Ever thought that Bitcoin getting older might actually be bad for most of us?
A lot of folks in this space are still just thinking about one thing: the price, like hitting $100K or $200K and reaching new all-time highs.
But what if the big change with Bitcoin isn’t about the price anymore? What if it’s about its role?
Switching from being just an asset to becoming real infrastructure.
We often say Bitcoin is like gold, but gold is pretty much a passive asset. Bitcoin is stepping up to be active infrastructure. Just think about it a truly neutral asset that you can verify right away, which can’t be inflated and can be sent around the world without needing anyone’s permission.
This isn’t just a safe haven for value; it's a way to create trust that can be programmed.
The Quiet Change.
Right now, something pretty subtle is happening. Bitcoin is gradually gearing up to be the base layer collateral for a parallel financial system. Not loud, not flashy, but it’s happening for real.
And here’s the kicker: speculators are all about the price while institutions are focusing on the utility.
The Hard Truth:
If Bitcoin turns into global collateral, it’s likely to be less volatile over time. That also means it might lose some of its excitement for everyday traders, and those huge price spikes could become less common.
This definitely isn’t what a lot of people here are hoping for.
Basically, the more successful Bitcoin gets, the less it starts acting like the asset that people initially fell in love with.
Liquidity vs Freedom.
Here’s another angle to think about. To really become global collateral, Bitcoin needs to fit into systems like regulatory custody and institutional setups. But remember, Bitcoin was made to steer clear of all that. So we’re left with a paradox. Does growing acceptance actually strengthen Bitcoin, or does it slowly mold it into something else?
Most people being delusional does not make them the normality. Bitcoin WILL have rarer 'extreme pumps' and everyone has to get used to this. The easiest way to prove this is by looking at its Market Cap. Another set of 'extreme pumps' would place the Market Cap above any other Asset in existence. If it keeps going forever through the sky, it would mean the financial system is simply done. Demolished. If people hope for this, they are probably not aware of what they are actually hoping for.
From my standpoint, those who would benefit more from Bitcoin in the future are those who are strong and disciplined holders.
With the ETF being invested in by large pocket holders and institutions, Bitcoin's core utility would be in their control as we can already see when whale movement happens as compared to those who trade it or individual long term holders.
No matter the upgrades or infrastructure that is built to make it more developed, the truth is that self custody would decide Bitcoin's independence and utility use case.
What is its activeness based on? In case you didn't know, most gold is actively used for wealth validation (jewelry). The most remaining gold supply is held in central bank reserves, which then force you to use fiat to replace gold (activiteness represented).
Bitcoin's inherent utility is: censorship-free, trustless, and borderless transactions. Even if you just got your first bitcoin a second ago and want to spend it by implementing the wallet's security rules and adhering to the network's protocols, you're gaining Bitcoin's utility.
What kind of infrastructure is this? Aside from cryptocurrencies and decentralized finance, Bitcoin has no real financial use and is typically used within centralized systems. I believe the infrastructure phase hasn't even begun yet.
But I think it won't happen. So simply put, they want absolute control to be within a country's government system. Because of this system, in the near or distant future, I think Bitcoin will only be used as an asset that has value because of trust. The state or government will only try to regulate through external rules that become users' obligations. They cannot regulate the Bitcoin system. But if Bitcoin is trusted and becomes a new system, then currently, longtime users will benefit the most, followed by large institutions that have long accumulated Bitcoin. IMO
We don't need to think about this for too long. If Bitcoin becomes the foundation of a new financial layer, then obviously its price will skyrocket. Then, if you are asking whether the early users will benefit or not, it is inevitable that they will benefit since these pioneers bought Bitcoin at a very low price and now can sell it for more than 1000x or more. It is not whether the institutions will capture the majority of Bitcoin utility or not, it is about whether a person is holding Bitcoin to sell or not.
Btw, if Bitcoin's next phase is structural, the market will obviously react, if the structure of Bitcoin is laid out strongly, then the next event will be a Bitcoin price surge.
I don't think it will happen but If Bitcoin somehow becomes the foundation of a new financial layer, I will say early adopters who held tight will benefit the most. They bought in cheap and held through the ups and downs so they will reap the rewards as the price keeps breaking ATHs. Institutions might cash in on services and financial products but they will never truly own the asset. Self custody will be the key to maintaining Bitcoin's independence no matter how institutions try to get involved.
Institutions don't have full control of Bitcoin, so I think they can change the cycle. It's already improved since before; there's a bearish and bullish on every cycle.
Why not compare it with the current situation about the crude oil where the supply is tight? Did you see the price surge?
In Bitcoin we have an event where the supply drops by half; they call it "block halving," so every 4 years the block rewards will drop to half. So supply will be affected, causing a price surge. Why? Because the price of bitcoin is based on demand and supply, it is the same as other stocks, indices, or gold as sample where the price is based on demand and supply.
If you understand that, it should clear out your doubt about being fully controlled by big whales and institutionals.
Is not Bitcoin an infrastructure by design? The moment Bitcoin launches, it already function as an infrastructure. It has protocol, miners, nodes, wallet, and services that enable an infrastructure for money transfer, that said, Bitcoin is a monetary system, which we all know is a kind of infrastructure.
Depends on who makes use of the opportunity.
What if it no longer went up in price? Then nobody would care about it anymore .
Bitcoin can do that, but so can many other products that are faster, cheaper, and more easily programmable. Products like Hedera are doing well in the "infrastructure" space for instance.
We had this discussion in another thread: is Bitcoin's volatility a bug or a feature? My conclusion? It's a feature. Without volatility, speculators will not be interested in Bitcoin, and the only unique value Bitcoin has is as a speculation instrument.
Bitcoin is a victim of its own success in that it effectively caused all digital currencies to be legal, meaning that you can now do what you did with Bitcoin when it began completely above board, without fear of government intervention. That means a complicated scheme like Bitcoin is no longer necessary and other technologies work much better.
Bitcoin is in ETFs and basically very investing app out there, and can be traded just like you trade stocks. That's about as mainstream as it gets.
Will this "strengthen" Bitcoin? It depends on what you mean by "strengthen".
We do, because the law of supply and demand still applies. So if it becomes a new layer of finance then the demand will increase. And by that means that the price should reflect on that upwards.
Early investors or not, as long as you're continually having it then the volume gets to move upwards. You're part of those who will benefit from it.
The volatility that it has got is always an opportunity for us. Whether it increases or decreases, we have to know how to react appropriately.