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Bitcoin’s Q1 was a bit of a rollercoaster (as seen in the image below), but has returned to, more or less, the same price levels when the year started. BTC is trading around ~$45,000 after dipping below $35,000 on some exchanges. 

While numerous headwinds remain, one bullish takeaway is displayed below by BTC long-term HODLers. The percentage of the BTC supply that has not moved in over one year (a proxy for long-term HODLers) is nearing all-time highs. For reference, the last time it reached similar levels, Bitcoin was sitting around ~$10,000 in Q4 2020. This illustrates BTC holders are holding with the same conviction, despite the price being 4.5x higher.

BTC Miami 2022 Announcements and Headlines

• Two separate jurisdictions, one in Honduras and the other in Portugal, announced that they would create new policies designed to incentivize bitcoin adoption. 
• Strike partnered with Shopify to create a new US payment system. Shopify, Robinhood, BitPay, and others also announced Lightning Network integrations.
• Lightning Network Labs announced Taro, a Lightning Network L2 project aiming to bring stablecoins to the Lightning Network. 
• Tesla, Block, and Blockstream are partnering to mine BTC through solar power.

BTC and Terra

Cover your ears Bitcoin maxis, but part of Bitcoin’s recent price turnaround may be attributed to an altcoin! In February 2022, the Luna Foundation Guard (LFG), a non-profit organized to support the Terra ecosystem (ticker LUNA), announced that it raised $1 billion to purchase bitcoin as new collateral/reserve to back the Terra UST stablecoin. 

LFG hopes that by introducing BTC as a reserve asset, it will reduce the risk to LUNA in the event of a downturn in demand for UST. Now, rather than being solely reliant on the LUNA burn mechanism, UST has diversified its risk management by introducing a Bitcoin backstop. A bitcoin reserve allows LFG to send UST burners bitcoin in addition to creating new LUNA supply, buffering the impact to LUNA. 

Terra Founder Do Kwon has stated that he plans to buy $10 billion worth of BTC to backstop UST and signals on social media suggest he is already buying $125 million worth of BTC every day. 

BTC and oil

As previously mentioned, ExxonMobil is expanding its flared natural gas Bitcoin mining pilot program to potentially four new global areas along with the help of Crusoe Energy. One of the world’s largest oil producers aims to use and sell the otherwise useless byproduct of oil drilling while also reducing impact to the environment.

In certain areas, when drilling and producing oil, natural gas is also produced. Oil producers have to do something with that “associated” gas and, if there is no pipeline to transport this gas (which is often the case in the remote drilling areas), it’s usually reduced to “flaring.” In this common scenario, the best thing to do is to flare–or burn–the gas so the hydrocarbons are broken down in a combustion reaction to CO2 and water. Flaring is better than simply releasing the natural gas into the atmosphere, but we can do better. When gas is flared, it’s essentially wasted in the sense that the energy content of that gas wasn’t productively used.

Rather than flaring, that same “stranded” gas that has absolutely no other use case or economic value can be converted into electricity using cheap, small-scale turbines on-site. This is a perfect energy source for bitcoin miners and their ability to go to the source of energy. Bitcoin miners want the cheap energy and the oil producers want someone, anyone to buy it. Because Bitcoin miners are nimble and not geographically tied down to one spot, like a large plant or pipeline, they provide an economic solution for both parties while reducing the climate impact of oil drilling. It’s truly a win-win scenario. 

Switzerland town makes BTC legal tender

In March, the small town of Lugano, Switzerland made bitcoin legal tender, allowing its citizens to pay annual taxes and city services in bitcoin and Tether (USDT). Lugano joins the country of El Salvador in formally recognizing BTC as legal tender.