Why Are Companies Choosing to Build on Bitcoin?

As the crypto market has continued to grow and evolve over the last decade or so, a number of issues that were previously left ignored to a large extent have continued to rear their ugly heads. For example, as things stand today, most blockchain networks lack one of three following aspects — i.e. decentralization, security, and scalability.

However, in recent months, many developments surrounding the Bitcoin ecosystem have helped mitigate the above-stated problems, thus making smart contracts, the realm of decentralized finance (DeFi), NFTs, and dApps more accessible to the masses. To elaborate, Bitcoin's ecosystem not only offers developers a deep liquidity pool but also a high degree of security.

Furthermore, with a growing list of peripheral technological solutions making Bitcoin more programmable, the currency's popularity amongst devs is growing at a rapid pace. In this article, we will seek to explore the core reasons why more and more companies are looking to build products on the Bitcoin network. So without any further ado, let's jump straight into the heart of the matter.

Bitcoin security and liquidity access remain unmatched

As the digital asset industry's mass appeal has increased, the need to guarantee the security of consumer data, their digital assets/ transactional activities has also spiked noticeably. In this regard, a whole host of popular 2nd and 3rd generation blockchains have been struggling with various security challenges. For example, Ethereum Classic was on the receiving end of a whopping three '51% security attacks' over the course of 2020 alone, with statistical data showing that a total of 12 successful major security breaches were witnessed in relation to major blockchain protocols recently.

Bitcoin has never been faced with such a scenario and has yet to be compromised even once. This is because the resources — both technical and financial — needed to facilitate such a coup are just too enormous, making the platform ideal for development activities of all kinds. Trust Machines is a project that is working towards creating the largest Bitcoin ecosystem in the world by promoting widespread utility for Bitcoin and allowing countless apps to build and utilize the popularity/security aspects of the network.

Trust Machines came into existence after the launch of the Stacks mainnet, a blockchain that allows for devs to deploy smart contracts and decentralized apps atop the Bitcoin base layer, with the goal of making Bitcoin's $1T economy more productive and innovative. By making the asset more programmable, Trust Machines can potentially help spur the value of Bitcoin as well as expose its users to a host of new use cases.

From a liquidity standpoint, it should be noted that a growing list of financial institutions as well as Fortune 500 firms have added BTC to their coffers. Not only that, countries like El-Salvador and the Central African Republic have declared the digital asset as legal tender within their borders. Lastly, back in early Nov 2021, Bitcoin's daily trade vol. topped out at a staggering $41.5B, vastly overshadowing the numbers put forth by rival cryptos including Ethereum ($19B), Binance Coin ($2.2B), Cardano ($7.3B), and Solana ($2.6B) over the same time frame.

Bitcoin has a lot going for it at the moment

Bitcoin has been recognized as being the "universal standard" for cryptocurrencies, with the asset's value determining the direction of the market at large for many years now Furthermore, statistical data clearly shows that more than 60% of the 38.22 million Bitcoin wallets in existence today have held onto the asset for a period of more than 12 months at a stretch.

This seems to suggest that the speculative appetite associated with the currency is reducing, especially when compared to other cryptos like Solana, Binance Coin, etc. Therefore, when developers choose to build on the BTC network, they can expect low levels of volatility since their users are not constantly chasing the next "big project" that can help them draw large short-term profits.

Looking ahead

There's no denying that BTC currently lays claim to one of the most diverse, untapped markets when it comes to the DeFi ecosystem. However, this potential is still in its relative nascency due to the currency's programmability limitations. Projects like Trust Machines are helping remedy this by allowing developers to freely design and deploy smart contracts and decentralized applications atop the Bitcoin ecosystem. Thus, it will be interesting to see how the future of the flagship crypto plays out from here on end.