The Bitcoin ecosystem is under a renewed spotlight as the price of the largest cryptocurrency hovers around $42,000 for the first time since April 2022.
Joining us now to reflect on Bitcoin's developments in 2023 is CEO of Bitcoin financial services firm Swan Corey Clipston Al Long with co-founder of Stax at Bitcoin Lay two protocol for smart contracts. M Ali. Welcome to the show, Corey and mane. Great to be here. Thanks for having me. Awesome. Thanks. Thanks for having me. Good to see you, Corey. You as well, sir. All right, awesome. Let's get into it. As we know Bitcoin is hitting highs that we haven't seen in over a year. Corey, I want to start with you when you reflect on 2023. What's the most exciting development that's happened for the Bitcoin network? Yeah. So overall for the ecosystem, I'd say the most exciting thing that's going on and I've been talking about this a lot lately is the replacement of the top of funnel for new people getting into Bitcoin the last six years. It's been the world of VC funded crypto, non Bitcoin crypto trying to pump their tokens and, and spend $50 billion of VC funding on marketing. And now that's getting replaced with the largest, most trusted financial firms in the world. Talking about Bitcoin itself. So when you think about maybe the end goal for a company like ours or just for the Bitcoin ecosystem of getting people to take self custody of their Bitcoin and actually understand deeply what it is as a money and as a technology, it's a much better top of funnel that we are swapping and, uh, right now and I think that remains dramatically, uh, underpriced. Um, just swapping out. Does this mean that you, uh, I, I mean, I kinda know your answer here. It is there almost no room for ALTs? Oh, hi, Lawrence. Good to see you as well. Uh, you know, people, people love to gamble and they love lotto tickets and they love playing numbers and they love casinos and I think, you know, if anything, we've seen that human nature doesn't really change and you don't need much more than a meme to attack to, uh, you know, a security or a gambling proposition of some sort and people will play it. So it's really just a matter of, of, you know, letting that kind of run its course. What I do really like and what I think is it has been achieved over the last couple of years is almost anybody that gets into this space at this point and everybody that's in the space already really does have a pretty clear demarcation between Bitcoin and non Bitcoin crypto in their mind and there isn't really any sort of meme about any of the alt coins ever being a better money than Bitcoin. So it's kind of separated itself and in the minds of everybody in the industry. And I think that's really clear when people come into the space. Now, that's the information that they're getting from all sources, from media, from government, from everyone in the industry, everybody on Twitter. And I think that was a heck of accomplishment over the last couple of years by people working their butts off in Bitcoin. Man. I want to turn to you now when it comes to the development of the network, what what's the most prominent thing that happened in 2023 that sticks out in your mind? Yeah, I think 2023 in my view was actually one of the best years for Bitcoin. Um and it like probably in the last 10 years. So I started in 2013 and I would, I would rank 2023 as the best year for Bitcoin. And I think it's mostly for two big reasons uh with things like Cardinals and Bitcoin LWS, we actually started seeing uh competition for block space and which is extremely important, right? Like if you look outside of the Bitcoin world and the rest of the industry, some of the biggest criticisms for Bitcoin would be like around the security budget that how are you going to pay for Bitcoin security in the long term? When, when the Coinbase rewards go down or there would be criticism around developer activity like, hey, how many developers are you guys getting, how many start ups are getting started and people building on Bitcoin? And now there is like real data out there because of oral where Bitcoin fees have actually flipped Ethereum in the, in the last weeks, which is huge, right? Like we were nowhere close to this two years ago. And I think similarly, we are now seeing that there are more transactions happening on the Bitcoin network that are cardinals and other things than, than just the payments and stuff which which has just opened up everyone's eyes to, hey, what else is possible on Bitcoin? And that thing is very important in trying to build a Bitcoin circular economy. And we have seen the interest in Bitcoin L twos just go through the roof. I think there are like 10 plus different projects that got started. And and I'm of the view, obviously, Stax is is doing a major upgrade trying to be close to a Bitcoin L two and have BT C as the main asset that gets used there. But there are new projects that are starting like people are trying to bring ZK roll ups to Bitcoin. People are trying to start different types of L two S and I think we need that experimentation. So for me, the biggest thing that happened in 2023 was developer activity and with things like cardinals the demand for Bitcoin block space just going through the roof. And I think that just solidifies Bitcoin at the number one spot instead of like worrying about other, other networks that are gaining more developers or gaining more users and, and, and getting these applications that that other network, I assume uh would be Ethereum. And, and uh what does this all mean for Ethereum layer two? What does it all mean for is Bitcoin taking those developers away as you, as you're saying, is that, is that what you're implying here? I think, I think we're seeing clear evidence, right? There, there were top NFT marketplaces that were on Ethereum and they switched their focus to Bitcoin. They, they started focusing on Bitcoin. We are seeing a lot of developers like when a new developer starts in this industry, I think the mental model should be that we are in an industry that's expanding but rapidly expanding and new people are entering it all the time when people were entering this year. I think building on Bitcoin was a serious option that they were concerned, right? Even if there are more still more infrastructure challenges or or depth tooling that needs to be built on Bitcoin, people are getting it that Bitcoin is the the Pristine asset as Corey was saying like, you know, but Bitcoin is separated itself as an asset. We were trying to see how Ethereum was trying to be ultrasound money and we are seeing that fade away compared to Bitcoin the asset. But Bitcoin has a technology platform where developers can come and build anything. I think it's ok to admit that other networks like Ethereum or Solana were doing a better job there. So now that's maybe no longer the case that much, right? Things are getting good or better, very, very rapidly. And that's a really good thing for Bitcoin because now when new developers, fresh talent comes in, they look at the great properties of Bitcoin, but the downsides aren't that big anymore, right? So they would, they would they are more likely to decide to build on Bitcoin. And we've seen a rapid increase the number of start ups just in our ecosystem or the broader Bitcoin L one ecosystem getting funded, hiring great developers and building building cool things. And I think that that just makes me really excited. Well, Corey man is talking about new developers, I want to talk about new uh new investors, new, new folks who want to dabble with Bitcoin after the implosion of FTX and now finance settling with the DOJ here in the United States. Uh How has that affected users on Swan? Do have you seen new users or is it the same people who've been there for a while who are interacting with the platform? Yeah, it's, it's hard to parse where the influx of new users comes from like is it people fleeing crypto or is it just new people getting drawn in as they always do by a price rise. But yeah, we've certainly seen a massive influx in users with this price rise from, you know, 25 K up to over 40 k now. Uh As always happens when there's a price pump. Uh The nice thing about Swan is even when the price drops. Uh we have a lot of folks that see that as Bitcoin on sale and so it doesn't really uh negatively affect our volumes unless it's sort of down sideways for, for years or more. Um So yeah, it is, it is a very, very exciting time and again, the signal around Bitcoin has never been stronger. And yeah, you even have the, the crypto inclined or the alt coin crowd uh actually promoting Bitcoin as well as we noted. Uh So it is, it is kind of an interesting moment in time here, uh rounding out 2023 and again, heading into the very good likelihood of some ETF S getting approved in January. Uh It's just a lot of tailwinds here for Bitcoin.