May 22, 2019
The ONE question the entire world is asking is...
As Bitcoin celebrated its 10th anniversary in January this year... History reminds us that the crazy ups and downs have been stronger than a giant human catapult constantly driving everyone in either FOMO or FUD! More and more global figures are popping out of the woodwork to make either 1) very harsh/ bold OR 2) enthusiastic/ optimistic predictions as to where the BTC price will end up in the future... In this article and thanks to curating and consolidating data from multiple reliable sources, you will be able to enjoy what we call the “The SUPERHEROS vs The Supervillains” of Bitcoin".
Here are the most famous names in the game so let’s have a look at WHO are these people, WHAT are their predictions and By WHEN. But more importantly, something that many sources have consistently neglected in the past... The WHY?!!! The WHY is the rationale behind each prediction that needs to be stressed for us either agree or disagree and help build our own opinion on the future of Bitcoin…
(All the reasons are quotes from the figures themselves which in some cases are paraphrased or summarised to simply make the content easier to digest)
“BTC’s value is measured based on its cost of production (mining), as well as the total number of users and transactions on its network. So instead of a bank printing an endless amount of dollar bills, this protocol puts a pre-defined supply cap over bitcoin printing – 21 million units – and allocates the task of minting to thousands of miners. The result is a protocol that transfers funds more cheaply than an average bank. On top of that, it also manages the record of each transaction without needing intermediaries”.
“Fiat currency will become “laughable”. Draper believes his money in the bank is less secure than his money in Bitcoin.Yes. We are talking [...] about five percent market share to get to $250,000. The current global money supply (including digital money) is equal to 80 trillion USD. 5% of the global money supply = 4 trillion USD possibly being injected in Bitcoin’s Market cap. Bitcoin has a market cap of roughly 90 billion USD at a price of 5000 USD per bitcoin. So simply put, Bitcoin would have a multiplier of approx 40X leading to over 200K USD per bitcoin. That seems like a drop in the bucket and all we need is to make Bitcoin usable like buying Starbucks coffee, and all of a sudden the world just opens up and will say ‘I’ve got this choice.’ [...] Do I want a currency that I can take from country to country [...] or do I want one that sticks me in one country or one geographic area which means I can’t use it anywhere else?”
Tom Lee has been inspired by Metcalfe’s law to have a more accurate valuation model often utilised for tech companies such as FB, Uber etc.. Based on the network effect and user adoption. Examples of user adoption are for instance the growth in number of active wallet addresses, the growth in transactions per account, and “factors influencing supply and scarcity”. Tom stresses that BTC’s p2p transaction volume has already surpassed paypal by more than 2X in 2018 reaching a total volume of 1.3 trillion dollars. If the number of BTC wallets approached 315 million, or 7% of Visa’s 4.5 billion accounts plus a number of key metrics in his deeply researched report, reaching 125K is not unfeasible. Tom is also one of the only experts to put strong emphasis on generational gaps bringing significant changes in investment styles based on the peak of each generation’s age and disposable/ investable income.
“Monetary policy has become a joke. We are facing a major debt crisis. All it did was fuel buybacks and inflate asset prices. As questions grow about how independent the Federal Reserve is and we see it run out of options, people will turn to digital assets. Bitcoin will become a hedge against the uncertainties of “irresponsible” monetary policies”. Naeem sees up to a 2000% price appreciation from recent ATH based on the combination of the factors stressed above.
“Bitcoin is a “digital gold” and continued erosion into the market cap of these ancient stores of value is central to his theory. Gold’s got an $8 trillion market cap and so, we’re 100x off on that. Microsoft, one of the biggest companies in the world, is credentialing Bitcoin by building digital identity on its chain.. Novogratz has noted that institutional investment is inevitable and eventually, the herd is coming.
Arthur Hayes, Bitmex
Believing that a market recovery from the peak in 2018 was foreseeable. “The 2019 chop will be intense, but the markets will claw back to $10,000. That is a very significant psychological barrier. $20,000 is the ultimate recovery. However, it took 11 months from $1,000 to $10,000, but less than one month from $10,000 to $20,000 back to $10,000” stressing the parabolic moves.
