How Miners Can Tackle Bitcoin's Halving Problem | Markets Outlook

Summary

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Podcast Summary: Markets Outlook by CoinDesk

Episode: How Miners Can Tackle Bitcoin's Halving Problem | Markets Outlook
Date: September 24, 2025
Host: CoinDesk team
Guest: Jamie Leverton, CEO of Reserve One (formerly CEO of Hut 8)

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Episode Overview

This episode examines the challenges and opportunities facing Bitcoin miners as the network undergoes repeated halvings, reducing block rewards. The conversation dives deep into how the mining sector can adapt, the impact of evolving transaction fees, Bitcoin’s competition with other digital assets (particularly stablecoins), and the launch of Reserve One, a new public company focused on a diversified digital asset treasury. The episode offers insight into industry dynamics, regulation, DeFi on Bitcoin, and investment strategies for digital assets.

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Key Discussion Points & Insights

1. The Halving Challenge for Bitcoin Miners

[00:16]

• The Problem: With each halving, Bitcoin block rewards decrease, pressuring miner profitability.

• Jamie Leverton’s Perspective:

  • Miners’ long-term health depends on robust transaction fees.
  • The "ordinals boom" provided a glimpse into the future where user activity drives up transaction fees.
  • Miners are likened to "Visa, MasterCard and the Mint and security all rolled into one."
  • It's critical for Bitcoin to support meaningful on-chain activity to ensure miners remain incentivized.

  "The miners will be dependent on transaction fees... The more building we can do on the bitcoin blockchain itself, the more we can support the network and drive transaction fees into the underlying ecosystem. That's going to be critically important for the long-term health of miners."
  — Jamie Leverton [00:53]

2. Bitcoin Versus Stablecoins: The Jealousy Factor

[01:52]

• Discussion: Bitcoin predates stablecoins but hasn't captured the same transaction volume or regulatory clarity.

• Leverton’s Take:

  • There's some "jealousy" in the Bitcoin community over the explosive growth and regulatory clarity enjoyed by stablecoins.
  • Despite being around longer, Bitcoin still battles outdated narratives (like use for illicit purposes) and regulatory uncertainty, especially in the US and Canada.
  • Stablecoins have "managed to just kind of avoid a lot of that [negative scrutiny] entirely."

  "I think there is a little bit of jealousy that stablecoins have kind of let frog Bitcoin. And we're still fighting a lot of battles in the Bitcoin world that we've been fighting for years."
  — Jamie Leverton [02:11]

3. The Role and Future of DeFi on Bitcoin

[03:23]

• Host’s Prompt: What happens if DeFi on Bitcoin doesn't succeed as hoped?

• Leverton’s Response:

  • She’s optimistic DeFi will play out on Bitcoin eventually; the question is timing and form.
  • Legal and regulatory clarity in the US is essential for unlocking innovation and investment on Bitcoin.

  "That market structure coming out of the federal government in the US is really, really critical. I think we're all watching that very carefully and hoping that we see something in the next few weeks..."
  — Jamie Leverton [03:39]

4. Introducing Reserve One: Structure & Strategy

[04:13]

• Path to Public Listing: Reserve One expects to list on NASDAQ by year-end, with an S4 filing announced.

• Business Model:

  • 80% Bitcoin, 20% “Alt Sleeve” (Ethereum, Solana, ADA, XRP out of the gate; dynamic allocation based on market cap and yield).
  • Inspired by recent US government initiatives and designed as a one-stop exposure product for institutional investors.

• Management:

  • Broad, seasoned team described as the “Avengers of crypto,” combining expertise from crypto, Wall Street, and regulatory backgrounds.

  "We are giving investors a one-stop shop for exposure to the crypto ecosystem where we do the work as a sophisticated management team and board of directors."
  — Jamie Leverton [05:39]

• Yield Generation & Venture:

  • Strategy includes active yield generation, with ability to allocate up to 10% to high-conviction venture investments.
  • Team includes Sebastian Baer (President of Coinbase Asset Management) as President/CIO.

5. Dynamic Asset Allocation – The 80/20 Approach

[07:13]

• Philosophy: Allocation is guided by relative free float market cap and yield capabilities; allocation will adjust dynamically as the market evolves.

• Potential Expansion: More assets may be added if/when regulatory clarity allows.

  "If that alt sleeve outperforms and the free float shifts, then the allocations will dynamically shift on that basis as well, which would be a good thing."
  — Jamie Leverton [07:47]

• Current 20% Holdings: Ethereum, Solana, ADA, XRP.

• Weightings: Ethereum and Solana likely to have higher weights owing to higher free float and yield generation.

