Bitcoin at this point is down. It started the year in red. Currently, Bitcoin has struggled to maintain $4,000 and is trading at around $3,800 as of the moment. Since the start of 2018, Bitcoin and the rest of the other altcoins were seeing red. It was a stark contrast from its performance in 2018.
In addition to this, you also have the fact that institutional investors haven’t completely committed to the crypto market. Though you have the likes of JP Morgan that showed interest last year, the promise of regulatory clarity hasn’t been achieved.
On Its Way to Replace Gold?
But if you are going to ask someone like Lou Kerner who is a known Venture capitalist, he says that Bitcoin is on its way towards becoming gold’s replacement in terms of store of value. He mentioned that its market cap has already surpassed that of silver. He mentioned via Bloomberg that “What Bitcoin has evolved into is a store of value”. He also added that “Today, the main store of value is gold. It’s an $8 trillion (market). Bitcoin today is around $60 billion, so it has an opportunity to actually replace gold as the dominant store of value”.
Kerner is the founding partner of CryptoOracle. He further discussed that “The disruption from that is gonna be bigger than the disruption that we saw from the Internet”. He even mentioned that “Bitcoin is kind of the early leader, like the Yahoo of its day. And while it’s a massive thing, it’s not the thing (right now)”.
Forecast in the Next 2 Decades
Kerner is a believer that he pointed the future of Bitcoin in the next twenty years. He mentioned that “we really believe that in 20 years, Bitcoin will have created trillions of dollars in value similar to how the Internet has”. He mentioned that “We’re at the very beginning today”.
Despite the massive correction from December 2017 to today, Kerner said that “There’s something called Amara’s law, which is that the impact of all great technological changes is overestimated in the short run, but underestimated in the long run”.
What this means is that the true potential of Bitcoin and blockchain technology will be seen in the next decades. And therefore, it is too early to disregard its potential after the bearish market last year. It isn’t even the first time that it happened. Bitcoin had its share of corrections in the past ten years. Does this mean that it is a mistake to call Bitcoin the worst investment of 2018?
There has already been an increase in its adoption. In fact, cryptocurrencies are now accepted by a number of businesses. In addition to this, Bitcoin ATMs have doubled in 2018.
Kerner mentioned that “Gold has had a 5,000-year run”. He added that “If you look at the history of currencies over time, 100% of them—until 400 years ago—went to zero. And the truth is, if you think about the dollar, it’s a Ponzi scheme. And that’s fine because this is how governments work”.
Is it possible for Bitcoin to recover in the next years to come? Will it even thin out the number of cryptocurrencies? Will Bitcoin still be the market leader then?