TLC: THE LONG CON:
The markets are frothing with liquidity.
How Wall St. conquered the wild west of crypto by laundering funds obtained from illegal naked short selling practices through stock market exchanges worldwide.
Mobile Edition & full PDF: https://docs.google.com/document/d/1fdZV5B6RtyVurxcVsXAOtWNn5NE8BZS1TPu24ZAzLkI/edit?usp=sharing
Contributors: (sources, written input, quantitative analytics, general research)
Proof read by:
Let me first state that I am an advocate of crypto currency. I believe that Decentralized Finance and blockchain are a disruptive and innovative technology that will usher in a new online ‘industrial revolution’. That being said; it is my belief that members from shadow banking institutions and the Wall St. elite have sought to enforce a dominating presence across the entire sector. In doing so, prohibiting crypto currency from truly being a free and decentralized platform for the masses, they have used its democratic potential to launder trillions of dollars from the proceeds of illegal activities including naked short sales not just in the United States of America but worldwide.
Chapter 1: An apes introduction into crypto
Chapter 2: So you’re wondering right now why crypto?
Chapter 3: Leverage In Crypto: THE LONG CON BEGINS
Chapter 4: The Crypto Cartel
Chapter 5: The connection between RRRPs, crypto and the NSCC 802 legislation
Chapter 6: The repercussions of NSCC 802 (May the fourth be with you until present)
Chapter 7: Fighting fire with fire: A Gamestop NFT
I am only but a humble ape.
I am not a financial adviser. I do not provide any financial advice below.
Many thoughts here are my opinion, and others can be speculative.
I worked in private banking and savings & investments for a big bank in the UK before moving to a competitor in which I worked in ISA investments for some time.
I have always been entrepreneurial and have for some time now been GPU mining and running passive incomes through PoW mining and then evolved to using LP token creation and DeFi (Decentralized Finance) usage to further my portfolio progress.
I run both a crypto portfolio and a stocks and shares portfolio. At this moment in time however I only hodl one position and that is GME.
I decided to question why this is the only position I chose to hodl when it came to my portfolio overall;
AN APES INTRODUCTION TO CRYPTO:
In crypto you have multiple ways to create it.
PoW – Proof of work mining. (Mining)
It is the use of GPU graphics cards or ASICs to solve algebra / algorithmic equations to continue the blockchain often done in pools of combined resources from many miners.
It is needed to make the online currency work without a company or government running the show. It is a necessary part of adding new blocks to the blockchain
PoS – Proof of stake (Staking)
The main idea is that participants can lock coins (their “stake”), and at particular intervals, the protocol randomly assigns the right to one of them to validate the next block. Typically, the probability of being chosen is proportional to the amount of coins – the more coins locked up, the higher the chances.
DeFi (Decentralized Finance) & the use of LPs (Liquidity Provider tokens)
DeFi platforms allow people to lend or borrow funds from others, speculate on price movements on a range of assets using derivatives, trade crypto, insure against risks, and earn interest in savings-like accounts.
DeFi uses a layered architecture and highly composable building blocks. Some DeFi applications promote high interest rates but are subject to high risk
The majority of which are built on the ERC20 network however alternative networks are available for the same practices.
The E network is prevalent due to the ability to create smart contracts
A smart contract is a self-executing contract with the terms of the agreement between a buyer and a seller being directly written into lines of code. The code and the agreements contained therein exist across a distributed, decentralized blockchain network. The code controls the execution, and transactions are trackable and irreversible.
Smart contracts permit trusted transactions and agreements to be carried out among disparate, anonymous parties without the need for a central authority, legal system, or external enforcement mechanism.
While blockchain technology has come to be thought of primarily as the foundation for bitcoin, it has evolved far beyond underpinning BTC itself.
Smart contracts render transactions traceable, transparent, and irreversible.
