How many hours do you spend browsing information? Where do you get your information from? Can you recommend some valuable information channels? How do you determine the sentiment of the community besides contacting the project party?
Dr. Jingo: It takes about 3-5 hours of fragmented time to browse information. Most of the information comes from Twitter, WeChat groups, and Telegram. Some good friends also introduce me to some excellent projects, and then we schedule meetings to review their documents. I also spend some time writing tweets, so my day is usually quite full.
I used to want someone to develop a fully automated information push system, directly sending various aggregated information to your mobile phone terminal, similar to the push information on the old BlackBerry phones. But I actually enjoy the process of filtering information myself. For example, the Ordinals protocol was discovered by me through browsing news reports online. None of the aggregation platforms mentioned it at that time. So in terms of information channels, I think it’s good to browse randomly online and discover fresh things. On the other hand, I have friends who regularly push information, and I also take the time to read project information left by netizens under Tweets.
BlockBeats: We can see that there are more and more Bitcoin Layer 2 projects recently. How do you view these Layer 2 projects in the market? Besides, which projects or assets do you currently favor?
Dr. Jingo: I currently prefer teams and products that build on Layer 1, so some people also call me a BTC L1 purist. In the early days, the debate about BRC20 often focused on the technical aspect and whether it was necessary. Many developers from the West had a lot of doubts about BRC20 and regarded it as outdated and not highly decentralized. But as this market emerged, everyone also accepted this fact. I see more and more Western developers gradually entering the BRC20 ecosystem.
One phenomenon I currently observe is that the Chinese community mostly discusses BTC Layer 2, while foreigners are starting to delve into Layer 1 and launch many projects, such as lending, AMM, and DeFi. From the narrative and the overall development of the industry, I think we are now entering the BTC Layer 2 era on a large scale, which is somewhat fast. I personally believe that BTC Layer 2 should be a medium to long-term plan, at least a two to three-year plan.
However, currently, whether it’s Layer 1 or Layer 2, the artificial impact of the halving cycle on BTC and its assets’ supply and demand will further drive up the price of BTC. From the perspective of reducing BTC circulation and supply through collateralization, I think it plays a similar role as the narrative of the halving. Interestingly, some project parties exchange their precious Bitcoin for various projects, and users exchange their Bitcoin for altcoins in order to gain high returns. Project parties have profited from this exchange process, and this phenomenon is also worth serious consideration for retail investors.
(BlockBeats: BTC Layer 2 Overview)
Currently, I am more exposed to foreign projects, and some projects I think are good include ordiswap, ordibank, and Liquidium. Liquidium received early investment from Bitcoin Magazine and Bitcoin Frontier Fund. It is a project that does Bitcoin collateralization. They provide liquidity or exit channels to some extent. Recently, some people have been researching how to issue stablecoins on Bitcoin, such as MakerDAO. I think these things are quite interesting because stablecoins are currently indispensable in the upcoming BTC DeFi Summer.
BlockBeats: What signals or standards do you think we can discuss Bitcoin Layer 2 now?
Dr. Jingo: My logic is clear. First, let me explain why I advocate for Ordinals. I think there are three important narratives, as I mentioned in my article. Firstly, compared to Ethereum NFTs, the data on the Bitcoin chain is permanently immutable, which means personal digital sovereignty is guaranteed. Bitcoin has PSBT, so even if all the CEXs in the world refuse to let you trade your assets, you can still complete the transaction through PSBT, which is something that any other chain cannot achieve. Secondly, after the halving, Ordinals brings additional income to miners, which can help maintain the security budget of Bitcoin or provide a viable solution. In the past year, we have seen that the transaction fees brought by BRC20 or collateralization sometimes account for about 20% to 30% of the entire network. This provides a certain guarantee for the security budget of Bitcoin after the halving. The third is the transformation of digital gold into the digital gold jewelry market, which will make Bitcoin more interesting.
