Why Coins Keep Rising
The president of the Crypto Club.
Joo Do-kyung had been on fire lately.
"Everyone, coins go up. Do you believe?"
"We believe!"
"Coins are destined to moon. Do you believe?"
"We believe!"
Club membership was slowly recovering.
Crypto's value was finally getting broad recognition.
And now there was another reason.
A student walking past muttered something under his breath.
"Bunch of idiots who'd believe a Ponzi scheme…"
"What?"
"How dare you blaspheme the sacred Coin God!"
"Haha, settle down, my faithful. That friend simply doesn't understand the holiness of coins."
Ordinarily, it would have bothered him.
Wicked heretics, defiling the doctrine of crypto.
Foolish. Hopelessly foolish.
But things were different now.
Coins were receiving massive recognition.
And it went far beyond mere price appreciation.
"Do not waver."
"Amen."
"Coins will lead you to eternal life. Together with the Stable Goddess!"
"Wooo!!"
Real value had arrived.
Another coin had appeared that underwrote Bitcoin's worth.
Truly a goddess!
Coins were gods.
And stablecoins were goddesses.
Think of them as the ones who cleared the path for the god to walk.
"Uh, Director?"
"Cult Leader."
"You're supposed to call me Cult Leader!"
"Haha, any title is fine. What is it?"
"What even is a stablecoin, and how does it raise Bitcoin's value?"
The truth had not yet spread across the world.
Why crypto's value had no choice but to climb infinitely.
Stablecoins are pegged one-to-one with the dollar.
You could treat them as equivalent to dollars.
And the foundation holding them kept buying Bitcoin without stop.
"They, too, are devout believers of the Coin Faith."
"Ohh!"
"Stablecoins are issued every month, and every last one of them is spent buying Bitcoin. Therefore, coins have no choice but to keep rising!"
"Woooaaah~!!"
A structure that issued coins to buy coins.
That was why Bitcoin's price had nowhere to go but up.
With stablecoins, no less.
They held the same value as the dollar.
A coin with that kind of creditworthiness was underwriting Bitcoin.
"Then how does a stablecoin keep its value? Who keeps buying it at one dollar?"
"Heh heh. Excellent question."
A believer of shallow faith, just moments ago.
Still carrying doubts about crypto, it seemed.
That was fine.
That was what the goddess was for.
The foremost worshipper propping up Bitcoin.
How do banks guarantee their own credit? Because they hold a lot of cash.
Stablecoins worked the same way.
They held large quantities of cash—or bonds that could be converted to cash instantly.
"You could call them the banks of the crypto world. And the Bitcoin they hold keeps rising in price, doesn't it?"
"What happens when it rises?"
"They gain more credit. Which means they can buy even more Bitcoin, everyone!"
"Woooaaah~~!!"
"?"
That was what guaranteed a stablecoin's value.
The Bitcoin they had already purchased rose day by day.
On the back of that growing credit, they bought still more Bitcoin.
Bitcoin's price rose again, and so did their credit.
An infinite virtuous cycle. This is the future of cryptocurrency. Mmm!
Joo Do-kyung was thoroughly pleased with his own explanation.
The fervent reaction of the faithful proved it.
"There will be even more stablecoins going forward."
"Woooaaah~~!!"
"There's even a Korean coin—Luna Coin!"
"Woooaaaah~~~!!!"
"Hell yeah, hostess!"
"National pride!"
"National BS?"
Cryptocurrency was about to get even more enormous.
God and goddess.
Bitcoin and stablecoins would lead the way.
What the actual fuck is this nonsense?
Day three of getting into crypto.
Sewoo's mind went blank.
Common sense said there was no way any of this could be true.
Club activities.
Not everyone enjoyed them.
"There's no way… there's just no way…"
The friend in the next seat seemed to be struggling.
He muttered to himself for a while, then fled as if escaping.
"Looks like he couldn't adapt to the club."
"There are always friends like that. If only he'd devote himself purely—tsk tsk."
What was he thinking?
I was in no position not to know.
I had been fairly active in this Crypto Club myself.
I had even gotten pretty close with the club president.
Partly to share information as a crypto investor.
In the land of the blind, the one-eyed man gets beaten up.
He made a perfect human benchmark.
He was sharp enough that I could read the psychology of recent crypto investors at a glance.
"As long as this stablecoin exists, coins will draw an infinite upward curve. Everyone, do you believe?"
"We believe!"
Stablecoins.
Virtual currencies pegged one-to-one with the dollar.
The theory was that they underwrote Bitcoin's value.
No way in hell.
Obviously pure bullshit.
The world didn't run that easily or that cozily, did it?
But it was also a phenomenon that was genuinely happening.
On the stock market, they put it this way.
The birth of a new logic.
"You're incredible."
"Not at all. It's all thanks to the faithful who always believe and follow."
