Bitcoin has stood the test of time. Buying bitcoins today is much less risky than it was 10 years ago

Bitcoin is part of the treasury of hundreds of institutional investors like Microstrategy, Tesla, Block.one, Tether, SpaceX, and also The Blockchain Group in France.

Some were fortunate enough to get bitcoins for a handful of figs, but aside from a few cypherpunks, very few people kept them. There was a time when you could visit a site to get 5 BTC for free and pizzas were bought for several thousand BTC.

Millions of BTC were lost because no one really believed in it. Putting all of one’s savings into it was, rightly so, seen as irresponsible. Ten years later, that is no longer true.

1 – Increased adoption and institutional support

Bitcoin is part of the treasury of hundreds of institutional investors like Microstrategy, Tesla, Block.one, Tether, SpaceX, and also The Blockchain Group in France.

Not a week goes by without a major group announcing bitcoin as their main treasury asset. It was the Chinese textile firm Addentax (8,000 BTC) this week, and Twenty One Capital the week before (42,000 BTC). Soon Amazon?…

Major banks will soon accept bitcoin as collateral (Goldman Sachs is considering it). Twenty One Capital will be the first serious company to offer loans collateralized by BTC. The offered rate (12%) is spicy, but will decrease thanks to competition.

States are also involved, and no small players. The government of Donald Trump clearly wants to make bitcoin the United States’ reserve currency, as highlighted by a recent Morgan Stanley estimate. Senator Cynthia Lummis even proposes selling gold to accumulate it.

Overall, it is estimated that exchanges collectively have between 100 and 200 million active clients. That’s just as many potential voters to satisfy… And by the way, 50 million bitcoin addresses have a balance above zero, suggesting up to 50 million “hodlers” (probably ~15 million people).

2 – Accessibility and security

The approval of Bitcoin ETFs in the United States last year was a turning point. Over 41 billion dollars have been invested via BlackRock, Fidelity, and others.

The regulatory easing brought by the new US government suggests that major banks like BNY Mellon, State Street, and Citi will join in the coming months. U.S. Bank (the fifth largest retail bank) and Revolut already hold bitcoins on behalf of their clients.

Buying and storing bitcoins is no longer as complex and risky. While one million BTC were hacked between 2009 and 2020, only 4,500 BTC have been hacked since 2020. That’s 450 million dollars, compared with 130 billion dollars in bank card fraud.

It is now child’s play to buy bitcoins via user-friendly and secure applications. Not to mention the myriad of hardware wallets allowing full ownership of bitcoins (Trezor, Ledger, Safepal, etc.).

The Bitcoin network is also much safer than ten years ago thanks to the increase in “hashrate.” We are now at 800 billion billion hashes per second (800,000,000,000,000,000,000 h/s).

Reaching 800 EH/s would require manufacturing 4 million Antminer S21s and investing 12 billion dollars. In short, the likelihood of a state taking control of the network to undermine its growth has become minimal.

This computing power ensures true decentralization and strengthens the long-term investment thesis.

3 – Geopolitical and economic contexts

The global economic landscape has changed significantly since 2015. The 25% inflation of the last five years has severely eroded purchasing power. For many, it was their first experience with high inflation after 30 years of controlled inflation, around 2% per year.

Some countries have experienced much more dramatic inflation rates. Notably Turkey (750%), Argentina (2,500%), and Venezuela (1,000,000% in 2023).

It is therefore natural that bitcoin is increasingly attracting interest as a hedge against the depreciation of national currencies. BlackRock’s CEO did not mince words in his annual letter to investors:

The United States has long benefited from the dollar’s status as the dominant global reserve currency. But this privilege is not guaranteed in perpetuity. If the U.S. fails to control its debt and allows its deficits to grow uncontrollably, Bitcoin could wrest its status as the international reserve currency.

Add economic difficulties to geopolitical tensions, and it is not very surprising that a stateless, uncensorable currency like bitcoin stands out.

Taiwan, a country at high risk in the event of an escalation in Sino-American tensions, has understood this well. Taiwanese legislator Ko Ju-Chun recently called for adding bitcoin to the country’s foreign exchange reserves.

His main argument was that “bitcoin cannot be subjected to a [Chinese] blockade/embargo”. This is the island’