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@ endo
2024-12-12 21:45:08
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On Saturday, July 27, 2024, at the Bitcoin 2024 Conference in Nashville, Tennessee, Donald Trump made a bold proclamation:
> “The reason I’ve come to address the Bitcoin community today can be summed up in two very simple words — America First. If crypto is going to define the future, I want it to be mined, **minted**, and made in the USA. It’s not going to be made anywhere else.”
This statement raises critical questions: What does Trump and his administration mean by this? And what implications does it hold for Bitcoin’s global landscape?
### The Bitcoin Act of 2024 and Global Hash Wars
Less than a month from now, Donald Trump’s administration will take office, and it is highly likely that the Bitcoin Act of 2024 will come into force. This act positions the United States on a strategic path to accumulate a 1-million-Bitcoin strategic reserve. Similar developments are unfolding globally. Russia’s Bitcoin Strategic Reserve Decree is set to take effect, and China, potentially re-entering the fray, is expected to lift its ban on Bitcoin mining soon. These moves signal the advent of a ***global hash war***—a race among nations to secure dominance in Bitcoin accumulation and mining.
As of today, Thursday, December 12, 2024, approximately 94.26% of the total Bitcoin supply has already been mined. With 3.125 BTC block reward issued every 10 minutes, this equates to 450 BTC daily, 3,150 BTC weekly, and 164,250 BTC annually until the next halving. Roughly 5% (1.2 million BTC) remain to be mined before the 7th halving in 2036, at which point 99.2% of the total 21 million supply will have been mined. Beyond that, mining the remaining 0.8% will take another 104 years. Therefore practically speaking, the next decade represents a critical window for countries to establish their dominance in Bitcoin acquisition.
### The US Strategy: Policies and Challenges
The US government will likely face significant challenges competing with Chinese miners using domestically manufactured mining equipment especially combined with Russian energy resources. To counteract this, the US government might come up with some creative policies i.e. to restrict Bitcoin ETFs from selling their holdings to any entity other than the US Treasury, potentially at a discounted price.
Publicly traded mining companies could also face mandates to ensure that all Bitcoin they mine remains within the United States. Since enforcing such a policy on-chain is technically not feasible, the government may explore alternative solutions, such as leveraging layer-2 technologies like eCash. This approach could see mining companies becoming mints and custodians of the Bitcoin they mine, issuing eCash tokens for trade on open markets while retaining on-chain Bitcoin in the US.
Similarly, hosted mining services might adopt a system where users purchasing mining equipment are offered eCash instead of on-chain Bitcoin. These companies could analyze users' mining profit histories and even provide lines of credit using mining equipment and future profits as collateral.
### The Emerging Dual Market
Under these conditions, a dual market for Bitcoin could emerge. Non-KYC on-chain Bitcoin might trade at a significant premium—potentially 25% higher (or even more) —than its KYC-compliant counterparts. This discrepancy would reflect the increasing regulatory and geopolitical tensions surrounding Bitcoin ownership and distribution.
### Conclusion
The global hash war signals a pivotal moment in Bitcoin’s history. Nations like the United States, Russia, and China are vying for strategic control over a finite resource, each deploying unique policies and tactics. As these dynamics unfold, Bitcoin’s decentralized ethos will be tested against the backdrop of geopolitical ambition, potentially reshaping its role in the global economy. Central banks will eventually print their own money to buy Bitcoin. The hyperinflation might lead to socio-economic abnormalities like social unrest and potentially famine. At that point what difference will it make if Bitcoin price is 0.1m, 1m or 10m?