Heidegger and Bart Simpson do crypto
Truth is often stranger than fiction but nowhere more so than in the world of cryptocurrencies, where the lines between the two are blurring at an alarming rate.
This week has seen the publication of (at least) two potentially seminal works on digital assets. One was intended as a serious piece of research distributed to journalists; the other, a broad parody. Readers are invited to guess which is which. Correct answers will win a sticker depicting a vomiting camel formation.
Sam Kopelman, UK manager of crypto broker Luno, rushed to provide expert commentary to clients about the new declines notched up by bitcoin on Wednesday. While the value of the most prominent digital coin plunged to below $30,000, Kopelman was quick to reassure retail punters that bitcoin would soon be trading at $34,500 because of the re-emergence of the Bart Formulation (sic).
“[The decline in the price] marks a re-appearance of the previous bear market in what crypto experts call a Bart Formulation. The Bart is a chart pattern in which the crypto market rallies sharply before experiencing a short period of sideways movement until it suddenly retraces all of its previous gains,” was Kopelman’s imparted wisdom.
Take a moment to consider that Luno says it has more than 10mn customers across 40 countries. This is supposedly one of the more trustworthy, regulated and credible companies that retail investors can turn to when dabbling in crypto. And here is one of its key people basing investment advice MARKET COMMENTARY* on Bart Simpson’s haircut.
The infamous Bart pattern — coined through a humorous reference to the shape of Bart Simpson’s head — suggests that the dip will be followed by another spike. As the market attempts to claw back its losses in May, we may see this pattern continue as investors reclaim lost confidence and test the next resistance of $34,500 once again.
To be fair, there is no reason why Bart’s name and image can’t be appropriated for technical analysis. There is precedence: the Marubozu candle formation, for one. According to those who make predictions about future price movements based on the patterns of the past, the Marabozu candle is considered a sign that prices will rise. It is also a Japanese word that means bald or shaved head.
But none of this explains why bitcoin’s price is set to rebound. If we accept that the “sideways movement” in bitcoin’s price represents Bart’s hair, the next leg surely must be lower, ie the outline of the side of Bart’s head. Kopelman appears to be forecasting an inverse Bart because, as far as we are able to tell, there is no uptick anywhere here:
The other significant contribution to cryptocurrency literature this week came in the form of a white paper describing the qualities of a new stablecoin. This is very timely, coming just weeks after the spectacular collapse of algorithmic stablecoin Terra, which wiped out some $60bn worth of assets in one dramatic trading session. Terra’s failure has intensified the regulatory spotlight on stablecoins, which link fiat and crypto assets.
The authors of the white paper for ZeroStablecoin, or ZERC, have a proposal to create a stablecoin that 1) is not unstable 2) is immune to scammers and governance glitches and 3) is compliant with regulatory requirements all over the world.
The proposal is to peg the coin to zero.
“Naive readers might be tempted to think that ZeroStableCoin is valueless, as zero is commonly associated with absence of value. However, the value of zero is nonnull, though uncountable, as wiser souls than us demonstrated,” the paper says, before citing the Dalai Lama.
That’s right, it’s a zen stablecoin worth zero but also not zero.
The starting point of their work cites I Want It That Way by Backstreet Boys as describing a common condition: “In human endeavour and in particular in the fields of romance and finance, users often ask rhetorical questions of the universe, such as ‘tell me why?’” they write.
Perhaps sensing their audience was ready for more highbrow references, the authors progress to complex mathematical equations.
And to prove the mathematical mettle behind ZeroStablecoin, the authors add this helpful chart for the back of the class:
“ZeroStableCoin’s emptiness of things is therefore its unparalleled power compared to other stablecoins. A power already discovered by philosophers specialized in the field,” the paper continues, before quoting Martin Heidegger’s rhetorical dictum “das nichts nichtet”.
The nothing noths is, it suggests, an alternative way of saying 1 ZERC = 1$ = 1£ = 1€ = 1 BTC. Those values remain true even under “various hostile market regime assumptions, and against different adversarial models: rational, irrational, malicious, honestbutcurious, honestbutmalicious, active, passive, proactive, probiotic, hermetic, and prophylactic.”
In what we call the Dark Ages of Stablecoins, many “stablecoins” were created, but now have a value of zero or almost zero, or are widely believed to “go back to nothing”, owing to their poor design or questionable governance model. The Enlightenment of stablecoins has a name: ZeroStableCoin. the first coin that is by design pegged to zero, and is provably stable.
As is obligatory, ZeroStableCoin talks of a “vibrant community of developers, economists, and artists” that will lever its guarantee of zero value into areas including NFTs, token swaps and derivatives. It’s only by the reference page — which includes the recent redraft of the UK Ministerial Code and an anthemic crypto-widow TikTok — that the reader’s credulity is stretched more than by the average crypto white paper.
Nevertheless, perhaps the zen stablecoin is no more or less useful most crypto analysis. After all, the Simpsons’ own white paper of sorts shows a variation of the Bart formation that is much less dynamic:
*The company would like to stress that this is definitely not investment advice, merely “market commentary”.
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