Bitcoin faces the risk of bank runs, small businesses are easily affected by the death spiral event
On November 24, there were rumors that Bitcoin would be used as part of strategic reserves, and the phenomenon of businesses adopting Bitcoin is becoming increasingly common. Bitcoin is emerging as a possible reserve asset, which has led experts to start thinking about how the development of a bank run on Bitcoin will unfold. Cryptocurrency analyst and Chief Information Officer of European cryptocurrency fund Cybercapital, Justin Bons, stated that due to the technical limitations of the first blockchain, Bitcoin is easily affected by bank runs. In the event of a bank run on Bitcoin, small businesses will face risks. A drop in price will trigger this hypothetical event, forcing miners to shut down operations due to lack of profitability and affecting network operations.
