On the 16th anniversary of Bitcoin, we stand at a new starting point for compliance. There are no limits in the future, but it is not an unattainable utopia either.

Article author: Jeffrey, HashKey

On January 3, 2009, in the aftershocks of the global financial crisis, the Bitcoin Genesis Block was born, and the front-page headline of the Times that day, "Chancellor on brink of second bailout for banks", was permanently preserved by Satoshi Nakamoto in the first blockchain.

No one realizes that this simple timestamp has permanently changed the financial landscape of the human world. It carries the liberal ideals of cryptography geeks and has started a journey that sweeps the world. From underground Dark Web currency to Wall Street darlings, from the heresy of the digital world to the ark of humanity's fortress against inflation, every step of Bitcoin is rewriting the history of the new world of human finance. Today, 16 years later, the right-wingization of the human world is accompanied by the AI ​​technological revolution. Perhaps we are standing at the watershed of digital civilization. Although no one can foresee the true face of the future, it is certain that Bitcoin is moving towards orthodoxy and is continuing its legend in the temple of the financial world. It will continue to influence people's awakening and desire for financial freedom and digital sovereignty in a more devastating posture. The prologue of a new journey is slowly opening, and we are witnesses, participants, and builders.

1. Review: From technology experiments to mainstream assets, the great journey is by no means smooth

The birth of Bitcoin originated from a great experiment. The global financial crisis in 2008 made Satoshi Nakamoto realize the fragility of the financial world under the credit currency system, so the idea of ​​creating currency on a decentralized, unalterable blockchain was born. In its 16 years of development, it has gone from obscurity to global attention. This process is both a result of time and fate, and a witness to global financial changes.

From 2009 to 2024, every major node of Bitcoin has been accompanied by changes in society's perception of it. The narrative evolution from underground payment currency, speculative tool, to digital gold is also constantly rewriting the intrinsic value of Bitcoin.

2009

• The Genesis Block was born, and Satoshi Nakamoto received 50 Bitcoins as a reward

• The first transaction occurred between Satoshi Nakamoto and developer Hal Finney, a total of 10 bitcoins

2010

• Laszlo Hanyecz purchased two pizzas with 10,000 bitcoins, marking the first real-world commodity transaction using Bitcoin.

• Mt.Gox exchange was established, providing users with a trading venue for the first time

• Bitcoin has a price for the first time, 1,039 Bitcoins are worth $1

2011

• Bitcoin price reaches $1

• Silk Road (a Dark Web market) goes online, and Bitcoin becomes a payment tool for anonymous transactions

2012

• The first halving, the reward is reduced from 50 to 25

• Bitcoin Foundation established

2013

• Bitcoin reaches $1,000 by the end of the year

• Silk Road was shut down, and the legitimacy of Bitcoin was widely questioned

2014

• The four-year-old Mt.Gox exchange collapsed due to a security breach, losing 850,000 bitcoins

• Bitcoin regulatory framework sparks discussion in the US and Europe

2015

• Block size expansion causes division in Bitcoin community

• The potential of blockchain technology has attracted attention

2016

• Bitcoin's second halving, reward is 12.5

• Japan recognizes Bitcoin as a legal payment

• Anti-money laundering and tax regulations for Bitcoin are being introduced globally

2017

• Bitcoin Cash (BCH) was officially born from Bitcoin hard fork

• China completely bans Bitcoin exchanges; the United States begins discussing the creation of Bitcoin futures

2018

• Bitcoin price plummets to $3,000

• The ICO bubble burst

• US SEC cracks down on ICOs

2019

• Bitcoin rebounds from bear market to $10,000

• Facebook announces Libra stablecoin initiative

2020

• As the pandemic spreads and the global currency is over-issued, the price of Bitcoin has skyrocketed from $6,000 to $29,000, and the narrative of digital gold/inflation hedging tool has been discussed by more investors

• MicroStrategy begins buying Bitcoin as a US listed company

2021

• El Salvador declares Bitcoin as legal tender

• Bitcoin breaks all-time high, reaching $69,000

• Significantly increased global attention and enhanced supervision

2022

• Terra-Luna collapsed, FTX closed down, and Bitcoin fell to around $16,000

• Unprecedented regulation, legislation is beginning to move forward around the world

