Friday, December 9, 2022

Cardano Daily Discussion - December 10, 2022

Hello everyone,

Welcome to the Cardano Daily Discussion!

The standard sub rules apply here (see sidebar), with the exception that price discussion is allowed in this thread, though we encourage you to try not to make this the focus and talk about the project itself. Please ask questions, help others and be civil - be sure to get involved in Project Catalyst too!

If you're new, please make sure you're read through the newbies guide and share it with others (use the ?newbies comment command to reference it).

⚠️ Scam Warning ⚠️

Please read the Cybersecurity guidelines for Cardano Users.

There are ongoing giveaway scams on youtube and many scammers lurking in Cardano's social channels impersonating ambassadors/moderators/official staff contacting users via direct messages.

For example, searching 'cardano' on youtube and sorting by most recent upload date shows several giveaway scams running (all videos in screenshot are scams):

Ongoing 'giveaway' scams on Youtube

The youtube scams are automated; use stolen footage usually of Charles Hoskinson and are restreamed so to appear to be 'live'; appear to have many watchers (which are bots); use bought hacked channels and are edited to appear like official channels.

Do not be fooled!

To be clear:

  • ⚠️ There is no such thing as a Cardano giveaway
  • ⚠️ Never share your seed phrase with ANYONE
  • ⚠️ Never send ADA to someone promising to send you more ADA back
  • ⚠️ You will never be contacted by ambassadors/moderators/staff

Please report scams on the Cardano Fraud Detection Bureau.

⚠️ Scam Warning ⚠️


Explaining the GBTC discount

GBTC is a company/stock that does just one thing: it owns Bitcoin.

HOWEVER, you would think if it owns $100 worth of Bitcoin it would have a market cap of $100. But it doesn't. It is trading at a 50% discount. For every $100 of Bitcoin it owns it is trading for just $50 of that.

This doesn't mean it's a sell or buy but many people are curious why this is and there is a lot of misinformation about this. Note again: I am not recommending one way or the other. Just explaining.

There's an entire category of stocks that trade at discounts to the assets they own and GBTC is one of them.

They are called closed end funds. Closed end funds typically own municipal bonds and pay out hefty (often tax-friendly) dividends.

They often trade at a 10-15% discount to the assets they own (a discount to their "net asset value" or NAV).

An example is BlackRock California Municipal Income Trust , which trades on the NYSE. Note: I am NOT recommending it either way. Just using it as an example.

They trade at a 15% discount to their NAV. Earlier this year, they traded at a 9% discount.

A VERY TYPICAL HEDGE FUND STRATEGY: is to buy CEFs that are trading at a statistically significant discount to NAV compared with their average discount to NAV.

Because then there are three ways to make money:

a) the discount becomes less so the stock goes up even if the value of the assets remain the same.,

b) the value of the assets go up plus you have a buffer in case they go down (because of the discount)

c) if they have a higher than usual discount, you get a higher than usual dividend.

Also, very important, if an activist hedge fund feels the discount is too much they will buy a bunch of shares and force the closed-end fund to turn into a mutual fund. Mutual funds are valued once a day and ALWAYS have a 0% discount.

Since closed-end funds trade like stocks, their price is determined by the supply and demand of shareholders, which is why they almost always trade at a discount to the NAV. So forcing a CEF to become a regular mutual fund removes the discount instantly and is a successful way that some hedge funds operate. I have previously invested in hedge funds like this.

GBTC is trading at a discount because:

- interest in BTC has severely lessened over the past year so there were many more sellers than buyers of GBTC

- People are only willing to hold right now if there is a good buffer for risk against another FTX or any other event that could drive BTC 50% down or more.

If you feel the discount is irrational, then you buy. If you feel it's rational then you leave it alone. If you feel BTC could go down more than 50%, then you would short although 50% is a pretty big discount.

In general, the strategy of buying CEFs at a big discount is a very solid strategy in dark times.

A) because they mostly hold municipal bonds, which very very rarely default.

B) If you buy when the discounts are big, those discounts are usually irrational. Like when there is a panic (e.g. in 2008-9 or in March, 2020).

C) it's good to check if other hedge funds are buying. Then you might see an activist fund buying so you can piggyback them.

