Research Summary

The report features an interview with Hong Shuning, a former employee of the People’s Bank of China and a Bitcoin enthusiast. He discusses his early involvement with Bitcoin, his predictions for its future, and his views on Ethereum and the RGB protocol. He also addresses concerns about Bitcoin’s centralization and the potential for it to be controlled by Wall Street.

Key Takeaways

Bitcoin’s Potential to Counter the US Dollar

  • Bitcoin as a Counter to US Dollar Hegemony: Hong Shuning first encountered Bitcoin in 2011 and saw its potential as a new currency to counter the hegemony of the US dollar. He wrote a paper advocating for the state’s participation in Bitcoin mining, the establishment of Bitcoin banks, and the use of Bitcoin as a reserve to issue RMB.

Bitcoin’s Future Value

  • Bitcoin’s Long-Term Rise: Hong believes that Bitcoin’s long-term rise is an inevitable trend. He predicts that Bitcoin could reach $100,000 in the next few years, and if it replaces gold, its value should be around $400,000. He also believes that Bitcoin has the potential to replace the US dollar and become the foundation currency of the world economy.

Ethereum’s Future

  • Rejection of Ethereum: Hong is not optimistic about Ethereum’s solution and believes that Bitcoin can achieve all of Ethereum’s functions through innovations like Taproot. He predicts that Ethereum will become unnecessary and that ETH will eventually go to zero.

RGB Protocol

  • RGB Protocol’s Potential: Hong supports the RGB protocol, a solution to achieve Turing-complete smart contracts on the Bitcoin chain. He believes that RGB can realize DeFi, GameFi, NFT, and various applications, bringing a large number of transactions and providing miners with enough fee income to ensure Bitcoin’s security.

Bitcoin’s Centralization

  • Centralization Risk: Hong does not see the risk of Bitcoin’s centralization, including being controlled by Wall Street, as severe. He believes that the concentration of social wealth is an inevitable trend, whether it is gold, the US dollar, or Bitcoin.

Actionable Insights

  • Understanding Bitcoin’s Potential: Investors and financial institutions should consider the potential of Bitcoin to counter the US dollar and its long-term rise as predicted by Hong Shuning.
  • Assessing Ethereum’s Future: Hong’s prediction of Ethereum becoming unnecessary and ETH going to zero should be taken into account when considering investments in Ethereum.
  • Exploring RGB Protocol: The RGB protocol’s potential to achieve Turing-complete smart contracts on the Bitcoin chain and realize various applications could be a significant development in the cryptocurrency space.
  • Considering Bitcoin’s Centralization: The risk of Bitcoin’s centralization and potential control by Wall Street should be considered when making investment decisions in Bitcoin.

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