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Notable Quotes & Memorable Moments

• "Miners are responsible for the security of the bitcoin layer. They're responsible for processing the transactions. They bring new bitcoin into circulation. They're essentially Visa, MasterCard and the Mint and security all rolled into one."
  — Jamie Leverton [01:17]

• "I can't believe that argument [Bitcoin being used for illicit purposes] is one I still have to deal with on a daily basis, but it's true. And stablecoins have managed to just kind of avoid a lot of that entirely."
  — Jamie Leverton [02:11]

• "A bit of an Avengers strategy as we assemble... The Avengers of crypto."
  — Jamie Leverton [06:54]

• "We're here to support all of the above."
  — Jamie Leverton [08:02]

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Timestamps for Key Segments

• 00:16 — Introduction to halving challenges for miners
• 00:53 — Importance of transaction fees and ordinals boom
• 02:11 — Bitcoin vs. stablecoins and regulatory challenges
• 03:23 — The critical role of DeFi on Bitcoin and need for regulation
• 04:13 — Reserve One overview and launch details
• 05:39 — Differentiation from other treasury strategies; yield and venture
• 07:13 — Philosophy and mechanics of the 80/20 allocation
• 08:31 — Current altcoin compositions and future asset additions

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Summary Takeaways

• The future of Bitcoin mining depends increasingly on transaction fees as halvings diminish block rewards.
• There is some industry envy regarding stablecoins’ growth and regulatory clarity, which Bitcoin lacks.
• Legal clarity from regulators, especially the US Federal government, is a pivotal bottleneck for innovation in Bitcoin DeFi and the wider ecosystem.
• Reserve One aims to be a diversified, actively managed digital asset treasury offering institutional-grade exposure to leading crypto assets, with a team blending crypto, Wall Street, and regulatory expertise.
• Asset allocation is dynamic and will respond to market changes and regulatory signals, with a current focus on Bitcoin and major alts (ETH, SOL, ADA, XRP).

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This summary covers the essential discussions from the episode and highlights the evolving strategies in both crypto mining and digital asset investment.

Transcript

[Host]

Foreign guest was the CEO of Hut 8. She is now the CEO of Reserve One. Jamie Leverton, welcome to the show.

[Jamie Leverton]

Thank you.

[Host]

Always good to be here, I guess. Sam has a question for you. How are miners going to manage the hazard?

[Sam]

I will say, Jamie, I was at a private talk that you gave in New York City at someone's penthouse apartment. I think it was a year or two ago.

[Host]

I feel like it was Novograd.

[Sam]

I think you probably know exactly what this was. And I remember thinking this person knows more about mining than I will ever know in my life. And it was really fascinating. So I want to, I want to thank you for that moment. But I do think it's something that I wonder about of how just before we get into Reserve 1, how the mining industry, in your opinion, because you just know it so well, is going to manage over the years the continued having and the rewards just continually going down?

[Jamie Leverton]

Yeah, I mean I think we saw a glimmer of what the future should look like in the ordinals boom a couple of years ago because really over time the, the miners will be dependent on transaction fees. So the more building we can do on the bitcoin blockchain itself, the more we can support the network and drive transaction fees into the underlying ecosystem. That's going to be critically important for the long term health of miners, which we need. Miners are responsible for the security of the bitcoin layer. They're responsible for processing the transactions. They bring new bitcoin into circulation. They're essentially Visa, MasterCard and the Mint and security all rolled into one. So a very important part of the ecosystem that will be supported with transaction fees. And as I say, we saw it with the ordinal boom there's still over 100 years before the last bitcoin comes into circulation. So we have time, but it's really, it's going to be about transaction fees, I guess.

[Sam]

So I just want to go Oscar for one second, which is I love that because I think the ordinals did show us that there can be tremendous transactions on it. Do you think the bitcoin community understands or gets jealous of the sheer volume of stablecoins that are happening on so many other networks? And is it an area you see that coming to bitcoin?

[Jamie Leverton]

I don't like to speak for the industry as a whole, but we, we were in Washington last week, myself and another a delegation with the Digital Chamber including Michael Saylor and Tom Lee and lots of, lots of people that are really important to the ecosystem. And that thread came up a few times over the course of the day that bitcoin predates stablecoins. And yet we've got. We've got the genius act through, and we're still very much in conversation around clarity and the strategic bitcoin reserve. So, yeah, I think there is a little bit of jealousy that stablecoins have kind of let frog bitcoin. And we're still, we're still fighting a lot of battles in the, in the bitcoin world that we've been fighting for years. When we, when we think about the narrative that still comes at us about, you know, bitcoin being used for illicit purposes, I can't believe that argument is one I still have to deal with on a daily basis, but it's true. And stablecoins have managed to just kind of avoid a lot of that entirely. And now they have proper regulatory clarity, which we do desperately need in the United States and Canada for the rest of the ecosystem.

[Host]

I guess that really highlights the importance of bitcoin defi. That's been a theme at the desk.

[Jamie Leverton]

Yes.

[Host]

Here today. I mean, from your perspective, what happens if defi on bitcoin doesn't play out the way so many industry players hope it does?

