An ex-JPMorgan executive believes that every day Bitcoin does not disappear, it gets closer to a permanent status of digital gold. Alex Gurevich, who is also a professor of Mathematics, said this in an op-ed on Yahoo! Finance a few days ago. Bitcoin is the largest virtual currency but it has experienced a strong bear market during 2018.
Bitcoin Could Become Digital Gold
There are several virtual currencies available in the market. However, Bitcoin (BTC) is the most popular and largest one. During this year, the whole market has been involved in a downtrend that affected their prices. Bitcoin lost more than 80% of its price after falling from $20,000 in December 2017 to $3,500 a few days ago.
He mentioned that time is a very important thing for Bitcoin. As time passes and Bitcoin does not disappear, ‘it gets one step closer to a permanent status of digital gold.’ He then explained that in order for Bitcoin to become digital gold does not need to be a universal medium of transaction.
Mr. Gurevich mentioned that gold is neither the most common nor the rarest precious metal available. Additionally, he said that it is common enough to be a currency that can be used all over the world but not so common to disrupt the price through mining. In this way, gold was able to outperform competitors in the market.
Additionally, he asks whether Ether (ETH) would become the digital copper and Bitcoin Cash (BCH) the digital silver. That means that the value of Ether will be driven by technology demand and Bitcoin will work as a store of liquidity value.
He commented about Bitcoin and the historical trading pattern in precious metals:
“Given the historical trading pattern in precious metals, the buy of Bitcoin in 2015 was relatively easy. But now, at 20X (including fork) the early prices, it is a more complicated trading dilemma. Bitcoin may or may not be a ‘bubble,’ but it is important to remember that it did have a major ‘burst’ in 2014 and, even this year, the market has witnessed Bitcoin endure tow meaningful corrections.”
Furthermore, he said that every single time that Bitcoin survives one of these bear markets and it stabilizes, it gets ‘extra gold credibility.
At the time of writing, Bitcoin is being traded close to $4,150 and it has a market capitalization of $72 billion. There are several experts and analysts that believe that Bitcoin will continue to grow in the future.
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