We will often hear Bitcoin Maxis humble brag that they don't think in dollars anymore. They think in satoshis. 🙄 They envision a world in which everybody hodls their Bitcoin and simultaneously use the same Bitcoin for daily transactions. Anybody who has used Bitcoin knows that native Bitcoin is almost useless for retail. It is too slow and can sometimes have high transaction fees. You can't reasonably buy a cup of coffee with Bitcoin unless you're trying to make a point. Therefore, there are workarounds such as the Lightning Network, which is great for small transactions at the point of sale. It's fast and less costly than paying with actual Bitcoin. An intrusive thought popped into my head as I was driving today. Lightning is a stablecoin for Bitcoin. If you're into Liquid Network, that's another Bitcoin stablecoin. A Lightning satoshi has the same value as a Bitcoin satoshi.
For that matter, Wrapped Bitcoin is also a Bitcoin stablecoin. There was never any need to invent entire networks that only run Bitcoin. A satoshi on Ethereum, while expensive to transact, is just as good. But on other networks like Arbitrum, Solana, Sui, or Stellar (just to name a few) these Bitcoin stablecoins can also be transacted affordably and quickly. And they can also handle other stablecoins at the same time.
Yes, yes. You run the risk of the smart contract getting hacked. Blah, blah, blah. We're talking about spending money . . . spending Bitcoin, not your life savings hoarded in a cold wallet. We can apply a variant of the Lindy Effect. The longer WBTC survives without being hacked, the more likely it will continue to remain unhacked. Shall we call it the Bindy Effect? Moving on.
What if the Wrapped Bitcoin (WBTC) depegs? I never understood that argument. Depegging is a market phenomenon. If you took your depegged WBTC to get unwrapped, you'd get back a BTC satoshi for every wsatoshi. This is the same for USDC. It only depegs on exchanges. If you were to redeem USDC for dollars with the issuer, you'd get back every penny. If Wrapped BTC depegs to the down side, you're getting cheaper Bitcoin.
Let me circle back to my main point. We're thinking about WBTC as if it were BTC. If you are living on the Bitcoin standard, then WBTC works just as well for saving and spending. You might still want to save actual BTC somewhere for long term savings. But for your daily financial needs, Bitcoin stablecoins are a great substitute in any of their forms. They are faster and cheaper to transact. And, you can use some of them for DeFi.
I actually had a sister intrusive thought pop into my head after the first one. If Hive ever decided to scrap HBD because the dollar becomes too devalued, it could be substituted with HBS (Hive Backed Satoshis). I haven't really put much thought into this, but I wanted to put it out there.
I've been using USDC, DAI, and PYUSD for transferring between accounts, primarily to avoid tax headaches as the cost basis is always $1. But once transferred, I've been converting to BTC in an attempt to live on the Bitcoin Standard. But it's challenging to use Bitcoin Standard for small transactions. I end up having to convert lump sums into fiat or something more easily spendable. Or, I have to leave the BTC on an exchange so that I can spend it with a debit card. What I have not seen is any effort to treat WBTC as the stablecoin that it is, while Lightning gets all the attention for doing the same thing. We need to start seeing WBTC (or cbBTC and cdcBTC) for what they are, Bitcoin stablecoins. We don't generally think that USDC or USDT are wrapped dollars. But that's what USD stablecoins are, in essence (not technically, they're wrapped bonds). Therefore, wrapped satoshis are the equivalent of plain satoshis, except more useable.