• This article reviews the recent bank crash and expands on the original mission of Bitcoin. It is highly recommended for investors who have never read the Bitcoin white paper! #BTC

01丨Thunderstorm timeline🏁

The figure below is a timeline of the initial problems encountered by the five banks some time ago. For encryption, Silvergate was the beginning, and for traditional finance, the collapse of Silicon Valley Bank (SVB) was the first domino to fall.



Many crypto industry leaders speculate that the collapse of a number of crypto-friendly banks was caused by "someone" behind the scenes. After all, the United States' crackdown on cryptocurrencies in recent years is visible.

However, the core of this article is not about this macro-level game, but from the perspective of capital risk and traditional banking, let us think about the original intention and mission of Bitcoin.

02丨At the Beginning😀

As we all know, Bitcoin was first born in the financial crisis of 2008, when hyperinflation caused by banks led to wailing in the real economy.

In a similar context, SVB’s collapse this time did not result in the same scene as back then. Relatively speaking, this time is similar to 2008 but not exactly the same: SVB has a liquidity crisis, but not too many bad debts.

In recent years, whenever the traditional financial sector collapses, BTC will become a hot search. After all, decentralized finance represented by Bitcoin is the natural opposite of centralized finance. Funds will flow to where it is safe. In the environment of potential financial crisis, Bitcoin has become a short-distance harbor for risk aversion.

The reason why Bitcoin is called "digital gold" today is because it is the first new financial consensus on the planet under global collaboration. Without the leadership of a main body, it has become the thing with the most terrifying increase in the world in more than ten years and has derived a new financial system from it.

03丨Decentralized Bank 🏧

This concept is not my original idea, but borrowed from the book "Self-cultivation of Leeks". This is also a saying that was circulated during the Bitcoin trail in the ancient times. It is very appropriate in the context of the bank's collapse. I add some of my personal understanding to expand the end of this article.

Simply put: Bitcoin is the first globally agreed upon entity-less world bank.

You can imagine this scenario: in any corner of the world, you can exchange Bitcoin for legal currency or legal currency for Bitcoin, and you don’t need to carry any physical assets. You only need to remember your private key and you can take them out on the other side of the earth (assuming someone has a transaction with you)​

Global circulation without a subject. This is a major feature of Bitcoin, which is more convenient than relying on bank branches to withdraw money; of course, there is a prerequisite: consensus.

The word consensus is actually an important factor that supports the operation of the financial system. Whenever people talk about cryptocurrencies, they always use stocks as a comparison. In fact, as a former securities practitioner, even in the stock market, there are many financial assets that do not match the actual value (even false bubbles).

The fact that Bitcoin has been able to gain widespread global consensus over the years is closely related to its decentralized nature and inherent technical trust. Bitcoin is like a virtual pool of funds where you can put your assets and take them out when the time is right.

  • The actual price fluctuations during the two transactions are simply the difference in the number of people queuing at the Bitcoin bank during that period. When there are enough people queuing, you consider withdrawing the equivalent assets you previously deposited, and you will find that you still have some Bitcoins left.

  • Therefore, smart investors are good at withdrawing assets when the queue is long enough and depositing the money back when the queue is not crowded.

If more and more people accept this view, it will undoubtedly be a boost to the global consensus of the crypto industry. This banking incident not only makes the security of personal assets pay attention, but also makes the safe-haven properties of Bitcoin pay attention.

This new financial model, in the context of centralized institutions openly violating their credit, will not necessarily become a replacement, but it will also be a mainstream trend with certainty.

The future will be a monetary structure where centralized and decentralized monetary systems run in parallel, and where reality and virtuality are combined.