[Jamie Leverton]

I think it will play out. It's just a question of timing. How long does it take? What. What forms does it take? I think it's really difficult to say. I go back to clarity. That market structure coming out of. Out of the federal government in the US Is really, really critical. I think we're all watching that.

[Host]

Very.

[Jamie Leverton]

Carefully and hoping that we see something in the next few weeks come out of Washington that gives us more, more direction. Because really that's what the ecosystem needs to focus their. Their energy and their efforts and their, their build billing.

[Sam]

All right, Jamie, reserve one.

[Jamie Leverton]

Yes.

[Sam]

Yes, tell us about it. It's expected to launch in Q4. It's a public company.

[Jamie Leverton]

Yeah.

[Sam]

What's the. What's the thesis? I know it's, you know, looking at this digital asset strategy play.

[Jamie Leverton]

Yes. So we expecting to start trading on the NASDAQ by the end of the year. We announced actually this morning, our time that we have confidentially filed our S4. So we're in that. That process with the SEC. I would say I expect a different experience with the SEC than my last go around with, with the Gensler regime, which warms my heart a bit. We announced our business combination agreement in July. We raised 750 million in a pipe. And then there's 287.5 million sitting back. Trust we are inspired by what we're seeing from the federal government. So the initial allocation will be 80% bitcoin inspired by the strategic bitcoin reserve and then 20% into an alt sleeve inspired by the digital asset stockpile. So expecting a mix out of the gate of the theory, I'm Solana Ada and XRP and that will evolve as we get more clarity from the Feds.

[Host]

All right, so one equity that gives investors exposure to that 80% Bitcoin, 20% other assets. Just talk to us a little bit more about the product. How is this different than some of the other digital asset treasury companies we've seen and some of the other miners who are mining and creating Treasuries and investing the yield from those Treasuries into other products?

[Jamie Leverton]

Yeah. So we're the only diversified digital asset treasury company. We've got a really unique management team and board of directors assembled. We are going to be running active yield generation strategies on the assets as well as we're lucky enough to have Sebastian Baer, who is the president of Coinbase Asset Management on the team as our president and cio so responsible for that yield generation. And the other thing we've built into our structure is the ability to allocate up to 10% of our aim into high conviction venture opportunities. So really giving the investors a one stop shop for exposure to the crypto ecosystem where we do the work as a, as a sophisticated management team and board of directors. Lots of experience across, across our team, not just in crypto with, with myself, Sebastian Reeve Collins, Gabriel Abed, John d', Agostino, but also private equity coming from Chin Chu and Wall street of course, and then Wilbur Ross bringing Wall street and regulatory, which Gabe also has as the Barbadian ambassador to the uae. So a bit of an Avengers strategy as we assemble. I was thinking that the Avengers of crypto, okay, it is, yes, I just want to be.

[Host]

And.

[Jamie Leverton]

But yeah, that's, that's the team and super, super excited to bring it to market. We really think that there's a new class of investors looking for the opportunity to get this kind of one stop exposure which you can't get in the, in the other assets that have come to market to date.

[Sam]

Jamie, I'm just interested in the 8020 play here and obviously there's a fair bit of maximalism coming out.

[Jamie Leverton]

But, but that's 20% accusing me of still being a max.

[Sam]

Not at all. But that's 20% also is full of, of opportunity. Right. Every one of those, those projects has a loyal community has very much a big moon opportunity coming. So, you know, is it partly just to say we want to be in the big five and we're going to figure out how to make this really work? Is there some thesis that says Maybe this goes 70, 30 if we see certain criteria met? I guess. How strict is your 80? 20?

[Jamie Leverton]

Yeah. So it's actually based on a combination of free float market cap with an ability to generate yield override, and that gets you to the 8020 today. But if that, if that alt sleeve outperforms and the free float shifts, then the allocations will dynamically shift on that basis as well, which would be a good thing. And honestly, I think we should expect a halo to come onto the tokens that are included in that digital asset stockpile. Once we get clarity, once we see that kind of incremental, incremental level of support from the Fed coming, coming to those chains, I think it should be really, really good for the ecosystem and for the builders in those communities. And we're here to support all of the above.

[Host]

What are the assets in that 20?

[Jamie Leverton]

I know there's XRP, ADA, ETH, and Solana.

[Host]

Oh, I guessed correctly.

[Jamie Leverton]

You did, yeah.

[Host]

Will you be adding assets?

[Jamie Leverton]

Yeah. Based on what we hear from the Fed, I expect they'll add a few more assets into the stockpile. When we get more clarity, remains to be seen when we'll get that CL from them, but as I say, we apply the mechanism of waiting. So Ethereum and Solana end up waiting higher just based on their free float metrics and their ability to generate yield. But that's where the management team comes in. And obviously we're making the best decisions, we think, for our investors and our returns.

[Host]

Jamie, thank you for joining us. I know you have a stage to get.

[Jamie Leverton]

I do. I have to run upstairs and get on stage, but thanks for having me. Yeah. Great. See you guys.