The Great Debasement Update: Why the Current Crash Is Just Noise in a Century-Long Symphony
Bitcoin is Still Working as Intended
Everything you are watching right now — Bitcoin down 33 % from its all-time high, miners down 60-70 %, MicroStrategy bleeding, Nasdaq in the red, gold softer — feels like pain.
But zoom out far enough and you’ll see this is not a refutation of the Bitcoin thesis.
It is the single clearest, real-time confirmation we have ever had.
Act I – The Theory (the conversation we started with)
When the unit of account itself is melting (the U.S. dollar losing purchasing power at 3-8 % a year officially, and far more if you live in the real world), every quality asset appears to go “up forever” in nominal price. Stocks, real estate, gold, Bitcoin — they all ride the same tide.
The danger is denominator blindness: we mistake the rising number for rising value, when in reality the ruler is just shrinking.
At the extreme, the dollar price of everything becomes absurd ($1 trillion per Bitcoin, $1 trillion per Berkshire share) and the quote stops carrying information. Value rediscovery begins against things that cannot be printed: gold historically, Bitcoin digitally.
Two clean endgames were always on the table:
Bitcoin becomes the silent reserve gauge behind a limping fiat (most likely).
Bitcoin becomes the currency itself after total fiat collapse (less likely, more chaotic).
Either way, fiat gets demoted from “store of truth” to “convenience layer,” and a fixed-supply asset becomes the final denominator.
That was the theory.
Act II – The Policy (March–November 2025)
Reality moved faster than any of us imagined.
March 6, 2025: President Trump signs the executive order creating the Strategic Bitcoin Reserve, seeded with ~210,000 seized BTC and stamped “never sell.” Overnight, the United States — issuer of the world’s reserve currency — declares Bitcoin is digital gold and places it permanently on the national balance sheet at market value.
Nations, states (Texas, Pennsylvania, New Hampshire), pension funds, and corporations began stacking in earnest. The post-election narrative was simple: Trump will spend big, cut rates, ignite inflation → dollar melts → Bitcoin to $200k–$300k easy.
The entire 2025 rally from ~$40k → $126k in October was nothing more than the market pricing in accelerated dollar debasement.
Act III – The Backlash (November 2025)
Then the old guard fought back.
Jamie Dimon, high priest of the fiat empire, went on television and said America should stockpile bullets, not Bitcoin. The Fed pushed back hard on rate-cut expectations. Bond yields ripped higher. The dollar index surged 5 % in weeks.
Suddenly the ruler stopped shrinking.
When the denominator stops melting (or even lengthens a little), every asset priced in that denominator must fall in nominal terms — even if its fundamental scarcity or utility is unchanged or improving.
Bitcoin’s 33 % drawdown is not Bitcoin failing.
It is Bitcoin doing its job perfectly: exposing, in real time, that the expected debasement slowed down.
The same force crushed miners, MicroStrategy, AI stocks, and anything levered to cheap money. It was the entire “reflation trade” unwinding at once.
Act IV – Why This Is Transitory Noise
The structural drivers have not changed even slightly:
U.S. debt is $37 trillion and climbing $2 trillion+ every year.
Annual deficits are still 7–8 % of GDP with no political will to cut.
Interest expense on the debt is already the fastest-growing budget line and will soon eclipse defense spending.
The Strategic Bitcoin Reserve still exists and is explicitly “never sell.”
Nations are still accumulating (Bhutan, El Salvador, Germany selling its gold mistake and quietly buying BTC, etc.).
BlackRock, Fidelity, and sovereign wealth funds are still buying every dip.
The current crash is nothing more than the market discovering that the path from fiat to Bitcoin standard will not be a straight line. There is political friction. The printer does not surrender quietly.
But friction is not reversal.
Where We Actually Are
We are in the messy middle of the gauge phase, watching it play out live and in reverse:
When dollar debasement accelerates
→ Bitcoin nominal price moons (real value stable/rising)
When dollar debasement pauses
→ Bitcoin nominal price crashes (real value still stable/rising)
This week’s red candles are Bitcoin screaming: “The ruler just got a little longer again… for now.”
That “for now” is the entire ballgame.
History shows no fiat currency has ever voluntarily restrained itself once the debt spiral is this advanced. The U.S. will either:
resume printing (most likely), or
trigger a sovereign debt crisis (less likely, but even more bullish for Bitcoin).
Either path leads to the same destination: more debasement, more Bitcoin accumulation by nations, and an eventual world in which everyday prices are still quoted in “dollars” for comfort — but those dollars are synthetic units floating on top of a Bitcoin gauge that cannot be diluted.
The Bottom Line: Bitcoin Is Not Just Fine, It Has Already Won
The current drawdown is painful, but it is healthy. It is washing out the 2024–2025 leverage, the tourists, the miners who over-expanded, the MicroStrategy margin loans.
When the next leg of debasement resumes — and it will, because math is undefeated — the move higher will be on a far cleaner base.
We do not need to guess whether Bitcoin becomes the new denominator.
The United States government already put it on the balance sheet and declared it unsellable.
Everything happening right now is just the price we pay for watching the greatest monetary regime change in a century unfold in real time.
Hold through the noise.
The ruler always resumes shrinking.
And when it does, one Bitcoin will still be one Bitcoin — twenty-one million minus the ones nation-states refuse to ever let go.
The symphony is not over.
We’re just between movements.