The price of Bitcoin has gone down by over nine percent over the past 24 hours but according to the CEO of Circle, the leading cryptocurrency is going to be the winner in the end.
On a Reddit AMA earlier this week, Jeremy Allaire said that Bitcoin would become more significant as a store of value than as a payment and settlement protocol. Allaire has predicted that there would be millions of different crypto assets and stablecoin, for instance, they will be used for payments and settlements while commodity assets will act as a fuel for utilising networks, applications and different protocols. Allaire said, “our view is that crypto assets will continue to increase in all their forms […] We [think] SOV assets like Bitcoin will become much much larger and more broadly adopted and those other crypto assets will be used in an incredibly broad array of everyday transactions.”
Critics have argued that unless the leading cryptocurrency becomes stable, it would be anything but a store of value. Last year, the former chief of the Federal Reserve, Janet Yellen said that Bitcoin wasn’t efficient in terms of processing payments. As reported by CCN, Bitcoin was also dismissed by the financial service firm Allianz in its 2018 report by saying that the cryptocurrency had no inherent value in contrast to the fellow store of value assets such as sovereign bonds, paper money or equities.
There are believers though that say that the US dollar doesn’t have any inherent value and that the only reason people trust the currency is due to faith in the government. In addition, it also helps clarify the nostalgia for the gold standard, when the government papers had their supply measured by the amount of precious metal they held.
Zachary Karabell, the head of Global Strategies Envestnet said that if you “dig a bit deeper, and it becomes clear that gold itself has no intrinsic value. Its supply is limited (as is bitcoin, a strength of the digital currency), creating a relationship between supply and demand that cannot easily be manipulated.”
On top of this, Allaire hinted that focus from the leading cryptocurrency had to be moved to allow the crypto ecosystem for real-time user adoption.
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