Wu Jihan's first live broadcast: In a world of volatile fluctuations, Bitcoin is hardly a safe haven

On the evening of March 25, Zhikuang University organized the "First Interview with Miners Around the World", which was broadcast live simultaneously on Chain Node and Yizhibo. Bitmain Director and CEO Jihan Wu was invited to participate. This was Wu Jihan's first appearance in a long time.

During the live broadcast, Wu Jihan talked about his views on the price trend of the currency after the halving, his views on why Bitcoin failed to play a safe-haven role in this global asset crash, and the timing of mining machine updates. In addition, he also talked about his expectations for the future development of BCH and his views on the future of Ethereum.

Interestingly, this may be the first time he has publicly stated that his views on Bitcoin are relatively less enthusiastic.

The following text is from the live broadcast and compiled by Babbitt.

Bitcoin will eventually reach a peak, and the growth rate will become more and more flat

Litecoin was the first to complete the halving. Its trend was first rising and then falling, but it did not break through the previous high. This is a bad sign. In addition, as the market value of Bitcoin continues to expand, its volatility gradually decreases. The advantage is that the currency value is stable, but the rise will not be as fast as before.

No matter how high Bitcoin goes, it will eventually reach a peak one day in the future. Before reaching the peak, its price curve will become flatter and flatter. Of course, if you look at it a few years later, you will find that the price of the currency is rising slowly, but there are many twists and turns.

Based on this, I think that this bull market may not coincide so well with the halving, and there may be a delay in time.

Optimistic about 2020, global central bank liquidity will boost the value of financial assets

Standing at the end of 2019, when we predict the trends in 2020, our biggest feeling is uncertainty.

At that time, we saw that the factors driving Bitcoin prices were moving towards extremes, so the judgment at the time was that it could rise to the sky or fall to hell.

Bitmain has been preparing for two possibilities.

In 2020, we saw several circuit breakers in the U.S. stock market, which also shows that the driving factors in the economy are indeed very extreme. For example, the Federal Reserve, under tremendous pressure, has pushed interest rates towards negative interest rates. The U.S. dollar is the foundation of the world's currency, and it is moving towards negative interest rates. This trend is unprecedented.

Although this extremely loose monetary policy did not exist at the end of 2019, the political pressure could already be seen.

On the other hand, after years of loose monetary policy, global debt leverage is extremely high and at its limit. In this situation, a trade war has also arisen, which will hinder production collaboration and efficiency improvements. All of this means that a crisis is brewing.

When the coronavirus appeared at the beginning of 2020, I was personally more optimistic about the whole year of 2020.

The virus can be eradicated. We have seen that it usually takes about two months from the time of attention to the eradication of the virus. After that, economic activities return to normal.

However, during this period, major central banks released money, and fiscal policy became part of the monetary policy expansion. As a result, it was difficult to recover the money that was released. Then, the price performance of financial assets would be better.

Bitcoin enters a slow bull and long bull phase, and the new generation of mining machines can survive for 3-4 years

The development of Bitmain has had its ups and downs. When we did well, we were customer-centric; when we did poorly, we were self-centric, arrogant, and conceited. When we eliminated these human factors from the company, our products took the lead again.

Generally, a generation of mining machines can survive in succession. Today, the technological progress of mining machines and the evolution of Moore's Law have actually slowed down.

I think it will take about 18 months for the next generation of mining machines to appear. If two generations are iterated continuously, the S19 PRO (Bitmain’s latest mining machine) can mine for 36 months, which is about 3 years.

In addition, how long a mining machine can survive after it is released is usually related to the time point when it appears in the cycle of currency price fluctuations. Mining machines released at the beginning of the bull market can survive for a long time, while those released at the peak of the bull market have a shorter lifespan.

From this perspective, although the release time of S19 PRO is not the starting point, but considering that this will be a slow and long bull market for Bitcoin, I think it can be mined for about 3-4 years.

BCH has a good prospect, so you can put your unrealistic ambitions aside for now.

I think the next step for the BCH community is to do the things in front of them and put the functions of the technical roadmap into practice. In addition, the technical architecture should be kept simple and the community should maintain unity.

At present, the necessary ecological elements are gathered within the ecosystem, stability is the most important, and the prospects are very good.

In addition, BCH is to build the basic modules of electronic cash, and unrealistic things can be put aside for the time being.

In a volatile world, Bitcoin is hardly a safe haven

I am relatively less enthusiastic about Bitcoin.

I think gold and Bitcoin do have a role in hedging risks, but if the world really goes to extremes, gold may be a very useful currency. Bitcoin is easy to transfer, and when the payment network built by sovereign states collapses, Bitcoin also has a role in hedging risks.

However, recently Bitcoin and gold have been moving in sync with the stock market. How do you explain this? The world is experiencing a financial crisis, which does not mean that the world has collapsed. Financial crises are a normal phenomenon in economic activities.

At this time, the so-called safe-haven assets are only a branch of financial assets. To truly play a safe-haven role, they must be in extreme situations such as war, famine, and civilization change.

But in that case, what can you exchange your gold and bitcoin for? It may not be what you can exchange for in times of peace and prosperity.

As long as the economy is bad, the value of all assets will collapse, it just depends on who has a bottom line. In a world of volatile fluctuations, I think it is difficult to say that Bitcoin is a safe haven.

However, I think the relationship between Bitcoin and the financial market is a bit like the waves and surfboards. Sometimes they go against each other, and sometimes they go with the flow. How well the surfboard rides is a test of your level.

Ethereum has problems, but its status is hard to shake

Ethereum is the pioneer and innovator of smart contracts, but it has problems such as performance, and its technology development has been slow. Developers focus on less important issues, such as thinking about eliminating POW every day.

Later blockchain innovators are actually making a better Ethereum. It is still difficult for these "Ethereums" to challenge Ethereum's position. Ethereum's first-mover advantage is still very strong. For example, Defi. I think Ethereum's status in the industry is difficult to shake.