Bitcoin 2022 Conference Recap
Last week our CEO, Rami Korhonen, had the opportunity to participate in the most attended Bitcoin conference ever organized, Bitcoin 2022, in Miami, USA. With 25,000 participants and the all-star cast of speakers, he learned a lot during the event. Here are some of his observations.
Bitcoin and Institutions
The institutional adoption of Bitcoin was one of the conference’s main themes. Large institutions are increasingly taking notice of its staggering rise from an obscure cypherpunk experiment to roughly a trillion-dollar asset in 13 years.
One of the major announcements at the conference was the Bitcoin payments app company Strike’s deals with Shopify and two of the world’s leading Point of Sales (POS) companies NCR and Blackhawk. Later this year, institutional partnerships will allow people to instantly purchase goods and services in hundreds of thousands of businesses with bitcoin.
The merchants accepting bitcoin payments benefit from instant settlement and close-to-zero fees compared to what traditional credit card companies charge. This can provide businesses with easier cash flow management and better profit margins when 3% credit card fees are replaced by close to zero percent fees.
In Strike CEO Jack Maller’s’ presentation, one thing that was not discussed was how people will keep track of capital gains taxes when using Bitcoin for regular payments. In most countries, including Finland and USA, every bitcoin payment triggers a capital tax event. It will be interesting to see how people handle the accounting side of bitcoin’s everyday use in the future.
Bitcoin and Banks
Another exciting development is that more banks are adding Bitcoin-related services to their service portfolios. A representative of the US company Bakkt told the audience that there has been a considerable shift: A few years ago, bankers asked why they should look at Bitcoin. Today they are asking how they could get involved.
Furthermore, he explained that many banks feel the need to participate due to simple consumer demand: The banks see how much money leaves consumers’ bank accounts for crypto-services, and they also receive an increasing amount of customer feedback asking when people can start investing in bitcoin through their bank.
Oivan’s new white-label Bitcoin Saving App Hatch offers banks a straightforward way to provide a service, with which the bank’s customers can easily buy bitcoin, store it, or send it to their own bitcoin wallet. Hatch can be fully embedded in the bank’s existing banking app.
Read more about Oivan’s new white-label Bitcoin Saving App Hatch.
Bitcoin as Treasury Asset and ESG Considerations
Many sessions discussed the next wave of institutional adoption of bitcoin as a reserve asset. Several public companies, such as Tesla, Block, and MicroStrategy, already have significant bitcoin allocations, and many speakers discussed what it will take to get top hedge funds and sovereign wealth funds to deploy more capital in bitcoin.
ESG (Environmental, Social, and Governance) compatibility of bitcoin mining is one of the perceived obstacles for many large institutions, and the Bitcoin community is divided on how to tackle the issue. On the one hand, many influential thinkers and companies are tackling the ESG issue head-on by focusing on renewable energy and providing transparent reports on the carbon footprint of their operations.
Bitcoin mining companies are also taking concrete steps to make their operations carbon-free: Blockstream’s CEO Adam Back announced a solar-powered bitcoin mining operation cooperating with Tesla and Block. Companies that openly engage in the ESG discussions believe that enormous sums of capital can move into the Bitcoin economy once the world is convinced that the mining industry meets ESG standards.
On the other hand, many bitcoiners feel that ESG narratives are tools for legacy institutions to seek control and slow the growth of Bitcoin. The prominent Bitcoin podcaster, and venture capitalist, Marty Bent said that the Bitcoin industry should stop engaging with the ESG narrative. His reasoning is that even if the Bitcoin industry would reach specific ESG goals, the legacy institutions would just add more ESG burdens for bitcoin miners in a never-ending cycle.
Indeed, ESG is often used to single out Bitcoin mining, while people rarely question other domestic and industrial uses of electricity. For example, Bitcoin mining worldwide uses less electricity than clothes dryers in the USA according to reports. Furthermore, an increasing amount of mining is powered by renewable energy. Cambridge Centre for Alternative Finance estimates that 20-70% of bitcoin mining is already based on renewable energy. The Bitcoin Mining Council, a voluntary industry advocacy group, reported that in the last quarter of 2021, 58.5% of bitcoin mining was based on renewable energy sources.
Many famous speakers at the conference, including Peter Thiel and Kevin O’Leary, seemed confident that we are still in the early days of institutional adoption and that trillions of dollars will flow into the Bitcoin ecosystem in the future.
Bitcoin as Human Rights Tool
One of the most impactful sessions was the panel discussion hosted by the human rights activist Alex Gladstein, featuring three human rights activists worldwide. Yeonmi Park, Farida Nabourema, and Fadi Elsalameen told moving stories about the financial repression they faced. I highly recommend everyone to watch the speech. Watch video, Bitcoin is Freedom – Bitcoin 2022 Conference.
People in the ascending world often view bitcoin as a critical tool for financial empowerment, while people in the western world often view bitcoin as a speculative investment. I highly recommend Mr. Gladstein’s new book Check Your Financial Privilege for people who want to learn more about how Bitcoin is helping underprivileged people around the world.
Bitcoin as Open-Source Movement
While the main stage was full of big-name speakers, in some ways, the real action of the conference happened at the Open-Source stage, hosted by the Bitcoin privacy activist and prominent podcaster Matt Odell.
The level of talent and dedication in the Bitcoin open-source community is astounding. Less talented developers are making millions by launching flashy altcoin projects left and right, while the Bitcoin open-source developers quietly work on making Bitcoin more usable for everyone.
Speakers gave the audience deep dives into the technical details of developing new privacy and scaling features into the Bitcoin protocol and what kind of challenges the developers are facing.
After hearing these experts speak, I am confident that Bitcoin core and Lightning Network developers will find ways to elevate the world’s fairest money into a tool that everyone can use safely and efficiently in the future…
Thanks to Slush, the massive startup event based in Helsinki, I had an excellent benchmark for how huge conferences are organized. The Bitcoin 2022 team organized a fantastic event where it was easy to move around, learn, network, and be inspired.
The open-minded approach from the organizers was also encouraging: The closing session featured the theoretical physics Eric Weinstein and Avi Loeb discussing how decentralization can elevate our search for extraterrestrial life and how the discovery of Bitcoin may help humanity break the constraints of Einstein’s theory of gravity.
The world around us is as volatile as ever, but Bitcoin keeps producing indisputable truth, block by block. Bitcoin’s supporters hope it will provide a lifeboat for as many people as possible if the world’s central banks run out of ideas on how to keep the current financial system operating. At Oivan, we are always happy to discuss Bitcoin-related topics, so let us know if you want to have a chat.