Some of the biggest investors in the world – like Paul Tudor Jones – have stepped forward at some point this year to speak their praises for bitcoin. Now, a new investor – a major face behind Tesla, the Elon Musk-owned car company – is claiming that bitcoin could potentially serve as the world’s first global currency in the coming years.
Bitcoin Could Get Much Bigger Than It Is
Ark Invest analyst Yassine Elmandjra explained recently:
While scarce and durable, bitcoin also is divisible, verifiable, portable, and transferable, a range of monetary characteristics that confer superior utility, potentially driving demand and deeming it suitable, if not superior, for the role of global digital money.
Elmandjra is not just predicting big things for bitcoin. As an avid follower of Tesla, he explained that he sees the automobile venture reaching new heights by the year 2024, and that its shares and stock prices could increase “seven-fold.”
For the most part, Elmandjra appears right on the mark with bitcoin. The currency has done more than show its resilience this year. The currency has managed to overcome several obstacles including heavy volatility thanks to the onslaught of coronavirus cases that have come about since early March. Despite all this mayhem and the massive toll these cases have taken on the global economy, the currency has managed to come back stronger than ever, rising from the high $3,000 mark it struck briefly three months ago into the low and mid-$9,000 positions.
A currency like that certainly has what it takes to become a global asset. The only problem is that many companies still do not accept it for everyday purchases, and if bitcoin is going to replace money – like Elmandjra is suggesting – it needs to gain a stronger reputation amongst retailers.
Right now, many companies refuse to acknowledge bitcoin and its altcoin counterparts as money, claiming they are too worried about its volatility to accept it as a means of payment for goods and services. To an extent, we can understand their fears.
If someone walks into a store and buys $50 worth of merchandise with BTC, but then tomorrow the price goes down by $200, that’s going to affect how much the store made. The person who did the buying will still walk away with all their items, but the store who accepted the payment will have lost money granted they didn’t transfer the BTC into fiat right after the transaction was completed.
The Words “Digital Gold” Make Sense
Still, Elmandjra has high hopes for the world’s leading digital asset, claiming:
We believe, as a suitable contender for the first global digital money, bitcoin should attract demand that’s similar, at a minimum, to that of gold. Bitcoin’s complexity should not prevent financial institutions from analyzing it in depth. Yet, contrary to claims that it is in a massive bubble, bitcoin’s network value or market cap is less than two percent that of gold… We believe bitcoin not only shares many of gold’s characteristics, but it also improves upon them.