Currently, many Layer 2 projects do not relate to these three narratives. So, in my opinion, the ideal state of L2 is that Bitcoin’s ecosystem has developed to a certain extent, such as miners’ income accounting for 20% and transaction fees reduced to between 3% and 5%. At the same time, people truly feel that this security tax is high, and more people may be willing to switch to Layer 2, sacrificing some security to save costs. The core issue of Layer 2 is sacrificing security, and all Layer 2 projects more or less reduce the native security of Bitcoin. My deduction is that Bitcoin Layer 1 will become busy to a certain extent, miners’ income will reach a certain balance, and the number of Bitcoin users will reach a certain level before L2 has a chance to take off. It’s like a hotel becoming too crowded, and some people will choose to stay in the nearby inn. But what I said is just one deduction. The final evolution path is determined by the market and the choices of many users.
BlockBeats: The OP_CAT soft fork promoted by the Taproot Wizards project has sparked a lot of discussion in the community, especially in the English community. Of course, there is still a lot of divergence among people. Some people think that although this is not a short-term thing, it is still something worth looking forward to. If it is really completed, it will have a significant impact on Bitcoin’s scalability, Bitcoin smart contracts, and Bitcoin ZK rollup Layer 2. However, some people think that this is a very dangerous soft fork. How do you view the OP_CAT soft fork?
Dr. Jingo: The Taproot Wizards’ udi sometimes messages me, so we sometimes chat, including almost participating in their financing. Speaking of the OP_CAT soft fork, I am definitely supportive. I think there are many paths for the development of the Bitcoin ecosystem. Promoting the OPCAT upgrade is actually a very smart move. It will help developers develop on BTC more easily, improve the extensibility of BTC, and will not harm the security of BTC.
Therefore, I think that as the most secure blockchain, Bitcoin should support some innovations that do not affect security and decentralization. We should not stick to dogmatism. So I may belong to the least popular reformist. Most community members either strongly support reform or are very conservative. I am somewhere in the middle, but I think this may be the most realistic path for innovation on Bitcoin.
So I am quite excited about the BIP proposed by udi and the Taproot Wizards for OP_CAT. I am indeed supporting them in doing this, which may have a bigger impact than any project. The difficulty is also very high. In short, for me, if I can contribute to Bitcoin or make some changes, I think it is something to be proud of!
BlockBeats: Overseas media have given three criteria for BTC Layer 2. Can they be achieved technically? Even if they are achieved, will the economic effects and efficiency be ideal?
Dr. Jingo: I have seen the three editorial principles about L2 proposed by Bitcoin Magazine, and Pantera Capital also mentioned similar ones in their research report. Personally, I think the extensive discussion about L2 is beneficial. At least users are starting to think about what L2 is, what its purpose is, and what problems it can solve. This is progress. Of course, I also think that these three criteria are theoretical and idealized. We must remember that BTC is the most permissionless, and the final definition will be formed by consensus in the market and among users. It seems to be a “convention” that everyone agrees on. This is my view on L2 standards.
BlockBeats: You have been studying NFTs more in the Bitcoin ecosystem before, and you have also been involved in the Chinese community of Bored Ape Yacht Club (BAYC). So, I’m curious about your current view on BAYC. Recently, the price of BAYC has been surpassed by the Penguins. There is still a lot of discussion in the NFT community about this. Will BAYC still be the “dragon” in the future?
Dr. Jingo: BAYC holders have already made a lot of money, especially early buyers. At the beginning, no one really knew what it was and that it could be hyped to 150 ETH. Many people even thought the artwork was ugly. But what’s interesting is that when the price of BAYC rose to 30 ETH, or even as high as over 100 ETH, everyone thought it was beautiful and took pride in owning such an avatar. So you could say that I am both an observer and a participant, and I can feel the change in emotions. People’s aesthetics may change with the fluctuation of prices.
Finally, I have observed that NFTs are also a social experiment. Social experiments always have moments of failure or when people lose interest in something. After two to three years, the market is experiencing a trough. So personally, I don’t have much disappointment towards BAYC, but I do feel a bit fatigued. I have held onto my Yuga Labs assets until now. Overall, I think NFTs are driven more by emotions, so the price fluctuations actually reflect short- to medium-term behaviors. But if you truly believe in NFTs, I think these assets should be held for the medium to long term. I think compared to Ponzi schemes and air assets, Yuga’s assets are worth holding onto.
(BlockBeats: BTC Layer 2 Overview)BlockBeats: Bitcoin NFT has always been in a competitive state, and people have different opinions on the leader of Bitcoin NFT. Dr. Jin Gou, what are your thoughts on the current form of Bitcoin NFT? What conditions do you think the ideal Bitcoin blue-chip NFT should meet?