“The internet will have a native currency and Bitcoin is something that was born on the internet. Bitcoin wallet addresses are up about 20 percent from the January 2019 lows, it has reached the highs at the levels we saw in the spring of 2018 when Bitcoin was well above $6,000. As a part of the Bakkt deal, Starbucks is set to integrate Bitcoin payments into their system in the next 18 months. These merchants will get access to the Lightning Network in the near-term and when it does, Dorsey sees a strong push in the adoption of the second-layer scaling solution.”
The generational impact of money transfer to millennials is key:
Millennials will by then own 30 trillion USD and if 1% of the total sum is invested in BTC, Bitcoin will hit 50K USD.
“Bitcoin is the BEST performing asset among all asset classes in the past decade. Bitcoin’s valuation is based on mining and scarcity. At that point, the Bitcoin block reward will decrease from 12.5 to 6.25 BTC, halving the supply of new BTC entering the market from mining and, increasing its scarcity. On top of the total supply of 21 million BTC between 3 to 4 million are lost forever. George also likes to emphasise that Bitcoin has almost set yearly higher lows since its creation which shows strong resilience. And last but not least, Bitcoin is a non-correlated asymmetric asset that does not rely on GDP, earnings, interest rates, inflation and any economic indicator on the planet.”
Just to get this straight for everyone, the term “Supervillains” is simply to add a fun spin to the article. Despite our strong pro-blockchain biases, some of the figures listed below are living legends (2 noble prize winners and one of the most successful investors of all time). For instance, Robert Shiller is not only a noble-prize winner but an incredible economist, professor, and author. Needless to say but will say it anyway, Warren Buffet is one of the most talented investors in the history of finance and a true philanthropist, therefore, we need to pay our respect to these gentlemen for their amazing accomplishments.
Now, if you look closely, we can notice that the “Supervillains” happen to all be above 60 years which categorises them all as the “baby boomer” generation. Another observation is that the majority of these figures come either from traditional academia or finance and according to Wikipedia do not have legitimate qualifications nor publications in the field of emerging technologies. Without further due, let’s have a look at our next list!!!
Buffet went from calling BTC “rat poisoned square”, emphasising that Bitcoin is not a currency and does not meet the test criteria to be one especially since BTC still depends on fiat currency such as the dollar when using it or cashing out (possibly classifying bitcoin more as a commodity than a currency). In a more recent statement (Q1 2019), Buffet has claimed: “Bitcoin is ingenious and blockchain is important but Bitcoin has no unique value at all, it does not produce anything, you can stare at it all day and no little bitcoins come out.” “It’s a delusion basically. This is explained to me by people who are a lot smarter than I am. Blockchain does not depend on bitcoin so I’m sympathetic to people who own it.”
Bitcoin is a bubble however Robert Shiller does not believe that the most popular virtual currency will disappear from the market or just go to zero. Robert also claims “Practically no one, outside of computer science departments, can explain how cryptocurrencies work,” wrote Shiller. “That mystery creates an aura of exclusivity, gives the new money glamour, and fills devotees with revolutionary zeal. ...it's a story that I think goes way beyond the merit of the idea. ... It is more psychological than something that could be explained by the computer science department. “It is a speculative bubble. That doesn’t mean that it will go to zero.
Blockchain technology is the most hyped technology and it has no real use cases. Institutions will never enter this space due to the lack of regulations and laws and meet the compliance standards as regulated companies. The entire market is entirely manipulated through wash-trading, pump and dump schemes and front-running. Billions of people doing billions of transactions every day are already using digital payment systems such as Alipay, Wechat pay, Venmo, UPI system, Payza.. Bitcoin is essentially used for money-laundering, criminals, terrorists, tax-evaders etc… 75% of mining is controlled by 3 or 4 players which is centralised. Bitcoin among all shitcoins will be there but close to zero.
“My feeling is that when you regulate it so that you couldn’t engage in money laundering and all these other things, there would be no demand for bitcoin. So by regulating the abuses, you are going to regulate it out of existence.” Just recently, as of May 2019, Joseph continued to push this message by saying that he believes in digital payments for their efficiencies with the USD and said that due to “economic illegal activities, we should shut down the cryptocurrencies.”
“Governments will crash it (Bitcoin) one day,” he remarked.
According to Jaime, blockchain will be used to transport money from one place to the other, but not necessarily Bitcoin. Instead, it will be moving US dollars.
But “redemption” is possible, as one of the strongest supervillains has seen the potential of the Blockchain and now wants to launch the JPM Coin. Let’s hope time will slowly but surely change the minds of these bright people.
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