Dialogue Blockstream Co creation: Bitcoin's $100000 Road

In today's program, Blockstream co founder and CEO Adam Back joined the program to share his insights on the current macroeconomic environment, the future of Bitcoin, and industry dynamics.compereMichael, BlockworksMacroSpeaker: AdamBack, Blockstream Co creation& CEOOriginal TitleThe PathTo $100000 Bitcoin | AdamBackair date November 8thThe Impact of Macro Environment on Special CoinsAdam mentioned the geopolitical and macroeconomic factors that contribute to global financial chaos, such as COVID-19, currency printing, supply chain disruptions, and political conflicts

In today's program, Blockstream co founder and CEO Adam Back joined the program to share his insights on the current macroeconomic environment, the future of Bitcoin, and industry dynamics.

compereMichael, BlockworksMacro

Speaker: AdamBack, Blockstream Co creation& CEO

Original TitleThe PathTo $100000 Bitcoin | AdamBack

air date November 8th

The Impact of Macro Environment on Special Coins

• Adam mentioned the geopolitical and macroeconomic factors that contribute to global financial chaos, such as COVID-19, currency printing, supply chain disruptions, and political conflicts. He emphasized that Bitcoin is gradually gaining acceptance and understanding from the traditional financial community, as evidenced by the interest of major US financial institutions in comparing Bitcoin related financial products.
• Adam believes that the recent surge in Bitcoin prices has attracted the attention of institutional investors and traditional financial experts. Now is the time for Bitcoin to gain more adoption and acceptance, especially in the near future when spot exchange traded funds (ETFs) may be approved. However, he warned that investors should be aware of the potential risks associated with Bitcoin custody ownership, as it may compromise the anti censorship characteristics of cryptocurrencies.

Investment portfolios other than bonds

• Adam mentioned that when interest rates unexpectedly rise, investors holding large amounts of long-term government bonds will suffer losses. In this situation, investors need to reassess their investment strategy and consider alternative assets that can provide long-term value and growth, such as Bitcoin.
• Adam pointed out that given the current bond market conditions, the traditional investment strategy of allocating 40% to bonds may need to be modified. He suggests adding Bitcoin to investment portfolios as a means of storing long-term value, unlike gold, which is mainly used for hedging.

Watch Duo Lightning Network

• Adam believes that Bitcoin is undergoing a mature and stable cycle, gradually being recognized as a digital asset with long-term value storage and asset preservation functions.
• Adam predicts that Bitcoin prices may reach$100000Adam$100000
• Adam pointed out that the Lightning Network is a second layer solution based on Bitcoin blockchain technology, aimed at improving the transaction speed and scalability of Bitcoin. Through the lightning network, users can make fast, low-cost small transactions without having to record every transaction on the Bitcoin main chain.
• The development of lightning networks has had multiple impacts on Bitcoin. Firstly, it can improve the transaction speed of Bitcoin. Due to the long transaction confirmation time on the Bitcoin main chain, the transaction process is slow. Through the lightning network, transactions can be conducted on the second layer network, almost in real-time, greatly improving the transaction speed of Bitcoin.
• Secondly, lightning networks can also reduce the transaction costs of Bitcoin. The transaction costs on the Bitcoin main chain increase as network congestion and transaction volume increase. But through the lightning network, users can engage in low-cost or even free small transactions, which will further promote the use and popularization of Bitcoin.
• The development of lightning networks can also improve the scalability of Bitcoin. As the number of Bitcoin users continues to increase, the number of transactions on the main chain will also increase, leading to network congestion and transaction delays. Lightning Network provides a scalable solution that enables Bitcoin to handle more transactions and easily cope with future user growth.

