Before diving into the content of the post, let's be clear about something... Consider the crypto ecosystem of 3 years ago and today's crypto ecosystem and tell me: But for Lightning Network, Are there any groups trying to fit Bitcoin into "everyday-currency" form?
We should separate two different forms of money from each other: store of value and currency for a medium of exchange. Store of value is for bad days, not for everyday usage, and it lacks scalability, mobility, and usability features in general such as Gold, Silver, land of an area, etc.
On the other hand, currencies are for instant trading of values. For example, I'm a farmer and I sold my products. I store some of the value that I created and I use a part of the value to exchange with something else (that is also a product of value by someone else)
The system more or less works in this way. Now, I think we all can agree on the fact that Bitcoin is acknowledged as a Store of Value by many. There are both technical and fundamental reasons behind this perception. However, I believe that it is better for all of us; I mean all mankind as we need sound money more than ever 馃槄
Institutional FOMO
Seeing the upcoming waves of Blockchain productions, institutions had always been observing the situations very closely. However, there was no step taken by any of them until recently. At the moment, we can talk about institutions holding Bitcoin in their portfolio as a store of value. That's not even imaginable 2-3 years ago but it is happening right now. Let's take a closer look at some of the actors and their mindset behind their investment.
As you may have come across, Michael Saylor from Microstrategy bought 17,732 BTC personally, and following his action, Microstrategy added Bitcoin to their portfolio as an investment. Besides Microstrategy, we already know Fidelity, Grayscale, Rothschild Investment Corp /il...
For further information, Please check Forbes and Ivanontech news for the list and the ongoing projects of well-known institutions.
One more source that I want to recommend one of the latest youtube video selections by SunnyDecree. In this episode, you will see a short speech by Michael S. and his vision about the future of Bitcoin. The episode
As it is clarified by Michael Saylor, if such institutions like Microstrategy buys 5 Million $ of Bitcoin and some others follow this action, then a new type of FOMO will be kicked in by these giants. That is, retail investors do not have an adequate influence on the price of Bitcoin but the purchase by institutions, as in Microstrategy, will push the price above as it is supposed to be.
The giant institutions, which are waiting for an entrance, will get into the train to buy from a relatively lower price to pile up more. If it really happens and the FOMO kicks in, then the previous bull run will be a drop in the bucket. One more parenthesis can be opened for another reality...
Paving a way for Government FOMO
Consider the actions by Iran and think about other countries that are known as Blockchain friendly. What if they welcome institutions buying Bitcoin as an investment; asset for their companies. Either the governments do not acknowledge Bitcoin as a digital investment by these companies, or they will design sound ways for taxation.
Even if the governments do not invest in Bitcoin themselves, a new way of taxation will most probably be welcomed by them as it is getting harder for local economies to survive in the post-pandemic era. The institutions may declare their Bitcoin public keys/wallet addresses for investigation and revenue. On the other hand, governments may track their digital assets and sum their taxable income. All these things can be done with ease but the initial steps, one of the most important steps, must be taken by the institutions because they have money worth taxing 馃槍
As retail investors, though unintentionally, we are assigning the use cases of Blockchain projects. Bitcoin is accepted as Digital Gold by many and the flow of money is attracting the attention of lots of Giants. Everyone is certain that the internet a gate opening a new world for you and there are different actors; rules and resources. One should take it, or leave it...
I hope both institutions and governments choose to take it so that they can catch up with the train...
What do you think about next FOMO?
Will it be institutional or smaller-scale ones as in De-Fi projects?