing the SEC

  In a new twist of the telenovela, Binance is suing the SEC. The exchange is basically claiming that the SEC is being a bully during the discovery process and seeking a protection order from the Court.

  Simply put, Binance is claiming that the SEC are requesting far more documents then they might need for the scope of their investigation.

• U.K.’s approval rating for crypto projects is really low

  British authorities approve 38 out of 200 crypto applications

  Qrafty doesn’t know exactly if it’s the brits who don’t have crypto at heart or if it’s the brits who can’t apply correctly for their projects or a combination of both.

• Filecoin mining operation in China accused of being a scam

  A Chinese Filecoin mining firm is accuse of creating an $83 million pyramid scheme. They’re being investigated.

  The actual problem is that crypto is banned in China. These guys were basically asking people to fund the mining pool operation, where more people pool together funds to mine more coins because of the increased hashing power.

  But with the Chinese system, they are being charged.

• SEC is suing a UK company for falsehoods 

  And it might spill into crypto too

Market Whispers

BTC - looks like it wants to touch again Monday’s low.

Monday’s high is in confluence with previous range low, so getting acceptance back above Monday’s high will give some hopes for more upside!

Bitcoin is ded every few years in the public opinion… don’t fall for that.

That’s all of Qrafty’s wisdom for today! Qrafty thanks you and wishes you to live each moment as if you are listening to the music you love most! Wahaha!