Co-founder of BitMEX Arthur Hayesthinks that excessive hodling (holding crypto) will cause Bitcoin to be completely destroyed.
Publishing a new blog post, Hayes stated that the price increases that Bitcoin has experienced in the last decade have given birth to a culture of hodling, which is the act of holding for long-term investment rather than buying and selling coins.
According to the co-founder of BitMEX, miners Bitcoin (BTC) Unlike gold, it is very important that Bitcoin is used to gain value rather than being stored, due to the energy expenditure to maintain its network.
“To cover their costs, miners must be able to receive and be paid with a socially valuable token. Therefore, Bitcoin must be on the move, and the movement between the parties is the opposite of the HODL culture. When the HODL culture reaches its peak, it causes Bitcoin to be completely destroyed.
When all Bitcoins are mined and miners are no longer able to generate sufficient revenue from network rewards in the form of newly minted Bitcoins, they are instead forced to rely on transaction fees. Since we’re all sitting tight to our USB sticks, if no Bitcoin changes hands, there will be no hashing power to support the network. If there is no network, there is no value.”
To avoid this scenario, Hayes thinks policymakers should develop a regulatory environment that “promotes the mining-to-table Bitcoin economy.”
In March, Hayes, fellow co-founders Benjamin Delo and Samuel Reed were found guilty of breaking a law that required financial institutions to help the government detect and counter money laundering schemes.
The US Department of Justice (DOJ) claimed that while the trio claimed BitMEX did not serve individuals in the US, it deliberately failed to maintain anti-money laundering protocols and profited from US-based clients’ transactions.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.