Strike Expands To The Philippines

Strike, the bitcoin-based payment network and financial app, is expanding to the Philippines.
The move brings one of bitcoin’s best use cases, remittances, to one of the world’s largest remittance markets.
Ripe For Disruption
Long considered one of the best potential use cases for bitcoin, remittances are how individuals can send money between different currencies to each other.
This is absolutely crucial for many people in developing countries, and as such, remittances have evolved into a massive $700 billion market.
Because of their importance, you would think the powers to be would make sending them relatively easy and cheap. Wrong. Sending a remittance is ridiculously expensive, with the average global fees coming out to 6.3% of the amount sent.
Imagine if each of your Venmo transactions took a 6% cut. Now imagine if those Venmo transactions determined if your family gets to eat that day. That’s what many people who send remittances are dealing with.
Bitcoin, being the easy and cheap payment processor it is, is an attractive alternative to the traditional broken remittance system. It costs less than a penny to send money with Strike – a heck of a lot better than 6%.
And that’s what Strike is bringing to the $12 billion Philippine remittance market.
Strike Takeover
The expansion into the Philippines is the first move in what is shaping up to be a busy year for Strike.
CEO Jack Mallers says that expansions into Latin America and as many as 20 African countries are coming soon because of “an extreme amount of demand”.
These expansions, combined with its partnerships with payment providers Fiserv and Visa, tied to an $80 million Series B last year, make Strike a premier bitcoin player to watch in 2023.
We’ve highlighted Jack and Strike many times over the years in this newsletter as using bitcoin to tackle an important issue. While we all hope for the prices of cryptoassets to rise and the bear market to end, it’s important to highlight projects that are transforming money and creating more economic freedom in the world.

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New Bitcoin NFTs Cause Rift in Community

Bitcoin is now home to NFTs, and not everybody is happy about it.
The NFTs, known as “Ordinals”, were officially launched by software engineer Casey Rodarmor on January 21st.
The Ordinals enable the existence of “digital artifacts” (a fancy word for NFTs) on the bitcoin blockchain. These digital artifacts can be JPEG images, PDFs, videos, or audio recordings.
It’s a pretty cool and definitely a novel use of bitcoin, but it is also extremely controversial.
The Ordinal Bull Case
On the one hand, we have those who like Ordinals. These people believe that Ordinals are good for bitcoin because it gives bitcoin another use-case and drives more demand for block space, earning the protocol more fee revenue.
It’s a sound argument.
Bitcoin, as it stands, doesn’t exactly rake in fees. This is a problem because fees are how miners will be paid until all 21 million bitcoins are mined. If these fees can’t cover the lost revenue from the bitcoin emissions, then it’s likely that miners will stop securing the network, which would leave bitcoin vulnerable to an attack.
So, if we want to keep bitcoin safe, it needs to start earning some damn fees. Projects like Ordinals just could be the key.
The Ordinal Bear Case
Needless to say, the fee argument isn’t compelling to those who aren’t fans of Ordinals.
These people argue that NFTs are a waste of bitcoin blockspace. The theory is that because fees are more expensive when the blockspace is congested, these NFTs are pricing out people from using bitcoin for what it was meant to do, sending payments.
This debate over how to use the bitcoin blockspace is nothing new. The most famous example is the 2015-2017 blocksize wars, in which the bitcoin community was split over how large bitcoin blocks should be. Ultimately, the people who favored keeping the blocks small won out, leading the large blockers to create Bitcoin Cash.
Overall, it was a pretty similar situation to the current debate over Ordinals and block space.
So, Who Is Right?
Honestly, it’s hard to say.
To date, bitcoin hasn’t found enough success as a currency to earn the fees necessary to pay its security budget. Will this happen in the future? Maybe, but right now, this is an existential risk to bitcoin.
However, one of bitcoin’s great strengths is the community’s devotion to its original mission of providing the world with permissionless and censorship-resistant money.
On the one hand, this is one of the most exciting and controversial things to happen to bitcoin in quite some time. On the other, it may be an illegitimate use of a technology that should be used to democratize money.
We’re excited to see what the bitcoin community ultimately decides.

White House Releases Crypto Regulatory Roadmap

The White House is itching for some crypto regulation.
In a new statement, the Biden administration unveiled its thoughts on the industry, its roadmap for regulation, and what it thinks Congress should be doing regarding crypto.
Thoughts On The Industry
The White House harbors mixed feelings about crypto.
On the one hand, the White House recognizes that crypto has the potential “to make payments faster, cheaper, and safer”. We do too.
But, the White House also included a paragraph about the Luna collapse, centralized exchange blowups, and North Korean hackers. Fair enough.
In many ways, the White House’s view on crypto is the same as ours… Crypto is a revolutionary technology that, right now, can be risky, often has poor security, and contains a range of bad actors.
Whether crypto grows out of this phase and into its full potential depends largely on regulation, which is what the White House discussed next.
Regulatory Framework
The White House is taking a two-pronged approach to regulation.
The first prong is their Comprehensive Framework for Responsible Development of Digital Assets released in September. The entire framework is worth a read, but the TLDR is that the White House plans to use the full power of the government to cut down on what it views as crypto’s risks: hacks, climate emissions, illicit finance, and fraud.
The second prong is increased government enforcement. Basically, the White House wants government agencies to get more active in ensuring that crypto is safe. We’re looking at you, Gensler.
Overall, nothing here that we didn’t already know.
The Role Of Congress
The most interesting part of the report is the White House’s views on Congress. They aren’t impressed with how Congress has handled crypto, and want them to step it up ASAP.
The White House then gives several examples of how Congress can stop dropping the ball:

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