Bitcoin in 2017 went as high as near $20K level. And for many, it was a sign to enter the market hoping to actually earn some quick profits. However, the following year is a different story. Since the start of 2018, the bearish market dropped the value of the crypto market over the last months. And right now, the crypto market has lost around 80% since its peak.
Now, do you still hold on to your Bitcoin? If you think that it’s a good strategy to wait for the bearish market to calm down, then you are not actually alone. You also have Morgan Creek Digital Assets founder Anthony Pompliano who mentioned why you should stay committed to Bitcoin despite the price plunge.
He said that “We have very deep conviction on a long-term basis. And if you look at the fundamentals, the 24-hour transaction volume on the Bitcoin network is about $4.6 billion as of lately, and the market cap is $7 billion. So that’s about a 16-times multiple of transaction volume for market cap, That’s very similar to Mastercard which does about $11 billion worth of transactions and is valued at about $180 billion. So from a value perspective, it’s right there on par with Mastercard”.
Still in the Early Years?
Pompliano thinks that Bitcoin, despite only in its early stage, has been compared to Mastercard which started in 1966. Also, Bitcoin has beaten stocks, bonds, and fiat, and commodities in terms of performance. He then forecasts that in the next ten years, public equity performance will be relatively “bleak” compared to cryptos.
He believes that Bitcoin price will be ultimately driven by retail investors. He mentioned that there were few institutional investors before 2018. He thinks that the groundwork being done today will dictate the price movement of Bitcoin in the next two to three years.
Doubters Think It’s a Bubble
Nouriel Roubini mentioned that Bitcoin is the “mother of all scams”. He also tweeted recently that “Crypto went bust for good” after Bitcoin dropped since the Bitcoin Cash hard fork. Nouriel Roubini is the economist who predicted the 2008 economic crisis. He has been a critic of cryptocurrencies since it started. He even said that crypto market is a stinking cesspool.
You also have the likes of Bill Gates and Warren Buffet that expressed a negative view of the cryptocurrency.
But is it really too early to call Bitcoin a bubble? Regulators are providing the market with regulatory clarity. And despite the bearish market, you have the US Securities and Exchange Commission hunting down on ICOs that have sold investors with unregistered securities.
And because of this, many are comparing the crypto industry to the dot-com bubble. And for this reason, Bitcoin is viewed by some as Amazon which is a company that lost more than 90% of its value in a matter of two years only to become one of the largest tech companies to date. Could this be the future of Bitcoin? And also, does it mean that we haven’t seen the cryptocurrency hit rock bottom just yet? Should you just HODL and take the losses for now as long as you have a long-term foresight?