For many in the crypto and traditional investing community, Bitcoin (BTC-USD) is digital gold—a store of value. But developers argue that adding programmability could unlock a boatload of new functionalities. Unlike Ethereum (ETH-USD), which supports smart contracts and decentralized apps, Bitcoin doesn’t have these features.
Over the years, attempts have been made to make Bitcoin more versatile with “Layer 2” networks like Lightning, aimed at scaling Bitcoin for payments. These solutions, however, have had reliability issues, and bridges used for transferring tokens between networks have been prone to hacks. That might be a bit of an understatement. Bridges have been responsible for some of history’s biggest hacks and financial losses.
Pushing the Boundaries
Despite the hiccups, developers are pushing forward with enhancing Bitcoin’s programmability. Projects like Bitcoin Ordinals, which allow creating non-fungible tokens (NFTs) by embedding data onto satoshis (the smallest unit of Bitcoin), are a great example.
An anonymous developer, Domo, proposed BRC-20 tokens, sparking a flurry of innovation. Proposals like OP_CAT, a potential software upgrade to Bitcoin, are being considered to simplify programmability.
Some Bitcoin developers remain skeptical, betting on Layer 2 solutions. Meanwhile, others believe the influx of decentralized finance (DeFi) apps on Bitcoin could be a game-changer. The total value locked (TVL) in Bitcoin’s DeFi market is about $1.1 billion, dwarfed by Ethereum’s $52.7 billion. Proponents of Bitcoin’s programmability envision it rivaling or even surpassing Ethereum’s DeFi ecosystem.
Bullish Sentiment
From a price action perspective, analysts are turning bullish on Bitcoin after a consolidation period. Significant buyers have been snapping up 100,000 to 120,000 BTC calls for December 2024, indicating confidence in Bitcoin’s rise.
Quant analyst PlanB, famous for his Stock-To-Flow ratio, sees a repeat of 2017’s price action. PlanB believes we might be witnessing the last chance to buy Bitcoin below $70,000.
With miner revenue historically recovering two to five months after a halving, PlanB predicts Bitcoin’s price will go vertical later in 2024 as industry revenue rebounds.
Is Bitcoin a Buy?
According to TipRanks’ Summary of Technical Indicators, Bitcoin is a Buy.
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