ELIA: I make a spreadsheet, add a column that the person who I send it to can insert their username, they then send the spreadsheet to the next user and so on. The information submitted by the previous member isn’t erasable, once that information is submitted onto the spreadsheet it will always remain, the only thing you can do is to add a new entry and pass it along.
How Smart Contracts Work: (A brief history)
Smart contracts were first proposed in 1994 by Nick Szabo, an American computer scientist who invented a virtual currency called “Bit Gold” in 1998, fully 10 years before the invention of bitcoin. In fact, Szabo is often rumored to be the real Satoshi Nakamoto, the anonymous inventor of bitcoin, which he has denied.
Smart contracts are defined as computerized transaction protocols that execute terms of a contract. He wanted to extend the functionality of electronic transaction methods, such as POS (point of sale), to the digital realm.
Szabo also proposed the execution of a contract for synthetic assets, such as derivatives and bonds. “These new securities are formed by combining securities (such as bonds) and derivatives (options and futures) in a wide variety of ways. Very complex term structures for payments can now be built into standardized contracts and traded with low transaction costs, due to computerized analysis of these complex term structures.”
In simple words, he was referring to the sale and purchase of derivatives with complex terms.
Many of Szabo’s predictions in the paper came true in ways preceding blockchain technology. For example, derivatives trading is now mostly conducted through computer networks using complex term structures.
Smart Contracts today are used in DeFi (Decentralized Finance) to create & generate wealth through Liquid provider tokens (LPs)
This is a non physical way of creating crypto and it is based around the fundamentals that you can stake your asset, or you can use DeFi by which you add your funds to a giant liquidity pool in which the more funds in it, the easier the flow of transactions in and out to bounce off other currencies against it. In short you get paid handsomely to be an automatic market maker through whats called ‘smart contracts’
In return for staking your assets in these liquidity pools you are paid a live constantly rolling interest payment that works out on average maybe 100% per annum. These interest payments can be capitalized and compounded in your initial investment.
In other words, whilst you buy and hold a crypto, you are earning a constant high yielding dividend payment on it and still have the ability to move funds in and out without any hindrance or clauses.
Here are 2 of the DeFi platforms that are popular that I have experience in using:
PANCAKE SWAP https://coinmarketcap.com/currencies/pancakeswap/
To put the incentives into perspective:
Currently right now on one of the most popular DeFi exchanges, you can earn up to 120.47% APR (at time of writing) compounded and capitalized as often as you want.
At the start of the year some of these pools were running at 500-600%+ APR compoundable.
The SHF model worked prior to May 4th by utilizing these exchanges. NSCC 802 curtailed the bulk of that leaving little choice but to store excess funds on 0% in overnight reverse repos, essentially going from highly profitable assets to assets being eaten by inflation.*
The US 2yr treasury is 0.16% yield
The US 5yr treasury is 0.78% yield
The US 10yr treasury is 1.49% yield
The average ETF investor earns 8% APR
The average SP Index investor earns 10% APR
*at time of writing, now currently increased to 0.05% 21/06/21
SO YOURE WONDERING RIGHT NOW WHY IN THE FUCK AM I TALKING CRYPTO ON SUPERSTONK?
First we need to consider what money we are talking about, where is it coming from, any previous proof, paper trails to consider or unusual correlations.
We know of the correlations with KOSS and other meme stocks.
THE BACK STORY: Looking closer:
Please check below a chart of GME VS USD/ETH/BTC
When there is a large price INCREASE in GME the price of ETHEREUM goes DOWN $1USD compared to GME
When there is a large price DECREASE in GME the price of ETHEREUM goes UP compared to 1$USD GME.
If it is is a small change in gme price the correlation is not necessarily there but it is ALWAYS there when there a substantial net change and ALWAYS follows the same pattern
Compared to the day before.
