Welcome to the Bitcoin Lighthouse newsletter.
📈 Bitcoin Price
🌡️ 21Towers Temperature
The 21Towers Bitcoin Temperature is the same at 2.05, near the Extreme Fear zone. We continue to be Greedy when the market is in Fear. To see how we calculate this, click here.
- 🥳 Huge accounting changes for bitcoin
- 🇸🇻 El Salvador launches Bitcoin education program in schools
- 💸 Eric Balchunas, Bloomberg analyst predicts $150 billion inflow on spot Bitcoin ETF approval
🥳 Huge accounting changes for bitcoin
The Financial Accounting Standards Board on Wednesday said companies should use fair-value accounting for measuring bitcoin and other crypto assets, moving a step closer to a standard that could clear up uncertainty over reporting how much such holdings are worth.
The old accounting rules for Bitcoin were terrible and made it look bad. Here's why:
- Bitcoin was accounted for as an "intangible asset".
- If Bitcoin's price went down, companies had to record a loss even if they didn't sell.
- If Bitcoin's price went up, companies couldn't record gains unless they sold.
The new rules are much better:
- Companies will now record unrealized gains/losses each quarter.
- If Bitcoin's price goes up, gains can be recorded without selling.
This is a massive breakthrough! Companies can now report digital assets at current value instead of cost.
Why This Matters
- Makes Bitcoin more attractive for major companies to invest in.
- Old rules significantly impacted reported finances.
- MicroStrategy example:
- Q1 2022 - $131M net loss despite strong business.
- $170M Bitcoin impairment loss.
- Would have had $39M profit excluding Bitcoin loss.
- New rules allow gains to be realized as prices fluctuate.
- Better reflects Bitcoin's true value on financial statements.
The ability to now account for crypto at fair market value is great news. This added transparency and accuracy is a step towards further adoption!
🇸🇻 El Salvador launches Bitcoin education program in schools
- El Salvador has launched an ambitious program to teach Bitcoin in every public school by 2024.
- The education ministry aims to incorporate Bitcoin into the national curriculum.
- This is part of El Salvador's broader adoption of Bitcoin as legal tender.
- The program is called "Mi Primer Bitcoin" (My First Bitcoin).
💸 Eric Balchunas, Bloomberg analyst predicts $150 billion inflow on spot Bitcoin ETF approval
- Eric Balchunas, a respected Bloomberg analyst, sees a 75% chance of SEC approving BlackRock's bitcoin spot ETF application by mid-October.
- He predicts $150 billion could flow into a bitcoin spot ETF in the first 12 months if approved.
- This is 0.5% of the $30 trillion held by financial institutions.
- However, only $47.5 billion of bitcoin is liquid across exchanges today.
- The predicted inflows are 3 times the liquid bitcoin available, which could drive prices sharply higher.
- An approved bitcoin ETF would allow mainstream investors easy exposure to bitcoin for the first time.
- Balchunas is a widely followed ETF expert, so his predictions carry significant weight.
- Overall, he expects massive early demand that could exceed available bitcoin liquidity if a spot ETF is approved.
This is the last week to sign up for the next cohort of our online Bitcoin workshop starting in mid-September. It’s free, by application only.
👨🏫 Learn Bitcoin
Watch the below video by Anil SaidSo on why money converges to one.
In the digital age there will not be 100’s or 1000’s of different forms of money. There will only be ONE.
This is critical to understand, because saving in an inferior money means destroying your purchasing power over time. Right now, all logic points towards bitcoin becoming the singular global digital money.
✒️ Famous Quotes
“Bitcoin was created to serve a highly political intent, a free and uncensored network where all can participate with equal access.”
– Amir Taaki