Helpful resources:

cefa.org to filter closed-end funds by discounts, etc.

j3sg.com to see what other hedge funds are accumulating.

Good luck with GBTC! I hope this explains things. If you have questions, ask and I will answer.


I let chatgpt write a screenplay for Buttcoin the movie

FADE IN:

INT. CRYPTO CONFERENCE - DAY

We see a chaotic scene of people frantically running around, shouting and waving their arms. In the background, we hear the sound of sirens.

CUT TO:

A close-up of MAX KEISER, a well-known Bitcoin advocate, as he rips a dollar bill in half and shouts, "It's going to zero! Buttcoin is the future!"

CUT TO:

CARLOS MATOS, another Bitcoin enthusiast, is on stage yelling, "Bitconnect! Bitconnect! Bitconnect!" as the crowd cheers him on.

CUT TO:

SAM BANKMANN FRIED is on a video call, explaining yield farming as MATT LEVINE's voiceover says, "Well, I'm in the Ponzi business, and it's pretty good!"

CUT TO:

A group of people are huddled around a computer, staring at the screen in amazement. One of them, JIMMY, stands up and shouts, "We just made a million dollars in one day with Buttcoin!" The others erupt in cheers and high-fives.

FADE TO BLACK.

The words "Buttcoin: The Future of Money" appear on the screen.

FADE TO:

INT. CRYPTO CONFERENCE - DAY

The chaotic scene continues as people rush around, still excited and shouting. The camera pans to show the main stage, where a group of Bitcoin evangelists are holding court, preaching the gospel of decentralized money to a rapt audience.

FADE TO BLACK.

FADE IN:

INT. CRYPTO CONFERENCE - DAY

We see a series of clips showing various experts and analysts pointing out red flags about Bitcoin, such as its volatility, lack of regulation, and potential for fraud.

CUT TO:

A clip of a news report showing people lining up outside of a Bitcoin exchange, eager to invest.

CUT TO:

Interviews with various Bitcoin enthusiasts, expressing their excitement and enthusiasm for the cryptocurrency.

CUT TO:

A clip of a person, JIMMY, sitting at a desk, staring blankly at the camera. He looks devastated.

JIMMY:

I was a big believer in Bitcoin. I put all my savings into it, and I thought I was going to be rich. But then the price crashed, and I lost everything.

CUT TO:

A montage of clips showing people around the world losing money on Bitcoin, as the price plummets.

CUT TO:

JIMMY, still sitting at his desk, looking down in despair.

JIMMY:

I wish more people had warned me about the risks of Bitcoin. But everyone was just caught up in the hype. It's a hard lesson to learn.

FADE TO BLACK.

FADE IN:

INT. DARK ROOM - DAY

We see BITFINEXED, a shadowy figure, sitting in a dark room. His face is obscured, and we can barely make out his features.

BITFINEXED:

The whole mess started with Tether and the inspector gadget guy. You see, Tether is a cryptocurrency that's supposed to be pegged to the US dollar, but there's been a lot of controversy about whether it's actually backed by dollars or not. And the inspector gadget guy is a pseudonym for a person who claims to have uncovered evidence of fraud at Tether and its parent company, Bitfinex.

CUT TO:

A series of clips showing various news reports and interviews about the controversy surrounding Tether and Bitfinex.

CUT TO:

BITFINEXED, still sitting in the dark room, speaking in a low, ominous tone.

BITFINEXED:

This is just the tip of the iceberg. There are many other shady practices going on in the world of cryptocurrency. It's a Wild West out there, and a lot of people are getting hurt.

FADE TO BLACK.

FADE IN:

INT. CRYPTO CONFERENCE - DAY

We see JIMMY, the same person we saw earlier, still sitting at his desk. This time, he looks excited and enthusiastic.

JIMMY:

I made a million dollars in one day by investing in Shiba Inu coin! It was amazing. The price just kept going up and up, and I thought I was a millionaire.

CUT TO:

A series of clips showing the rise of Shiba Inu coin, including a tweet from ELON MUSK showing a picture of a Shiba Inu dog.

CUT TO:

JIMMY, still sitting at his desk, looking concerned.

