Bitcoin's volatility set to decline with evolving payment systems, says Blockstream CEO
Bitcoin's volatility set to decline with evolving payment systems, says Blockstream CEO
Bitcoin’s volatility—a defining characteristic that has both drawn and deterred investors—is not here to stay, according to Adam Back, co-founder and CEO of blockchain infrastructure firm Blockstream. In recent statements, the British cryptographer argued that Bitcoin’s price fluctuations are a temporary phenomenon tied to its adoption pace and evolving role in the financial ecosystem. As advancements in payment technology continue, he suggested, Bitcoin’s volatility will likely decrease, and it will become a more accessible asset.
Back, who is also known for his contributions to cryptographic technology, challenged the view that Bitcoin’s primary value lies solely in its function as "digital gold." While often seen as a hedge against inflation and a store of value, Bitcoin has potential beyond capital appreciation, he said. "People remember the inflation after COVID, and our currencies appear unstable. However, Bitcoin is also volatile, but this is temporary because the network technology was adopted too quickly,” he explained. As the network matures and newer payment solutions arise, Back believes Bitcoin could become an effective medium of exchange.
Advancing Bitcoin’s Usability Through Cross Wallets and Liquid Network
For Back, the key to broadening Bitcoin’s usability lies in the creation of trading solutions that address market demand while enhancing transparency. Specifically, he highlighted the role of “cross wallets,” which would allow users to exchange Bitcoin for other digital assets without relying on centralized platforms. Decentralized and cross-asset solutions, he argued, would provide a greater level of trust in the market by reducing the reliance on traditional exchanges. Though promising, Back noted that these technologies are still in early development stages and not yet fully operational.
To further accelerate Bitcoin’s adoption, Blockstream is working on several initiatives through its Liquid Network, a Bitcoin sidechain designed for quick and secure transactions. This technology is particularly targeted at commercial institutions and banks, aiming to facilitate Bitcoin’s integration into mainstream finance. Blockstream’s vision aligns with growing institutional interest in cryptocurrency, as companies increasingly explore the use of blockchain technology in financial services.
Back has also advocated for the value of Satoshi Nakamoto’s anonymity, viewing it as a distinctive asset that sets Bitcoin apart from other cryptocurrencies. The absence of a known founder, he said, underscores Bitcoin’s decentralized nature and contributes to its unique appeal.
As Bitcoin’s infrastructure and market solutions continue to evolve, industry leaders are optimistic that the digital currency will become less volatile and more usable as a payment method. Future developments in trading technology and decentralized exchanges could ultimately pave the way for a more stable cryptocurrency landscape, bringing Bitcoin closer to fulfilling its original vision.
However, Bitcoin, in turn, is showing a decline ahead of the U.S. elections.
