Big investors continue believe that cryptoassets will replace fiat money. They are undisturbed by the recent drop in Bitcoin valuation, according to a recent report published by Avi Salzman, Barron’s magazine senior editor.
There has been a drop of about 55% in the value of the cryptoasset market(from $829 to $372 billion) in the past few months. In January, this year, the valuation of cryptoasset market nearly stood at trillion dollars with few blockchain projects in their infancy.
Bitcoin has dived down to 58% of its value since December, 2017 peak. The devaluation has mainly happened because of regulatory uncertainties which have recently barged in.
But the surprising fact is, even though the value of major cryptoassets, Bitcoin, XRP(Ripple), Bitcoin cash, and Ethereum have reduced significantly, the report says that the big investors are still optimistic with respect to the status of cryptoasset and believe that it will soon replace fiat inevitably, despite all the devaluation.
Interestingly, Tom Lee, the research head and co-founder of Fundstrat, predicted that we could still see Bitcoin hitting $25000 this year. He added,” It’s overdue.Bitcoin was incredibly oversold. When you look at the metrics like price to book, which is money cost or out Bitcoin misery index, it’s pretty much what you saw at the end of 2014 bear market, not the start.”
Although we may not see Lee’s prediction turning true in near future, what stays remarkable is the fact that all the uncertainties of the cryptoasset markets do not seem to shake the big whales.
Increasing inclination towards Cryptoasset world
An increasing number of industries, government and non-government organisations, banking sector, real estate, retail stores, e-commerce and individuals are getting involved with cryptoassets. Most individual investors look for a short term investment opportunity in the crypto market while the big investors look out for an accumulation period and long term opportunities.
Brian Kelly, CNBC Fast money contributor and founder of BKCM digital asset fund also said that he was surprised that market did not react to major institutions like JP Morgan and New York Stock Exchange entering into the crypto market. More so when the crypto market was at an all time high and could have easily gone beyond the $1 trillion mark!
The CEO at Shapeshift (leading instant digital asset exchange), Erik Voorhees said, “I’m all for financial companies getting involved in crypto. Crypto as a monetary unit is transparent and legitimate because it’s market-based, as opposed to what they do now, which is handling fiat, which is not transparent and not market-based.”
Voorhees believes that cryptoasset will inevitably replace fiat currencies in the near future and further stated that he does not believe that financial companies will try to curb this change as their ultimate business aim is chasing money, according to the report.
The road ahead
It’s predicted that price of Bitcoin could further dip in the near future from $8000 mark to $7000 and then subsequently rise back to $10000. Of course, no one can exactly predict what will happen in the future, but at the expert level, big investors believe that cryptoassets are here to stay in some shape or form!