JIMMY:

But then I realized all my money was in USDT, and that was a big problem. You see, USDT is a stablecoin that's supposed to be pegged to the US dollar, but there's been a lot of controversy about whether it's actually backed by dollars or not. And when the price of USDT started to fall, so did the value of my Shiba Inu coins.

CUT TO:

A series of clips showing the decline of Shiba Inu coin and USDT, as the prices plummet.

CUT TO:

JIMMY, still sitting at his desk, looking dejected.

JIMMY:

I learned the hard way that investing in cryptocurrency is risky. It's not for the faint of heart. You have to be careful, and you have to know what you're doing.

FADE TO BLACK.

FADE IN:

INT. CRYPTO CONFERENCE - DAY

We see JIMMY, the same person we saw earlier, still sitting at his desk. This time, he looks dejected and defeated.

JIMMY:

I learned the hard way that investing in cryptocurrency is risky. It's not for the faint of heart. You have to be careful, and you have to know what you're doing.

CUT TO:

A series of clips showing the controversy surrounding Tether and Bitfinex, including interviews with experts and analysts who raise red flags about the stability and legitimacy of the cryptocurrency.

CUT TO:

JIMMY, still sitting at his desk, shaking his head.

JIMMY:

Nobody could have known that Tether wasn't backed. There were no signs at all. It's just one of the many risks of investing in cryptocurrency. It's a wild and unpredictable world.

FADE TO BLACK.

FADE IN:

INT. DARK ROOM - DAY

We see BITFINEXED, the shadowy figure from earlier, still sitting in the dark room.

BITFINEXED:

As I mentioned earlier, there's been a lot of controversy surrounding Tether and Bitfinex. In fact, they were already fined by the New York Attorney General, who made it clear that at times, Tether was not backed by dollars.

CUT TO:

A screen showing a statement from the Attorney General, JAMES. The statement reads:

"Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines."

CUT TO:

BITFINEXED, still sitting in the dark room, speaking in a low, ominous tone.

BITFINEXED:

This is just one example of the shady practices that go on in the world of cryptocurrency. It's a Wild West out there, and a lot of people are getting hurt.

FADE TO BLACK.

FADE IN:

INT. CRYPTO CONFERENCE - DAY

We see JIMMY, the same person we saw earlier, still sitting at his desk. This time, he looks more serious and determined.

JIMMY:

I lost a lot of money when Tether and Bitfinex went under. But I'm not the only one. There are many other people who were affected by this scandal.

CUT TO:

A series of clips showing the controversy surrounding Tether and Bitfinex, including interviews with experts and analysts who raise red flags about the stability and legitimacy of the cryptocurrency.

CUT TO:

JIMMY, still sitting at his desk, looking determined.

JIMMY:

But there was one person who took action. The inspector gadget guy. You see, he's a pseudonym for a person who claims to have uncovered evidence of fraud at Tether and Bitfinex. And when he made this information public, it started the downfall of Tether.

CUT TO:

A series of clips showing the collapse of Tether and Bitfinex, as the prices plummet and people lose money.

CUT TO:

JIMMY, still sitting at his desk, looking grim.

JIMMY:

It's a cautionary tale. The world of cryptocurrency is full of risks and uncertainties. You have to be careful, and you have to know what you're doing.

FADE TO BLACK.

FADE IN:

A clip of the Buttcoin cartoon, showing various characters discussing the risks and uncertainties of the cryptocurrency market.

CUT TO:

NARRATOR, still standing on the stage, looking shaken.

NARRATOR:

It just goes to show that you never know what's going to happen in the world of cryptocurrency. It's a wild and unpredictable place. You have to be careful, and you have to know what you're doing.

FADE TO BLACK.

FADE IN:

INT. BUTTCOIN CONFERENCE - DAY

We see JIMMY, standing on a stage at the buttcoin conference. He looks dejected and defeated. The audience, made up of people from the old r/buttcoin subreddit, laugh and mock him.

NARRATOR:

As we've seen, the world of cryptocurrency is full of risks and uncertainties. And one of the biggest controversies in recent years was the downfall of Tether and Bitfinex.