Bitcoin ETF

• Adam believes that introducing Bitcoin ETFs may bring more liquidity to the Bitcoin market and attract more institutional investors to participate. The introduction of ETFs will enable more investors to purchase and hold Bitcoin through traditional exchanges, thereby increasing Bitcoin's market participation.
• Adam believes that the core value of Bitcoin lies in its decentralized nature. Bitcoin, as a decentralized digital currency, has no central authority or government control. This makes Bitcoin resistant to censorship and autonomous control, allowing individuals to fully control their assets and transactions. He emphasized that this decentralized nature is the spirit of Bitcoin and the fundamental difference between it and the traditional financial system.
• Adam pointed out that the introduction of ETFs may lead to the marketization and financialization of Bitcoin, bringing it closer to the traditional financial system. This may bring some concentration risks and compliance issues with regulatory agencies. Therefore, it is called on people to maintain their adherence to the decentralized nature of Bitcoin while promoting the development of the Bitcoin market, and to seek a balanced development path.
• Adam pointed out that introducing Bitcoin ETFs will expose the Bitcoin market to the regulatory framework of traditional financial systems. This involves ensuring compliance with Bitcoin ETFs, including regulations such as KYC and AML (Anti Money Laundering). Regulatory authorities need to ensure that the operation of Bitcoin ETFs meets these regulatory requirements to protect investors' financial security.
• Adam emphasizes that regulatory agencies need to have a deep understanding of the characteristics of Bitcoin and blockchain technology and develop corresponding regulatory policies. This will help ensure the operational security of Bitcoin ETFs and avoid potential risks and vulnerabilities.

What stage of the Bitcoin cycle are we in?

• Adam mentioned that the trend of Bitcoin prices is cyclical, experiencing multiple cycles of prosperity and collapse during its existence. Rapid price increases are followed by significant adjustments, and each cycle has its unique characteristics and driving factors, including market demand, investor sentiment, adoption rates, and other external factors.
• Adam emphasizes that understanding and recognizing this cyclical characteristic is crucial for investors, as it can help them better understand and predict changes in Bitcoin prices.
• Adam pointed out that the price of Bitcoin has experienced significant fluctuations in the current cycle. Nevertheless, the fundamentals of Bitcoin remain strong, with increasing hash and adoption rates, and miners remain optimistic about the long-term value of Bitcoin. In the long run, Bitcoin shows a strong growth trend.
• Adam stated that Bitcoin has evolved from an edge technology experiment to a widely recognized asset class, with sustained development of core values and technological innovation. Over time, Bitcoin has gained wider recognition, especially in the traditional financial field, where more and more institutional investors and financial service companies are exploring and adopting Bitcoin.
• Adam believes that the integration of Bitcoin with traditional financial products, such as Bitcoin Exchange Traded Funds (ETFs), provides a more accessible and understandable way for traditional investors to invest in Bitcoin, further promoting its acceptance in mainstream financial markets. Although the regulatory environment varies in different countries and regions, the overall trend is towards a better understanding and regulation of this emerging market.

The impact of BitcoinOrdinals

• Adam pointed out that Ordinals is a native NFT form of Bitcoin that is implemented through UTXO (unburned transaction output) arranged in a specific way. With the recent Taprot upgrade, this approach has become possible, allowing for the creation and dissemination of these OrdinalNFTs on the Bitcoin blockchain.
• Adam mentioned that the emergence of Ordinals may have led to a new perspective on the Bitcoin blockspace. This new use has sparked controversy in the community, with some believing that Bitcoin should be primarily used for financial transactions, while others believe that if the code allows this use, then it is reasonable.
• Adam pointed out that each JPEG image is approximately 100KB, which may replace hundreds of financial related UTXOs, which may result in some emerging market users being unable to perform cold storage on the main chain and having to use hosting services or exchanges. This situation indicates that although Bitcoin is a free market, due to limited block space, it may ultimately be those who are able to pay higher fees who have an advantage.
• Adam also mentioned that Bitcoin has developed adaptively based on user behavior, market conditions, and solutions built by technology providers. For example, due to the emergence of Ordinals, some technological solutions have been forced to adapt to new economic conditions, thereby improving the scalability and resilience of Bitcoin networks.