Matsumura says that the halving cycle involves an inherent Schelling focal point mechanism, which is a game theory concept and social phenomenon where people or organizations can coordinate without communication. <\/p>\n
\u201cIt\u2019s important to think about it as a psychological training phenomenon because each time it works, it inclines people to go with it the next time it happens.\u201d<\/p><\/blockquote>\n
He also suggests that Bitcoin\u2019s stock-to-flow model clearly shows that the actual cut in BTC supply is getting smaller with each halving, which means \u201cthe actual mathematical economic effect is smaller.\u201d\u00a0<\/p>\n
<\/p>\n
J\u00fcnger echoes these sentiments by highlighting the deflationary mechanism of the Bitcoin protocol and that there\u2019s never talk of halving the fiat money supply. <\/p>\n
\u201cIt\u2019s just such a foreign concept to everything with fiat money that every time it occurs, it\u2019s just such a celebration of we\u2019re doing something completely different here.\u201d<\/p><\/blockquote>\n
Yung provides another interesting perspective, noting that while Animoca Brands has just two projects that directly work in the Bitcoin ecosystem out of some 500 investments, the preeminent blockchain remains \u201cvery impactful\u201d in what it does.<\/p>\n
The Animoca CEO says the effect is similar to any business where interest rates, employment figures and other big macroeconomic signals have an impact even if they\u2019re not directly impacting you. <\/p>\n
\u201cSo, for us, I think Bitcoin is our central bank. With that in mind, I think of Ethereum as our investment bank.\u201d<\/p><\/blockquote>\n
Bitcoin ETFs and consumer protection<\/h3>\n
The pending approval of several spot Bitcoin ETFs in the United States is being widely cited as a significant driver of BTC\u2019s recent appreciation in value into the mid $40,000 range. Yung offers a very short takeaway as to why this is the case:<\/p>\n
\u201cThe potential income from bitcoin ETFs is estimated to be $10 to $12 billion.\u201d<\/p><\/blockquote>\n
For an exchange like Binance, the potential for an immediate price spike is another important consideration that could test the systems of a number of global exchange operators.<\/p>\n
\u201cThese kinds of events are critical in running the exchange. It\u2019s a matter of succeed or fail in terms of providing the underlying infrastructure when the news goes out and you see that green wick,\u201d J\u00fcnger explains.<\/p>\n
Related: Binance is now \u2018totally different\u2019: Interview with CEO Richard Teng<\/em><\/strong><\/p>\n
Binance\u2019s regional director adds that consumer protection is set to fundamentally change with the provision of a spot Bitcoin ETF, which provides a compelling proposition that will drive investment into the asset class:<\/p>\n
\u201cAll of a sudden, with this ETF vehicle, you will no longer have synthetic financial instruments that reflect the price of Bitcoin. You have an actual spot. It\u2019s all secured. It\u2019s all in custody.\u201d<\/p><\/blockquote>\n
A cautious approach<\/h3>\n
While there is a sense of euphoria and talk of crypto winter beginning to thaw, Leite offers a sobering perspective given Polkastarter\u2019s role in incubating and guiding cryptocurrency startups through a tough two years.<\/p>\n
\u201cDuring the bull market euphoria, a lot of companies overspent; they didn\u2019t build a treasury, which is super important,\u201d Leite explains. While those that have survived are looking ahead to better times, he advocates for a cautious approach:<\/p>\n
\u201cWe still advise them not to mind that everyone is excited. You must have a long-term intelligence; make sure that you have a runway for a few years.\u201d<\/p><\/blockquote>\n
The recent enforcement action against Binance and its subsequent $4.3 billion settlement with the U.S. Justice Department was also described as a positive development for the wider industry that assuages any fears of the future operations of the world\u2019s largest exchange by transaction volume.<\/p>\n