Venture capitalist, billionaire and former Facebook executive Chamath Palihapitiya believes investing in Bitcoin is an insurance against the uncertainty of the future. The monetary influencer was speaking to CNBC regarding the state of the economy and investment in general on Thursday.
Due to the Coronavirus pandemic, the world economy suffered a lot. The slowdown of the economic situation and activity resulted in a dire situation for many businesses around the world. As a result, the governments of the world announced big stimulus packages to help the businesses and masses. In the short-term many availed this opportunity and managed to stay afloat, but, big money spendings increase the national debt limit and cause long-term problems for the economy. This abundance of easy money is resulting in reduced faith in fiat currencies and slowly bringing people to invest in safe havens and upcoming assets like Bitcoin itself.
According to Chamath Palihapitiya, who is a billionaire and a venture capitalist, investments in Bitcoin will be an insurance against the uncertainty of the future. He said:
The reason is because, everytime you see all of this stuff happening, it just reminds you that wow our leaders are not as trustworthy and reliable as they used to be…., So just in case, we really do need to have some kind of, you know, insurance we can keep under our pillow that gives us some access to an uncorrelated hedge”
Palihapitiya belives that Bitcoin will reach around $200k in the coming 5-10 years and will be a major disrupting force in the world as a result. If this proves to be true and no reason it can’t since it just hit $42k recently, it will be a big turning point for the cryptocurrency sector as estimates put it the value by which governments cannot afford to remain away from it. However, it may also put cryptocurrencies in direct clash with the governments and it remains to be seen what kind of regulatory pressure they can exert collectively on the sector.
Bitcoin hit $42k earlier yesterday and has remained stuck in a narrow trading range since then above $40k. However, some of the other cryptocurrencies are reporting considerable price increases including Bitcoin Cash (BCH), Yearn.Finance (YFI), Cardano (ADA) and others. The total market capitalization of the sector is now way above $1 trillion and growing every week or so.
Image source: pixabay.com
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