Key Points
- Bitcoin developers see “programmability” as the next price rally catalyst for the coin.
- BTC trades near $67k.
Bitcoin is trading near the important mark of $67k, following a week that saw the price of BTC surging following the optimistic CPI report that showed an eased inflation of 3.4% for April.
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On May 15, when the latest CPI data came out, it triggered a price surge for the coin of 3%, with the markets reacting positively following the new numbers.
Bloomberg has recently shared a piece, detailing an important catalyst that could propel a new race for BTC’s price.
Bitcoin devs tout “programmability” as catalyst for next BTC rally
The other day, Bloomberg wrote that Bitcoin developers are saying that developers are looking for ways to add new functions on the original network.
They mentioned the success of Bitcoin ETFs approved at the beginning of 2024, and the halving event that took place on April 20 for Bitcoin as the main catalysts so far for BTC’s price.
According to the publication, developers believe that adding programmability to the Bitcoin blockchain will turn out the next catalyst that would propel the price of BTC, seen by many as digital gold, to new highs.
They note that the Bitcoin blockchain lacks the ability to easily support apps via the so-called smart-contract functionality that allows features such as self-executing agreements stored on the blockchain.
For years now, developers have been trying to rectify the intentional design flaw in various ways. For starters, they built Layer 2 networks, such as the Lightning Network, designed to scale Bitcoin for apps such as payments.
Some of them proved to be unreliable and the so-called bridges (software infrastructure to move tokens between networks – have been prone to hacks.
A lot of Bitcoiners have not been interested in using the coins for payments, continuing to hold them on better prices bets.
But, Bloomberg notes, without a fresh catalyst for renewed investor enthusiasm, Bitcoin retreated from its ATH of almost $74,000 hit back in March.
Things have changed after Bitcoin Ordinals began in 2023. This is a way to create nonfungible tokens by embedding data onto satoshis. After that, the anonymous developer Domo proposed BRC-20 tokens which use the same mechanism of inscriptions to issue tokens on the Bitcoin blockchain.
This sent developers searching for more ways to enable even greater Bitcoin programmability. Now, the community is considering proposals such as OP_CAT which would be a software upgrade to the network and make programmability easier to implement.
New programmability approach from Arch
Approaches also include one from a team that Domo is involved with, the Layer 1 Foundation, and another one from Arch startup that has just raised $7 million in a round led by Multicoin Capital.
Kyle Samani, co-founder of Multicoin said that this is a huge unlock for Bitcoin and really good for users.
Arch runs an application platform on top of Bitcoin, using software that will potentially allow apps from Solana to be ported onto Bitcoin.
Now, about 20 developer teams are building apps for functions such as borrowing and lending against Ordinals and DEXes, along with stablecoins.
Layer 1 Foundation builds a programmable module
Also, the Layer 1 Foundation is currently building a programmable module for the BRC-20 metaprotocol, which implies messages stored in code layered on the Bitcoin blockchain.
An indexer can find the messages and run computations in a similar way to Ethereum smart contracts. Bitcoin has a longer block confirmation time than Ethereum (10 minutes vs. 12 seconds), and this leaves more time to perform computations.
Eriz Ezerel, founder of Best in Slot Ordinals aggregator and explorer, notes that they can do more due to this factor. They call it chapter two in crypto, enough to support most financial applications.
The new type of programmability on Bitcoin could lead to an influx of DeFi apps. Bloomberg notes that the total value of tokens locked in the Bitcoin DeFi market is about $1.1 billion.
Toby Lewis, founder of OrdinalsBot, notes that Bitcoin’s DeFi ecosystem could grow to become the largest in crypto.
The recently launched Runes protocol is another potential catalyst for the Bitcoin overall ecosystem, triggering renewed hope.
The protocol brings new opportunities to Bitcoin and blockchain technology, and innovative possibilities emerge for the ecosystem, making it more resilient and safer, with higher economic potential while keeping a small on-chain footprint and encouraging responsible UTXO management.
