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Bitcoin is having a hard time lately, having lost over the year over 80% of its market capitalization. But the decline has not deterred Tim Draper from putting his trust in crypto technology.
The famous venture capital investor has predicted that half of the fiat holders could eventually switch to cryptocurrencies in the future. Speaking on the sidelines of the World Crypto Con conference in Las Vegas, Draper said Bitcoin will lead the new currency market that would allow people to spend, invest or do anything they want with cryptocurrencies.
The cryptocurrency market currently stands at around $ 130 billion, while the fiat market is worth around $ 86 trillion. Bitcoins and similar resources, according to Draper, are less expensive to manage and are more friction-free than fiat, which would allow an investment of at least $ 43 trillion in the space crypt.
"I mean, just from the one, only that they cost less, it will be better for people," he added. "And so they will move into a crypto and they will go away from the political currency – they call it fiat".
Hype vs Use Case
The technologists have praised Bitcoin for introducing a new and innovative transaction protocol for the financial market. The digital currency, however, has also faced criticism for being unstable and for its slow transaction times. In recent years, most traders have bought Bitcoin during its speculative run, which saw the price touch the record of over $ 19,000. But at the end of the cycle of hype, the bitcoin market recorded a massive annual decline, which is still at stake and brought the value to $ 3,400.
Nouriel Roubini, a famous American economist, called Bitcoin "a mother of all scams", stating that his value would eventually crash into nothingness. Warren Buffet, a Nobel Prize winning economist, also called bitcoin "a resource that creates nothing".
But for Draper, the decline reflects only a short-term shock and Bitcoin would eventually be an answer to all the problems of a fiat-based economy. The crypto-toro said that developing countries would find digital currencies more attractive than those with their high GDP linked to legal money.
"This is the way it will move," he explained. "And so they are saying the countries that are thinking ahead, that's the way it will be, so we're going to make a big mistake trying to hold on to our old currency and that's why you're seeing the smaller countries say all," 39; yes, we want bitcoin, we want the initial coin offerings (ICOs) here, we want blockchain.We want all these things in our country & # 39 ;. "
$ 250,000 in 2022
Draper reaffirmed his position that the value of Bitcoins will rise to $ 250,000 by 2022. People, according to him, would be less inclined to link their investments with assets whose price actions are driven by political forces. "I would prefer to have a global currency rather than one that is in some way linked to a political force," added Draper.
It is believed that the venture capitalist holds more than 30,000 Bitcoins in its investment portfolio.
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