Basically the price of ethereum compared to 1$USD changes based on large changes in GME price and it is dependent on a rise or fall and ALWAYS follows this pattern
compared to the day before price
All we need to do is see the closing price of ethereum and other tokens compare them to gme price and you can find significance based on price change ALWAYS
In a very quick TLDR:
You can use Bitcoin to purchase tokenized stocks which are then convertible to the real stock so if you purchase the stock with Bitcoin while Bitcoin is high then it costs less bitcoin to buy the stock especially if you pumped the market in preparation for it.
so pump crypto market then buy your GME shares through tokenized stocks. The broker comes out even or a bit ahead since the tokenized stock trades a couple dollars higher than the real stock and the short hedge funds just bought GME with an inflated currency compared to $USD.
The crypto rule that dropped the price may have prevented this and it shows on the inflation comparison of crypto compared to GME
The tokenized stock market was a way to purchase their FTDs at a lower price then screw crypto holders after
I included a graph in the analysis of the change in price from the previous day of GME, ETH, and BITCOIN. I misunderstood the data when I first reported it, it appears ethereum and bitcoin get pumped with GME
As you can see there is some correlation for sure with GME and the Top two Cryptos. The correlations seem to diverge after march and correlate strongly on the highest FTD cycles and accompanying price drops.
I will dive deeper into this correlation later in this DD.
WHY IS THERE A CORRELATION?
Where is all the money going to from naked short selling?
It is my belief that It is the same money
This leads me onto my follow up question:
WHERE’S IT COMING FROM AND GOING TO?
Naked short selling globally, Lucy Kosimar stated the UK was far worse than the USA – its a global problem.
Being a British Ape this caused alarm bells to go off in my head and then it dawned on me just how large a scale of a problem this is.
An interesting example:
Citadel Securities banned for 5 years in china because of illegal practices:
The key points we need to take away from this article:
- The usage of HFT (High Frequency Trading) taking advantage of loopholes for arbitrage purposes (don’t worry we will briefly cover arbitrage) This will be important later on.
- Futures trading
- Citadel were probed for “SPOOFING” a practice that involves placing and then cancelling orders, distorting the price in the process***
HEDGE FUND PREDATORY USAGE OF GLOBAL “MALICIOUS SHORT SELLING”
Q. Now where have we seen that happening before?
A. Well stonks!
It will take for them to be liquidated to be covered.
If a short sold GME share is costing Citadel securities in interest for example, then to at least make the balances a net position, they need to look for somewhere that they can place the funds. All of a sudden the influx of buy orders increases; this was not part of the plan. Citadel needs somewhere that can get a return of more than the interest on the borrowed shares to remain net neutral at best.
Time to put on the thinking cap.
Holding cash it’s expensive, time is your enemy. TICK TOCK.
Say for example: I had a MOUNTAIN of cash like Pablo Escobars then as long as it can be parked somewhere safe, I don’t care if I lose a small % due to rats and inflation. At the end of the day I own it, it’s my money, I can do what I want with it.
The Short Hedge Funds dilemma:
Not just Citadel Securities, but numerous financial institutions have the same problem…….they currently hold TOO MUCH MONEY. But get this…it’s a bit harder to fix.
You see, they don’t own the pile of money, but just possess it.
Naked short selling, simply put, is borrowed money.
Let me remind you how this compares to what a bank does….. It uses other people’s money to make profit for itself and then hands it back when asked nicely.
So having sold short hundreds of millions of shares not just across the NYSE but globally on many companies (https://whalewisdom.com/short_position/holder/citadel-advisors-llc ), all of a sudden this giant pile of cash needs a new home on the books, BUT, the fundamentals are different. It’s still borrowed money.
Unless as a bank you never intended to cover that is…..
For example, interest on say lets see, a GME share, currently works out at 1% on ave. Back in January this interest was hitting 82.9%
A SHF needs to start looking outside the box. They have amassed so much capital through short selling that accruing interest is no longer a viable option. Citadel can’t just sit on all this extra cash. It has to be put to work or else there will be problems….
The fundamentals haven’t changed; Short sold shares are still borrowed money.