Rockefeller International’s Managing Director and Chairman, Ruchir Sharma, argues that Bitcoin (BTC) is really a brilliant concept. This one has been destroyed because of excessive speculative passion and easy accessibility to capital.
Bitcoin Rebound Is A Matter Of Time
Sharma (a New York Times best-selling author) and an ex-Morgan Stanley (MS) emerging market investor, predicted that bitcoin would see a similar comeback as Amazon. Amazon’s value fell by about 90% during the early 2000s dot-com collapse but increased by more than 300 times over the course of the following 20+ years.
Sharma admits that bitcoin will experience more turmoil in the months ahead, but this could also help remove the weaker players. Some say that it has already taken place.
According to him, Bitcoin is still “caught up in this speculative mania,” and is still indicating a partial worldwide collapse. The Amazon case was brought up again by him, noting the fact that the company took some time to recover. To match or surpass the 1999 frosty level, it took time for shares at the online retailer to recover.
Related reading| TA: Bitcoin Price Trims Gains, Key Breakdown Support Nearby
The early 2000s dot-com bust led to a huge decline in the value of Amazon’s shares. However, over the next 20 years the share’s value was able increase by more than 300.
He said:
“I’m not willing to call the [market]Bitcoin and other cryptocurrencies are at their lowest point as of yet. The U.S. bear market regime, which is the driver of risk appetite around the world, is still very much in play.”
Sharma forecasted that Bitcoin and other digital assets would suffer severe declines due to the continued slide in U.S stocks. Sharma pointed out that stocks often fall by 35% during bear markets. These can last for approximately a year. During this bear market that has only been going on for less than a year, the S&P 500 has only fallen by 20%.
BTC/USD drops below $20K Source: TradingView
Greenback Dependence May Be Endangered
Sharma supports a system of money that doesn’t dominate the US dollar. He said that although there hasn’t been a currency that can replace the dollar, bitcoin might be the solution.
“The dependence on the U.S. dollar, in general, cannot continue. A stable currency with some transactional needs is needed. Three to five years from now, hopefully BTC will emerge as a more stable asset.”
Sharma mentioned the Federal Reserve’s moves as well, saying that he didn’t foresee the risk appetite opening up just yet.
Related Reading | Bitcoin On-Chain Data: Miners Deposit Big To Derivatives Exchanges
Featured image taken from iStock photographs, charts and TradingView.com