2023

• US institutional investors begin preparing to apply for Bitcoin spot ETF

• Bitcoin is considered a long-term store of value

2024

• Bitcoin spot ETF passed

• Bitcoin halved for the fourth time, the reward became 3.125

• Trump, the first crypto-friendly president of the United States, took office and discussed the establishment of a national Bitcoin reserve

If we review the development history of the past 16 years, we can clearly see that there have been significant changes in both the society's perception of Bitcoin assets and the evolution of its connotation. From the perspective of value connotation, Bitcoin was not given the characteristics of digital gold at the beginning. However, with the arrival of the financial crisis and the epidemic, due to its decentralized and constant total amount, it has been given the characteristics of anti-inflation/digital gold/value storage tool. This is both accidental and historically inevitable. However, this development process did not happen all at once. Whether it was the closure of the Silk Road, the Mentougou incident, or the collapse of FTX, they all formed a major phased blow to the development of Bitcoin. The voices of "Bitcoin is dead" and value FUD will pop up in the market from time to time. Perhaps it is precisely because it has re-reached the peak in the FUD again and again that the consensus on the evolution of its connotation has become more and more solid, and the social cognition caused by it has become more and more mainstream and universal.

If Bitcoin is simply regarded as an asset class, the evolution of its connotation is also accompanied by the change in the mainstream society's perception of its asset class. From speculation, alternative assets, digital gold narratives to mainstream asset allocation by mainstream institutions today, the social perception of Bitcoin is moving towards more general groups.

In the past 16 years, the development of Bitcoin has been accompanied by the global financial crisis, high inflation and the right turn of ideology. In the process of Bitcoin changing from a speculative tool to a mainstream asset, it constantly reflects the various drawbacks of traditional finance. It originated from the revolutionary ideal of financial freedom, but its growth depends on the collapse of the old financial world. It seems accidental, but it is inevitable. The public believes that Bitcoin's price and wealth effect have made it what it is today. However, if we look back at the 16-year history, we can see that Bitcoin is also on the verge of collapse and death. The price is the result of cognition, not the cause. The rise in each cycle undoubtedly shows that the old financial world has indeed reached a time when it needs to change.

2. Now: The rise of the right wing consolidates the digital gold narrative, and global regulation consolidates the prospects for institutional investment

As we enter 2024, we must re-examine the external environment facing Bitcoin. The world is currently at a critical juncture where geopolitical risks are frequent, the global mainstream ideology is turning right, and AI technology is in full swing. People's uncertainty about the future is unprecedentedly high.

In November 2024, Trump, a representative of the traditional right wing and leader of the Republican Party, won the presidency of the United States with an overwhelming advantage. His series of statements before and after the election provided the strongest endorsement for a more relaxed crypto regulatory environment. Bitcoin is highly consistent with the right-wing narratives of various sovereign countries. This is not only a high degree of ideological resonance. From a broader narrative perspective, the formal entry of Bitcoin assets into the mainstream, the concept of digital gold/value storage will officially become the main logic for trading Bitcoin, which will also bring strong confidence to countries and institutions that were originally on the sidelines. Not to mention the addition of its inherent anti-inflation/safe-haven properties in the context of frequent global geopolitical risks and repeated inflation.

It is not that Bitcoin is forcing its way into the mainstream world, but that the mainstream world urgently needs Bitcoin. Therefore, we have seen that in the past two years, from the United States, Europe, Hong Kong, Japan, and South Korea, all sovereign countries and regions have taken the same action to accelerate the compliance regulatory framework for crypto assets. All this is not to restrict the development of Bitcoin, but to get involved. After all, the promotion of regulatory compliance is not only the beginning of the recognition of the mainstream financial world, but also a prerequisite for financial institutions to enter the crypto industry in a big way.

Taking Hong Kong as an example, it has clearly experienced a process from observation and exploration to accelerated legislation. From the voluntary regulatory framework in 2018 to mandatory regulation in 2021, and then to the strategic vision of "establishing a global encryption center" from 2022. Hong Kong's regulatory transformation is also a microcosm of global development.

