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The Fed blinks

Coinbits's Photo
by Coinbits
Friday, Dec 12, 2025 - 20:58

In 2008, Ben Bernanke promised quantitative easing was temporary and that the Federal Reserve's balance sheet would soon shrink back to normal. Seventeen years later, Jerome Powell just announced $40 billion in monthly Treasury purchases starting Friday.

The rate cut was expected. The return of QE was not (at least not this early).

Creative Planning's Charlie Bilello captures the absurdity perfectly. Stocks are at all-time highs, home prices are at all-time highs, gold is at an all-time high, the money supply is at all-time highs, national debt is at all-time highs, and the inflation rate is double the Fed's target – and the Fed is easing anyway.

Three FOMC members dissented from yesterday's decision, which is the first time that has happened in six years. The central bank seems to be cracking under the weight of its own contradictions.

When the Fed buys bonds, it pushes investors into riskier assets searching for yield. This "liquidity wave" has historically inflated stocks, real estate, and bitcoin. The biggest loser? The U.S. dollar.

The Fed cannot stop printing. It never could. Bitcoin exists because of and precisely for moments like this.

Satoshi Nakamoto statue installed at the New York Stock Exchange

The New York Stock Exchange now hosts the sixth of artist Valentina Picozzi's "disappearing" Satoshi Nakamoto statues, installed by bitcoin firm Twenty One Capital to coincide with the anniversary of Nakamoto's bitcoin mailing list launch on December 10, 2008. The NYSE called the installation "shared ground between emerging systems and established institutions," a contrast with just years ago when bitcoin was taboo on Wall Street. Public companies, private companies, sovereign treasuries, and funds now collectively hold more than 3.7 million bitcoin worth over $336 billion. Wall Street is no longer fighting the inevitable.

SpaceX's $300 million bitcoin stack set to enter world's largest IPO

SpaceX is preparing a public offering that could value the company at $1.5 trillion, making it the largest IPO in history. Analytics firm Arkham Intelligence shows SpaceX holding approximately 3,991 bitcoins worth roughly $369 million.

When SpaceX goes public, shareholders will gain exposure to one of the earliest institutional bitcoin holders. Combined with Tesla's 11,000 bitcoins it holds in its treasury, Musk's corporate empire demonstrates that bitcoin on the balance sheet is becoming standard practice for forward-thinking companies.

Treasury Secretary Bessent removes bitcoin and digital assets from financial risk watchlist

The Financial Stability Oversight Council's 2025 annual report, released Thursday, entirely erased bitcoin and digital assets as a "vulnerability" to the U.S. financial system, removing even the word "vulnerabilities" from the table of contents. Treasury Secretary Scott Bessent argued that "financial stability also requires and is interdependent with sustainable long-term economic growth." This is yet more concrete change to the Biden-era hostile stance toward bitcoin that portends well for the long-term viability of the American economy.

From threat to asset

For years, FSOC's annual reports treated bitcoin as a ticking time bomb. Now, with the word "vulnerabilities" scrubbed from the table of contents, messaging out of Washington about bitcoin is better aligned with reality. Bitcoin is now recognized as a component of grand strategy. As the U.S. is coming around to this reality, so are many other nations.

Affordability crisis deepens as 40% of high earners live paycheck to paycheck

A new Goldman Sachs study reveals that 40% of workers earning over $300,000 annually are living paycheck to paycheck, while economist Peter C. Earle notes that cumulative price increases since 2021 continue to outpace wage growth across nearly every category. Despite administration claims that "costs are way down across the board," food prices have risen over 23%, energy over 30%, and electricity costs have climbed relentlessly since early 2021.

When a $300,000 income is not enough, the money is broken

The data exposes a brutal truth: no income level is safe from currency debasement. Bitcoin offers a lifeboat from this slow-motion wealth destruction, providing a savings technology that cannot be inflated away by monetary excess or political denial.

BITCOIN ADOPTION CONTINUES

Roxom launched the first global stock exchange denominated and settled entirely in bitcoin, allowing direct bitcoin trading of shares of companies that hold bitcoin in their treasuries.

Fidelity CEO Abigail Johnson, head of the largest 401(k) provider in the U.S., declared, "I like bitcoin. I own bitcoin. It will play a role in the savings hierarchy."

Pakistan announced plans to make bitcoin the foundation of "a new financial rail" for its 240 million citizens, with officials citing El Salvador's success despite it has only 1/40th of Pakistan’s population.

Save the Children launched a Bitcoin Fund to hold bitcoin donations for up to four years, enabling faster crisis response.

BBC profiled Lugano, Switzerland as a "bitcoin city" where 350 shops, restaurants, and municipal services accept bitcoin payments.

The Office of the Comptroller of the Currency authorized U.S. banks to buy and sell bitcoin on behalf of customers, acting as brokers in the same way they handle securities.

HOW BITCOIN WORKS

Learn one key idea about bitcoin each week. This week:

Will money become irrelevant?

At the U.S.-Saudi Investment Forum last month, Elon Musk predicted that advances in AI and robotics will eventually make money "stop being relevant." It is a bold claim from a bold thinker. It is also wrong.

Money exists because the future is uncertain. If humans could perfectly predict their needs, resources, and circumstances, they would have no reason to hold a universally exchangeable asset. But uncertainty is not a bug in the human condition. It is a feature. As economist Ludwig von Mises observed, "Only because there is change, and because the nature and extent of change are uncertain, must the individual hold cash."

No amount of technological progress can eliminate uncertainty. Nature remains unpredictable. More importantly, human action itself cannot be forecast with scientific precision. People learn, adapt, and change their minds. Any being capable of learning cannot know today what it will know tomorrow. This means future decisions remain fundamentally unknowable, and money remains fundamentally necessary.

What technology can do is make money better. Rather than rendering money obsolete, bitcoin perfects it. Its fixed supply removes the political manipulation that plagues fiat currencies. Its distributed ledger creates an immutable record of ownership that can persist for centuries. And its time-locked contracts even enable financial commitments that span generations.

Bitcoin does not eliminate the need for money. It fulfills money's highest potential: a tool for coordinating human action across time and space without relying on corruptible institutions.

Money will not become irrelevant. It will become bitcoin.

COIN CHECK

In this article’s comparison of the bitcoin blockchain to stone, about how many times stronger (in energy required to rewrite history) are six bitcoin blocks than the ancient marble slab Lapis Primus?

A) ~77× — roughly the difference between hand tools and early industrial machinery
B) ~770× — comparable to scaling from a household task to a small factory
C) ~7,700× — on par with the jump from a factory to a regional power plant
D) ~77,000× — similar to the gap between local and national infrastructure
E) ~770,000× — approaching the energy footprint of a mid-sized city for a day

Check your answer at the end of the page.

FROM THE MEME POOL

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ANSWER

Answer: E. ~770,000×

The article estimates about 14.3 kWh to alter the marble slab, versus roughly 11,000,000 kWh to outpace the network and rewrite six recent blocks. That ratio lands near 770,000, illustrating the idea that bitcoin’s history is not just hard to change, but orders of magnitude more resistant than even humanity’s most durable physical records.

Contributor posts published on Zero Hedge do not necessarily represent the views and opinions of Zero Hedge, and are not selected, edited or screened by Zero Hedge editors.
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