CUT TO:

A series of clips showing the controversy surrounding Tether and Bitfinex, including interviews with experts and analysts who raise red flags about the stability and legitimacy of the cryptocurrency.

CUT TO:

NARRATOR, standing on the stage, speaking in a serious and somber tone.

NARRATOR:

But it was the actions of one person that ultimately led to the downfall of Tether and Bitfinex. The inspector gadget guy. You see, he's a pseudonym for Jean Chalopin, the head of Deltec Bank in the Bahamas. And it was Deltec Bank that held the assets of Tether and Bitfinex.

CUT TO:

A series of clips showing Jean Chalopin, the head of Deltec Bank, speaking at various conferences and events.

CUT TO:

NARRATOR, still standing on the stage, looking amazed.

NARRATOR:

And get this. Jean Chalopin made the information about Tether and Bitfinex public via a new cartoon called Buttcoin. Can you believe it? A cartoon was the catalyst for the downfall of Tether and Bitfinex.

CUT TO:

JIMMY, standing on the stage at the buttcoin conference, looking embarrassed and ashamed as the audience laughs at him.

NARRATOR:

But as we can see, the people of r/buttcoin are still lost and lonely, gathering at conferences like this one to reminisce about the old days when bitcoin was still the future of money.

INT. NEWS STUDIO - DAY

We see BITFINEXED, sitting in a news studio, speaking to a REPORTER.

REPORTER:

So, Bitfinexed, you've been vocal about your skepticism of Tether and Bitfinex. But I understand that you actually hold a considerable amount of Tether yourself. Can you explain why?

BITFINEXED:

Yes, that's correct. I actually bought Tether when they were less than a cent each, and I've been holding onto them ever since. To be honest, I treat them like little pet rocks. I don't have high hopes for them, but who knows, maybe someday they'll be worth something again.

REPORTER:

But isn't it risky to hold onto Tether, given all the controversy surrounding them?

BITFINEXED:

Of course it's risky. But that's the nature of the cryptocurrency market. It's volatile and unpredictable. And for me, holding onto Tether is a bit of a gamble. Maybe I'll come out ahead, or maybe I'll end up losing everything. But that's the risk I'm willing to take.

REPORTER:

But why do you think Tether has any potential at all?

BITFINEXED:

Well, I think that ultimately, Tether could end up being the future of money. It's a stablecoin, which means that it's pegged to the value of a real-world asset, like the US dollar. And in a world where cryptocurrencies are becoming more and more mainstream, stablecoins like Tether could end up playing a crucial role.

REPORTER:

Interesting. Well, thank you for sharing your thoughts with us, Bitfinexed.

BITFINEXED:

Thank you for having me.

FADE TO BLACK.

FADE IN:

INT. BUTTCOIN CONFERENCE - DAY

We see JIMMY, standing on a stage at the buttcoin conference. He looks dejected and defeated, as the audience laughs and mocks him.

Suddenly, a member of the r/buttcoin subreddit bursts into the conference, running and screaming.

MEMBER:

There's a new coin called Buttcoin, and it's getting a lot of traction lately! According to the people who invest in it, it's the future of money!

The audience at the conference gets excited, their faces lighting up with hope and excitement.

MEMBER:

We need to invest in Buttcoin! It's our chance to regain our purpose and meaning!

The audience cheers and claps, as the member continues to shout about the benefits of Buttcoin.

CUT TO:

An animation of two butts connecting, with the words "Buttconnect" written in big, bold letters. The audience is seen cheering and clapping in the background.

FADE TO BLACK.


prepper

Big Tech appears to be in for a rude awakening as the Federal Trade Commission flexes its muscles under the leadership of Lina Khan. The antitrust enforcer has voted 3-1 to block Microsoft's (MSFT) $69B deal for game developer Activision Blizzard (ATVI), making waves across the industry. The decision is a clear sign that Khan and her team at the FTC will be more aggressive in cracking down on the biggest U.S. tech giants, who frequently grow their influence or fight off upcoming challengers via acquisition.

