- Strike’s CEO sees Bitcoin increasing in value after the halving.
- The director believed that Bitcoin scarcity made it immune to humiliation.
After a week of ups and downs, Bitcoin [BTC] started off strong and managed to claim the $70,000 mark again on March 25. At the time of writing, BTC was exchanging hands at $70,967, up 12% from the past week.
With the halving taking place in less than a month, experts expect a further price increase. In a recent one interview Jack Mallers, CEO of Strike, shared his insights with Bloomberg. He said,
“Bitcoin has a fixed issuance schedule…and so the very simple way to think about it is that if demand stays the same and Bitcoin sold is halved, this should have a positive impact on the price.”
Reduced rewards for miners to influence sustainability
While halving may be good on the price front, its implications are for the worse miner rewards cannot be ignored. Ergo the question: how will the network sustain itself since miners will mine less?
Mallers pointed to transaction fees as a viable source of revenue. He noted that blocks have recently generated more fees for miners than the actual block reward.
The director referred to the auto-adjusting protocol that manages difficulty based on total mining power, confirming that the network is built to be self-sustaining.
This is in line with Satoshi Nakamoto’s original view that transaction costs are the most important source of revenue.
Therefore, Mallers believes that concerns about the future sustainability of the network will be decades away, making them more theoretical than practical.
Bitcoin against inflation
Mallers emphasized the core problem of the government controlling the money.
He argued that the government’s ability to print more fiat money to combat debt has led to inflation and asset devaluation.
Nevertheless, BTC shines in an economy where the supply of money can be diluted at will. The director noted:
“They can create more real estate. They can find more gold. They can no longer make Bitcoins….aaccess to Bitcoin is of utmost importance. It’s a great use case because it’s the one thing no one on the planet can create anymore.“
Bitcoin’s scarcity compared to other assets makes a compelling case for its appeal as a hedge against the inflationary tendencies of centrally controlled currencies.
Stablecoins vs Bitcoin
Bitcoin’s advanced technology may be attractive to many, but not to everyone. So, what’s the other favorite asset? The director pointed stable coins, describing them as “bank deposit IOUs.” He emphasized,
“Bitcoin is the only neutral value transfer protocol in the world.”
Still, the increased preference for stablecoins in emerging markets was due to the fact that these fiat-backed tokens are relatively stable.
Additionally, the King Coin can be intimidating to many individuals, making it less attractive to those who are averse to volatility.