Billionaire investor Mike Novogratz believes that the use of Bitcoin as a currency is not on the horizon for now. However, he assures that while that time comes, the most popular of digital currencies is being used widely and effectively as a large-capacity store of value.
“I believe that Bitcoin will not be used as a transaction currency for the next five years”Said the founder and CEO of Galaxy. The statements were made during an interview with Bloomberg.
These statements by Novogratz come at a time when Bitcoin is going through the best streak of the year 2020. During the last days, the price of the cryptocurrency is located at the barrier of $ 13,000 as a result of PayPal announcements in relation to with digital currencies.
Novogratz doesn’t believe in using Bitcoin as a currency in the short term
One of the reasons why Mike Novogratz believes that the use of Bitcoin, as a currency, will not happen in the short term, is its scope. Only small percentages of the population of economically advanced countries know and use cryptocurrency as a means of payment.
For example, in the United States, reports explain, only 7% of the population has ever used Bitcoin. In other nations such as Vietnam or Turkey, the percentage is higher. However, in the best of cases, the use of Bitcoin does not reach 30% of the economically active population.
In this sense, adoption is the main obstacle to overcome for the currency to acquire the status of money. According to the investor, this barrier should be overcome in the next five years or more.
All this would depend on the time it takes for the digital currencies of the central banks or CBDC to come into effect. Consequently, these would allow the tokenization of hundreds of millions of people, who would learn everything related to digital currencies.
In addition, when realizing that there is a decentralized, secure and more popular cryptocurrency like Bitcoin, people who join the CBDC will consider it as one of their favorites, especially because of its scarcity and constant appreciation, which makes it, no just different, but superior to stablecoins. But until then, as Novogratz puts it, Bitcoin only functions as a haven of value.
A store of value
Thus, taking into account the factors by which Novogratz assures that the use of Bitcoin, as a currency, is not on the agenda in the short term, what he considers the current function of this currency appears.
In this sense, the expert points out that Bitcoin is today, and especially in this context of pandemic and crisis, a store of value. One of the reasons for it being adopted as such by a growing number of high-caliber investors is the weakness of the US dollar and the fears that the spike in new coronavirus infections has unleashed.
“Therefore Bitcoin, as digital gold that it is, is going to keep growing”Stresses Novogratz. At the same time, it highlights that more and more people are going to want a portion of Bitcoin as part of their portfolios.
During the course of this week, the price of Bitcoin grew by approximately 13% and reached the barrier of $ 13,000 per coin. It is the best streak that the pioneer cryptocurrency has had during this year 2020.
Data to take into consideration
- Billionaire Mike Novogratz, is founder and CEO of Galaxy Investment Partners.
- The price of Bitcoin, at the time of writing, is $ 13,100 per unit.
- Paul Tudor Jones has highlighted the qualities of Bitcoin as a store of value.
- During 2020, the number of professional investors who have bet on Bitcoin, increased considerably.