What are the concerns? Simply put, the FTC feels that the tie-up between Microsoft - the company behind Xbox - and one of the best known game developers could harm competition. Activision's Call of Duty and World of Warcraft are some of the most popular gaming franchises, and turning Microsoft into the No. 3 gaming company in the world could limit rivals' access to titles or raise prices for other gaming platforms. The FTC also said it would give the Xbox maker an unfair advantage in the new market for game subscriptions, as well as the emerging market for cloud gaming.

Microsoft has gone to great lengths in recent days and weeks to assuage the fears, like inking a deal to bring Call of Duty to Nintendo (OTCPK:NTDOY) for the next decade. A similar offer to Sony (SONY) on same-day access to the game on its PlayStation platform has so far been rebuffed, but the Xbox maker remains "committed to helping bring more games to more people - however they choose to play." Microsoft President Brad Smith has also been spotted in Washington, meeting with lawmakers to argue that the deal would "create more opportunities for gamers and game developers."

Go deeper: The U.S. is not the only jurisdiction where Microsoft might have to fight, as the transaction is also seeing in-depth reviews in Europe and the U.K. While the company initially took the concessions route, it now looks like it will be presenting its case in court. Prepare for a drawn-out battle that might include precedent of so-called vertical deals, whether withholding games from platforms would be profitable and whether Microsoft has made good on its past promises. The tech giant has also been in the antitrust spotlight before in a landmark DOJ suit from 1998, which saw Microsoft agree to modify some of its business practices. (89 comments)

New disclosures

The U.S. Securities and Exchange Commission has revealed new guidance that could require publicly-traded companies to disclose to investors any potential impacts from the troubled cryptocurrency market. Moreover, firms may need to share information with their investors regarding their crypto holdings, as well as their risk exposure to bankruptcies in the emerging space. Lastly, they should consider risks pertaining to a company's liquidity position, according to the guidance.

Backdrop: The latest development comes after the once-mighty crypto exchange FTX filed for bankruptcy protection in November. Traders rushed for the exit en masse upon discovery of its multi-billion dollar balance sheet shortfall, marking its demise as the industry's most high-profile downfall. FTX is facing a number of federal investigations, including by the SEC, while the mess sent shockwaves through the crypto ecosystem and caused high-profile crypto lender BlockFi to file for Chapter 11.

"Recent bankruptcies and financial distress among crypto asset market participants have caused widespread disruption in those markets," the SEC's Division of Corporation Finance wrote in a sample letter. "Companies may have disclosure obligations under the federal securities laws related to the direct or indirect impact that these events and collateral events have had or may have on their business."

Go deeper: The crypto market downturn has been highlighted by huge drawdowns in some of the largest digital tokens by market cap, including Bitcoin (BTC-USD) dropping some 70% from its November 2021 all-time high. A handful of U.S.-listed firms have already announced their exposures to Sam Bankman-Fried's short-lived crypto empire, namely Coinbase (COIN) and Silvergate Capital (SI). In November, SEC Chairman Gary Gensler also confirmed that crypto investors "need better protection in this space." (2 comments)

Meet C919

After 14 years of development, the Commercial Aircraft Corporation of China, better known as COMAC, delivered its first domestically-developed passenger jet to launch customer China Eastern Airlines (NYSE:CEA). The C919, similar to the Airbus (OTCPK:EADSY) A320 and Boeing (NYSE:BA) 737 narrow-body jet families, brings China a step closer toward its ambitious goal of becoming a global civil aerospace player. The plane is expected to make its maiden commercial flight in the spring, with a trip between Shanghai and the capital Beijing, as well as hopes to quickly expand routes to other cities.

Industry response: "Congratulations to COMAC for delivering the first C919, bringing a new model to the global civil aviation market," Boeing China wrote on its WeChat account. "We look forward to working with COMAC and other industry peers to continue working on the long-term sustainable development of the aviation industry," Airbus added in a statement.

China's first national passenger jet contains 164 seats, with a maximum range of 3,450 miles. The C919's price tag also comes in at $99M, compared with costs of around $111M and $122M for similar-sized Airbus A320neos and the Boeing 737 Max family. In terms of backlog, COMAC has already booked 1,115 orders (mostly from Chinese lessors) versus the 6,200 and 3,590 order backlog for the A320neo and 737.

