Money printing is driving people to Bitcoin, says Ledger CEO

On March 15, the decision by the US Federal Reserve to cut interest rates to near zero and launch a $700 billion stimulus package immediately sent ripples through the cryptocurrency market.

One day later, Bitcoin ignited a 104% revival which is still ongoing at time of writing. The rest of the crypto market followed Bitcoin’s lead, with many cryptocurrencies eventually outperforming BTC by many orders of magnitude.

Ledger CEO Pascal Gauthier says they’re related. Speaking to Decrypt, Gauthier said daily sales of their flagship hardware wallet matched an all-time high on March 15—the same day the US stimulus package was announced.

“On March 15, the day the Federal Reserve cut rates to zero and launched a massive $700 billion quantitative easing program, Ledger's Nano X hardware wallet mirrored a record sales day during the bull market,” he said.

The Ledger CEO also referenced a double-digit increase to Q1 growth compared to 2019, and pointed to a new wave of institutional and consumer interest ahead of Bitcoin’s block reward halving. He said, “While we don’t know how the upcoming halving will affect the price of Bitcoin, we do know that investments are pouring into the institutional market and more individuals are investing in Bitcoin than ever before.”

In addition to Ledger’s multi-coin hardware wallets, the firm also provides secure storage services for institutional clients through Ledger Vault. Gauthier said the current ramp-up in interest is similar to the one witnessed in 2016, in the run up to Bitcoin’s second halving.

“Despite external pressure on the stock market, we’ve had our best April ever. The crypto market continues to climb, in a trend very similar to what we saw pre-halving in 2016,” Gauthier said.

But not all crypto executives necessarily share Gauthier’s optimism. Don Wyper, COO of Digital Mint—a point-of-sales provider for over 325 Bitcoin ATM’s and tellers in the US—posited a more ominous view in anticipation of Bitcoin’s halving.

“We all expect a dramatic number of miners to shut down, given the adjusted income that they'll produce will no longer cover the cost of electricity. That decrease in hash power is likely to cause a difficulty adjustment, easing the difficulty of mining a block,” he said.

Wyper added, “What if some miners keep selling Bitcoin to pay for overhead, holding out for said difficulty adjustment, increasing supply, and putting significant downward price pressure on the market?”

Wyper holds out hope that the block reward halving will affect the Bitcoin price in a positive way, which would potentially avert the downward pressure domino-effect described above. However, the COO expects volatility in the short term.

“That being said, after the previous "halvenings," the price of Bitcoin skyrocketed, so my opinion is that, long term, Bitcoin is currently undervalued, and I expect short term increased volatility,” Wyper said.

Although Bitcoin’s volatility is nothing new.