Dr. Jin Gou: This is an interesting topic. In the early days, BAYC and PUNKS competed for the leader position based on the floor price. I believe that the leader is a concept that is relatively unique to a specific period of time. I remember that there were some evaluation systems for NFTs, including various indicators such as the capabilities of the project party, the artistic attributes of the NFT, and the community. These indicators generally apply to BTC, but I think BTC’s NFT culture has a slight difference from ETH, especially in terms of narrative in time. We often hear people say “first is first”, and this point has a strong consensus in the BTC community.
Emotions and narratives can change, but time is an objective existence that we cannot change. BTC is also a chain of time. For example, in the Ordinals protocol, based on the standard of time, there may be two types of NFTs: one is the early ones with low serial numbers like Sub100 or Sub1000, which represent the OG status in the inscription. They are the ultimate collection goals for collectors. However, the disadvantage is that early inscriptions are often rare in series and have a small community, which may result in insufficient liquidity in the market. But this type of inscription will have the opportunity to be displayed to the public through auctions. Their scarcity is directly locked in by time.
At the time of posting, the market value ranking of Bitcoin NFTs.
Regarding the 10K projects in the Ordinals standard, NodeMonkes has recently performed very strongly. It is the earliest 10K project in a series, and the developers are also very talented with a good community. Therefore, the price has been steadily rising, and the market value has been gradually increasing among all NFT series, demonstrating its dominance. I have also spent a lot of time on this project and provided many suggestions on the issuance method with the project party, so I also have an honorary NodeMonkes avatar. There are many promising projects on Ordinals, such as Bitcoin Frog, OMB Maxi, Bitcoin Punks, Ninjia, etc. Each of them has its own story and community, especially Bitcoin Frog, which has been the leader for a long time, leading in both trading volume and floor price. I believe that these projects also have the opportunity to become leaders in the future.
BlockBeats: What interesting things do you think will happen at the Bitcoin conference and Ordinals HK event in May this year? Do you have any new expectations compared to 2023?
Dr. Jin Gou: There should be some fundamental differences. In 2023, a few people in the community pooled their resources and organized many activities out of their love for Bitcoin. At that time, in April, they even sponsored many hats and airdropped Bitcoin Frog. The Bitcoin community in Hong Kong is still the same, with a unique style, rarely socializing or hosting parties. Everyone is still interested in watching the excitement.
But with the rising price trend of Bitcoin, the offline enthusiasm will also improve, and everyone’s emotions will be positive. The Bitcoin conference in Hong Kong in May this year is a historic moment to bring Bitcoin to Hong Kong. So the Ordinals Asia event also invited many people, such as the founder of Wizard Udi and the founder of BRC20 Domo, who we mentioned earlier, have confirmed their attendance. Another thing I noticed is that this gathering should be very global, which is a great event for mainland China, Hong Kong, and many friends abroad.
Personally, I am currently working with another doctor from Silicon Valley and a friend from Dubai to establish a Bitcoin-related laboratory. We initially wanted to establish an Ordinals Foundation during the early stages of the protocol. However, we found that the term “Foundation” received criticism from many people. Perhaps people do not like the Ethereum Foundation. So we rebranded it as Foundinals lab, which combines Foundation and Ordinals, as well as Founder and Ordinals. We hope to use our knowledge and understanding to help more developers enter the BTC ecosystem and more users join the BTC ecosystem. We still consider the revival and greatness of the BTC ecosystem as our mission, spreading knowledge and educating users.
As for the theme of 2024, we want to promote more communication between the Eastern and Western Bitcoin communities, reduce cultural and other barriers, and truly make Bitcoin a global movement. I personally don’t think the dispute over Bitcoin’s discourse power is meaningful because Bitcoin itself is a global movement. We should all embrace Bitcoin as our common goal and be on the same channel. Obviously, foreigners also want to understand the Chinese market. BRC20 has already demonstrated this. The next step in the development and cultivation of the Bitcoin ecosystem should focus on connecting the markets and users of both the East and the West, bringing together a group of people, events, and resources that are genuinely innovative.