Outlook: Despite the emerging C919, it will take many years before COMAC becomes a serious threat to the Western aerospace duopoly. Besides finding new customers outside of China, the program is expected to produce only 25 C919s per year by 2030, which is way lower than the monthly narrow-body production rates at its rivals. The C919 also relies heavily on Western components, including engines, flight systems and other critical parts that are manufactured by companies like GE (NYSE:GE), Honeywell (NASDAQ:HON) and Safran (OTCPK:SAFRY). (15 comments)

Rare miss

Costco (COST) uncharacteristically missed earnings estimates after the bell on Thursday. Investors were eager to hear the results given the headwinds facing the economy, as well as whether spending is being diverted from discretionary items to the necessities.

Snapshot: The retailer reported $3.07 in earnings per share on $53.44B in revenue, compared to analyst expectations of $3.12 and $54.68B, respectively. The miss wasn't seen as major, with the stock hardly moving in response, but it did suggest that many shoppers are paring back on bigger ticket items. Comparable sales from stores open at least a year also rose 7.1% during the period, marking the first time the figure has fallen below 9% over the past two years.

Other retailers have flagged weaker sales trends this past quarter, including Target (TGT) and Walmart (WMT). Costco may look to make up some of the lost profits with a membership fee hike, and CFO Richard Galanti said it wasn't a question of if, but when. "We feel that we're in a very strong competitive position right now and if we have to wait a few months or several months, that's fine."

From the SA comments section: "I see it as more about the overall change in the economy than Costco, but it's been richly valued and vulnerable to a downturn," wrote user zingerizer. "I am a big believer in COST despite the miss," countered DividendLand. "On the surface one might think missing estimates is a serious problem. I think one has to dig deeper. Lack of inventory is a problem, and might be an explanation." (28 comments)

Today's Markets

In Asia, Japan +1.2%. Hong Kong +2.3%. China +0.3%. India -0.6%. In Europe, at midday, London -0.1%. Paris +0.1%. Frankfurt +0.4%. Futures at 6:30, Dow +0.2%. S&P +0.3%. Nasdaq +0.4%. Crude +0.7% to $71.98. Gold +0.6% to $1812.40. Bitcoin +2.3% to $17,242. Ten-year Treasury Yield unchanged at 3.49%

Today's Economic Calendar

8:30 Producer Price Index 10:00 Consumer Sentiment 10:00 Wholesale Inventories (Preliminary) 1:00 PM Baker-Hughes Rig Count

Companies reporting earnings today »

What else is happening...

Lululemon (LULU) holiday quarter guidance misses high expectations.

Broadcom (AVGO) to face European probe into VMware (VMW) deal.

Updated COVID boosters cleared for children as young as six months.

Lithium execs say mega-rally in prices could have more room to run.

Keystone pipeline (TRP) shut after 14,000-barrel oil spill in Kansas.

United Airlines (UAL) poised for major order of Boeing (BA) Dreamliners.

Meta Platforms (META) set to face antitrust trial on virtual reality tie-up.


Chain Joes is a mobile isometric action shooter that contains adversaries that use Web3

Chain Joes is a mobile isometric action shooter that contains adversaries that use Web3. Everyone is aware of them, dislikes them, and wishes they'd get kicked! We want every player to show their indignation toward malicious hackers, impolite spammers, and heartless criminals. Players have the option to engage in combat in the event that these goons are insufficient. Or human? Which? Dog or ape? Only Chain Joes will respond to your inquisitive questions. When the situation becomes too exciting, we bring out our most powerful tools (literally and figuratively). This gaming masterpiece makes use of WEB3 opponents, established game principles, and a ground-breaking new paradigm called Play-And-Earn, which is less expensive and more straightforward than the Play-To-Earn model. Making money in the game has evolved into a benefit of playing it. The management and ownership of in-game assets will be accomplished through the usage of Chain Joes ($CJ) and non-fungible tokens (NFTs). Enhance the gameplay to achieve the greatest possible immersion in the metaverse. All of the Chain Joes are knights.

#CHAINJOES #ICO #CRYPTO #BITCOIN


Why The Halving Event Will Push Bitcoin Price To Reach $100,000 In 2024

https://bitcoinist.com/bitcoin-to-reach-100k-in-2024/