Bitcoin News Today: Digital Gold vs. Programmable Cash: Institutions Reassess Bitcoin's Role

Stablecoin Growth Shifts Institutional Focus as BlackRock Highlights Bitcoin Limits

The rapid expansion of stablecoins is reshaping institutional perspectives on digital assets, with BlackRock and other major players questioning Bitcoin's long-term viability as a global payments solution. As stablecoins now account for 30% of crypto transaction volume, their role in emerging markets and decentralized finance (DeFi) has sparked debates over whether they encroach on Bitcoin's traditional use cases or operate in a distinct economic layer.

ARK Invest CEO Cathie Wood recently revised her 2030 Bitcoin price target from $1.5 million to $1.2 million, attributing the $300,000 reduction to stablecoins "usurping part of the role we thought Bitcoin would play". She highlighted their adoption in hyperinflationary economies and their utility in institutional payment rails, arguing that stablecoins-pegged to fiat currencies-offer transactional efficiency and stability that Bitcoin lacks. This sentiment aligns with Tether co-founder Reeve Collins' prediction that all currency could become stablecoins by 2030.

However, Michael Saylor, founder of Strategy, dismissed stablecoins as a competitive threat, framing Bitcoin as "digital capital" and stablecoins as part of a separate "digital finance" ecosystem. He emphasized Bitcoin's role as a store of value, akin to digital gold, while stablecoins facilitate programmable payments and settlements. Saylor argued that "no rich person wants to buy the currency" instead of an equity or real estate, underscoring the divergence in investor demand between the two asset classes.

Bitcoin's recent price volatility has further complicated its institutional appeal. The asset erased all its 2025 gains, dipping below $90,000 in November -a level not seen since April. This downturn triggered $254 million in single-day outflows from U.S. Bitcoin funds, with BlackRock's IBIT and Grayscale's GBTC bearing the brunt. BlackRock executives have since cautioned that their clients are not "underwriting" Bitcoin's case for global payments, signaling a shift in focus toward stablecoins and tokenized assets.

Meanwhile, innovative projects like Bitcoin Munari are attempting to bridge gaps in Bitcoin's utility. The project, which launched a $0.10 presale for its BTCM token, aims to extend Bitcoin's supply model with EVM-compatible smart contracts and privacy features. By initially deploying on Solana, BTCM leverages low-fee transactions and rapid settlement to establish immediate utility before transitioning to a dedicated Layer-1 chain in 2027. This approach reflects a broader industry trend of layering functionalities onto Bitcoin's foundational framework to address scalability and flexibility concerns.

Institutional adoption is also gaining political traction. The Bitcoin Policy Institute endorsed the Bitcoin for America Act, which would allow taxpayers to pay federal taxes in Bitcoin without capital gains liability, channeling proceeds into a Strategic Bitcoin Reserve. Proponents argue this creates a "democratic, market-driven" model for national Bitcoin accumulation, potentially bolstering the asset's legitimacy in mainstream finance.

Market participants remain divided on Bitcoin's future. While Saylor remains bullish, projecting Bitcoin's volatility to stabilize at 1.5 times the S&P 500's level, critics like JPMorgan warn that Strategy's heavy Bitcoin exposure could trigger index delistings and $2.8 billion in passive outflows. The debate underscores a broader tension: as stablecoins scale and regulatory clarity emerges, institutions are recalibrating their strategies between Bitcoin's speculative potential and stablecoins' functional utility.