While the cryptocurrency market has plummeted in 2018, Allianz chief economic adviser Mohamed El-Erian says “crypto is not dead.”
Without a doubt, 2018 has been a brutal year for the cryptocurrency ecosystem. A massive bull run in late 2017 led to feverish excitement and people jumping on board, causing prices to skyrocket even further. Reality set in at the beginning of 2018, and the total market cap for cryptocurrencies has fallen by a staggering 80 percent. Despite all the doom and gloom being shopped around, one prominent analyst declares “crypto is not dead.”
Down Year for Crypto
It is easy to feel down when looking at the cryptocurrency market. Prices for Bitcoin and other coins have dropped dramatically from their all-time highs. The media is gleefully trotting out FUD noting that the drop in the crypto market is greater than the dot-com crash back in 2000.
Yet, not everyone is getting ready to throw dirt on cryptocurrency’s grave and hold a wake. Mohamed El-Erian, the chief economic adviser for Allianz, says that the obituary for cryptocurrency is premature. He states:
Crypto is not dead, and certainly the underlying technology is not dead. We’re going to see more widespread adoption, by both the private and public sector, of the blockchain technology and related technologies.
Upbeat about Bitcoin
What is interesting is that Mohamed El-Erian is also upbeat about the future of Bitcoin. Most individuals in the financial sector love to bash Bitcoin while enthusiastically promoting the virtues of blockchain technology.
Speaking of Bitcoin and cryptocurrencies, he says:
In terms of crypto, what we’re getting is the realization that adoption is not going to be as big and as quick as the proponents of crypto would like. I think it’s going to be there, it’s going to last for a long time, it’s going to play a role in the ecosystem, but it’s not going to be the currency that a lot of proponents would like it to be.
A lot of the financial and business media are touting the decline of cryptocurrency, but the intriguing fact is that many institutional financial powerhouses are getting involved in the virtual currency market. Goldman Sachs recently said that rumors of them ending their plans of a Bitcoin trading desk are “fake news.”
Citigroup is reportedly launching a new product, the digital asset receipt (DAR), that allows major investors to get into the virtual currency marketplace without having to own any coins. The New York Department of Financial Services just approved the issuing of two new stablecoins, the Gemini Dollar and the Paxos Standard.
Do you agree with Mohamed El-Erian? Let us know in the comments below.
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