It is precisely because of the gradual clarification of supervision that HashKey Group was able to follow the Hong Kong government's perspective and become one of the first licensed and compliant institutions. Today, HashKey Exchange has become one of the largest compliant exchanges in Hong Kong and even in the Asia-Pacific region, with a capital scale of over HK$10 billion and a transaction volume of over HK$600 billion, an astonishing growth rate. According to the latest data from Coingecko, HashKey Exchange ranks among the top 7 global exchanges and is also the highest-ranked licensed virtual asset exchange in Hong Kong.

The fact that HashKey Group has been following the Hong Kong government's regulatory framework to build its own compliance system from the early stage shows that the management of HashKey Group has been aiming for the long term from the beginning. For enterprises, regulatory compliance has always been a cost, which requires strategic patience and progress. It may not be directly converted into operating income in the short term. However, as crypto assets such as Bitcoin become mainstream, the regulatory compliance system will inevitably become an invisible barrier to future competition. At present, HashKey Group has obtained all virtual asset licenses in Hong Kong, and has also deployed corresponding regulatory licenses in Singapore, Japan and other places. This invisible moat accumulated over time is transforming into a key advantage in commercial competition.

3. Future: From the United States to Hong Kong, compliance agencies play a key role and there is much room for innovation

If before 2024, Bitcoin had officially entered the ranks of mainstream assets in the financial world after 16 years of hard work, then in 2025, in the crypto-friendly environment marked by Trump's coming to power, a new chapter in the mainstream journey of Bitcoin and crypto assets will officially begin.

Looking back at the development history of Bitcoin, it is not difficult to see that as a relatively young asset class, every plunge of Bitcoin is inevitably accompanied by drastic adjustments in the industry. These adjustments are often related to the stalling of risk control. Financial freedom does not mean allowing financial fraud. Bitcoin's growth in a healthier environment is the key to its long-term vitality. Even after Trump took office, the relaxation of financial supervision has become a high-probability event, but this only means relaxation at the innovation level, not relaxation of compliance operations.

Taking Hong Kong as an example, the current interest and awareness of a large amount of institutional funds in the crypto industry is no longer a fundamental problem, but for these traditional financial institutions, their mature risk control and compliance systems basically do not allow users' assets to be invested without supervision, which is also a difficulty affecting the large-scale adoption of the entire crypto industry. Compliance-compliant exchanges (such as HashKey Exchange) are increasingly taking on the responsibility of large-scale adoption in the industry. At the end of 2024, MicroStrategy's success in the U.S. stock market triggered a wave of listed companies using Bitcoin as part of their asset allocation. According to incomplete statistics, dozens of listed companies in the U.S. stock market alone have allocated Bitcoin assets. Perhaps in 2025, this trend will spread to a wider range, all of which is inseparable from the increasingly mature supervision in the United States, Hong Kong, Singapore and other places.

If the past few years have been the stage of infrastructure construction for compliance, and compliance is still a game for a few pioneers, then there is a high probability that in 2025, as the regulatory compliance system improves, compliance institutions represented by HashKey Exchange will become the cornerstone for empowering and supporting the development of the entire industry. From institutional investors, retail users to industry entrepreneurs, they all need to explore the vast sea of ​​Bitcoin and the crypto industry on a compliant infrastructure.

As shown in the figure above, the industry compliance cornerstone represented by HashKey Exchange effectively links institutions, industry entrepreneurs, and retail investors. In the construction of the entire compliance system, it not only considers how to meet the current needs of users, but also focuses on how to connect traditional finance and Web3 with a solid foundation of compliance to achieve Mass Adoption at the industry level. This is a slow but correct path. After all, in the long run, only larger-scale user adoption is the key to the long-term development of the industry.

The seeds of creation planted by Satoshi Nakamoto have now grown into a forest. The former punk experiment is now favored by Wall Street giants, and the supervision of sovereign countries is becoming increasingly clear. The Bitcoin revolution, which started with rebellion and grew out of questioning, has been reborn again in today's era.

No one can set a limit on how high Bitcoin will reach in the next 16 years, but we all know that in the 5,000-year history of human currency, no system can dominate forever. For young Bitcoin, it still has a long way to go and many peaks to climb. As practitioners, we are fortunate to witness the birth of greatness, and we also hope to follow the general trend of the world, look to the long term, build a strong security line for users with compliance and security, and accelerate the arrival of the vast sea of ​​Bitcoin and encrypted assets. This is an opportunity, but also a responsibility.