"If stablecoins buy Bitcoin without limit, then Bitcoin would have infinite—no, even greater—value, right?"
"Exactly! As expected of Believer Chan-wook. Bitcoin's supply is capped, after all. Heh heh."
There was something called the Hyman Minsky model.
The most famous and universal theory explaining how bubbles form.
When a market rises too far.
Economic theory said it naturally had to come down.
Rational investors dumping their assets, and so on.
In reality, it didn't work that way.
A new logic.
A principle that the asset would rise even further got manufactured (?).
"Everyone, coins go up. Do you believe?"
"We believe!"
"Coins are destined to moon. Do you believe?"
"We believe!"
At least it was useful to me.
The more people believed, the more froth piled onto crypto.
And they would go on to recruit new investors.
Even for someone running a Ponzi scheme, it wasn't easy.
One wrong move and you'd be stuck holding the inventory yourself.
Value unchanged, only the price rising?
Other Illicit Stock Manipulators might catch on and start shorting.
Stablecoins.
And futures listings.
Those two provided liquidity to the market.
Illicit Stock Manipulators could raise prices with peace of mind.
Retail investors who saw the climb swarmed in like flies.
Tap. Tick!
It made no sense by any common measure.
If you could raise any asset's value without limit, every dog, cow, and the family puppy would all get rich.
Which meant there was a hole somewhere.
It would blow up in the stablecoins.
Triggered by a single incident.
As expected—it hasn't blown up into a scandal yet.
The biggest reason stablecoins could hold trust was bonds.
In other words, trust was proportional to bond holdings.
Bonds were expensive.
So they faked their bond holdings.
Crypto's loose legal regulations made it possible.
A house of cards that would collapse the moment it was exposed.
I just had to keep that in mind while trading crypto.
Grand Capital.
One of the world's largest investment banks.
"These are the documents I sent by email. If you've reviewed the above contents, please sign."
Its influence in finance needed no explanation.
Being treated like royalty on every business trip had become routine.
This place is a little different, though.
Hamilton, an IB banker, could feel the undercurrent.
Unlike private banking, he advised corporations rather than individuals.
This was one of their subsidiaries.
By company size and by position, they should have been the ones holding the upper hand—
"Any changes to the terms?"
"Nothing in particular. No—nothing!"
"Then there's no need to reconfirm. Signature complete."
Host and guest had switched places.
The woman across from him carried herself with the clear awareness that she was the one on top.
Doesn't seem like she's just full of herself because she's pretty.
At first he had been flustered.
You're our subsidiary, aren't you?
You're borrowing our bank's money, aren't you?
But the world wasn't that simple.
The contract terms were incomparably more aggressive than any other client deal.
Gulp.
He had at least that much sense.
Hamilton hadn't spent just a day or two in corporate life.
To run IB, you had to be something of an elite.
In the fly-or-die world of Wall Street, no less.
Information that never reaches—and doesn't need to reach—an ordinary employee like me…
At the end of the day, he was just a regular staffer.
He instinctively knew he shouldn't try to find out.
After confirming the signature, Hamilton fled the client meeting as if escaping.
This will let us build a smoother cash flow.
Rachel Bigger.
She held a director's seat at the family office.
A private fund that wealthy families established for asset management.
There were several others besides this one.
Family heirs operated them directly or indirectly, and fund performance shaped the heirs' reputations.
Click.
Rachel was still young.
She hadn't even made the formal list of successors.
She was carrying out a special assignment to earn recognition.
"Director!"
"Is the buying proceeding well?"
"So well I'm already looking forward to incentive day. Haha!"
She returned to the office.
Fabian, team lead of the unit under her command, bustled over with a report.
Of course it should be going well.
It couldn't help but go well.
The family's power.
Every scrap of information in the world arrived fast and accurate.
And in finance, information was money.
Converting it was the core of the job.
"The pace of bond purchases by stablecoins and mining operators is accelerating. Therefore, we will place an even stronger bet on Bitcoin's rise."
"Even stronger than now?"
"If you have objections, speak up anytime. With sound reasoning."
"Ah—no… I completely agree with the Director's assessment!"
The point was how much better they could execute.
Rachel had absolute confidence in her own ability.
What a boring man. He follows orders well enough, so it doesn't matter.
She had bet a massive sum on Bitcoin's rise.
A direct challenge to the industry's skeptical view of crypto.
Because she had seen the structure.
On the back of that performance, she succeeded in securing even larger capital flows.
"Trading volume has been surging lately. Clearly the short-term uptrend won't break."
"And the report?"
"Yes! Recent trading data. No anomalies detected."
Of course, a big bet carried big risk.
But with the family's power and information network, even that could be hedged—
Hm?
The Bitcoin trading data her subordinate had compiled.
A faint trace of something that bothered her lingered in it.