BlockBeats: I remember when I was in Taiwan at the end of last year, you taught Baobao Er how to enter the Bitcoin ecosystem, and he drew an asset map and posted it on Twitter, which sparked a lot of discussion. I noticed that there were many voices in the community that didn’t support your contact with him and his entry into the Bitcoin ecosystem, thinking that a “big split” was coming. How do you view these opinions?
Dr. Jin Gou: I can understand their feelings. As the saying goes in the crypto community, “Everyone has their own position.” In my opinion, everyone is the same when it comes to knowledge. Secondly, Bitcoin itself is permissionless, and its spirit is that everyone can participate. No one can say that only retail investors can participate, and whales or institutions cannot. No one can stop this.
And even if it’s not me, no one can stop the expansion of Ordinals. Anyone can learn or find others to teach. However, for me personally, I feel honored to have such an opportunity. On the one hand, it allows everyone to have a more accurate understanding of Ordinals and the Bitcoin ecosystem, and on the other hand, I have established contacts with these whales and institutions. Maybe many people are not aware that shortly after that, Binance launched $sats, and I think this development is also inseparable from the promotion of these whales and institutions. So I think it is beneficial for the protocol’s expansion to involve influential people with resources. And because of the fairness of BRC, it allows whales and institutions to sell to retail investors, highlighting the characteristics of the BTC ecosystem.
So I think the emotions and behaviors of most community members are not consistent. I don’t know if everyone still remembers the situation before the conference in Hong Kong. Many people offered a reward of 200,000 Hong Kong dollars online to “slap Sun Ge” and criticize him. But when it came to the conference, everyone was asking Sun Ge for a photo. This is understandable. In fact, everyone cannot maintain complete consistency. People always have their own temporary emotional venting, especially in the virtual world. At first, I would go and see what everyone was saying, but now I basically treat it as noise and don’t care much. If I believe it is right, I will do my best to do it and practice the principle of permissionless.
BlockBeats: In this bull market cycle, what do you think will be the highest price of Bitcoin, and how do you judge it?
Dr. Jin Gou: I often discuss this question with my friends. My previous prediction was that it would be good if it surpasses the previous high in 2024 and reaches 70,000 to 80,000.
Recently, I saw a convincing calculation method in the Big Idea 2024 report released by ARK Invest, a fund managed by Wood. It calculates the relationship between investable assets and the price of Bitcoin, how much real-world money flows into Bitcoin and can drive its price, and how much Bitcoin should be compared to the market value of gold. Then it calculates how much money is available for investment in the real world, such as ETFs, to estimate how high Bitcoin can rise. It sounds more reliable. Their conclusion is that when 25% of investable funds flow into Bitcoin, it can reach $120,000 to $150,000.
BlockBeats: From the beginning of the Bitcoin ecosystem to the current prosperity, many users and community members have raised a major question, which is that they have limited knowledge of many basic aspects of Bitcoin, resulting in a generation gap when entering the ecosystem and participating in various projects. So could you please recommend some ways (free) to acquire basic knowledge of Bitcoin, such as how to read the mempool and UTXO for beginners?
Dr. Jin Gou: Yes, this area does need strengthening, especially in terms of video tutorials and popularization. There have been many discussions in the Bitcoin community on this topic. I used to insist on it for a while and collaborated with some educational communities, but later I couldn’t find enough time to do videos. So in the future, I may cooperate with some communities and educational projects to record basic tutorial videos. There are also blockchain and Bitcoin-related videos on YouTube that you can search and watch.
OMB community has done a great job in this area. They have launched a bounty program to encourage community members to create tutorial videos to help new users understand BTC. Recently, Taproot Wizard and Jan also launched TechnicallyBTC, explaining many basic concepts, so I recommend everyone to check it out. I think it might be a good idea to make Chinese subtitles for their videos. Thank you for reminding me, I should continue to try in this area. I have a Twitter space with 0xsea, ALEX, and Rachel from the Three Little Pigs of Bitcoin. The original purpose was to promote and introduce the basic knowledge of BTC. We also invited active developers in the industry. In the future, it can be turned into a podcast to reach more people.
Related Reports
After the Bitcoin NFT craze, what narrative does the BTC ecosystem still need?
Did Satoshi Nakamoto leave encrypted messages in Bitcoin NFT “inscriptions”? 60,000 pounds for 332 inscriptions, the community deciphers it as government surveillance data.
Reviewing the top ten figures in the crypto market, will they call the shots in 2024?