Four experts told us their long-term predictions for bitcoin — and the most crucial information that crypto novices need to know

Four experts told us their long-term predictions for bitcoin — and the most crucial information that crypto novices need to know

Bitcoin is rapidly gaining popularity but many observers are concerned about its volatility.

Insider spoke to four crypto experts to understand what the future holds.

The experts also shared the most crucial information that beginners should know before investing.

See more stories on Insider’s business page.

Bitcoin is rapidly gaining popularity as many look to the cryptocurrency as a valid medium of exchange or storehold.

But the digital unit of currency has its drawbacks. Its volatility is widely recognized among many, which has led investors, including Warren Buffet, to criticize it and other cryptocurrencies as “risky” and “worthless.” And now, with the recent rollout of China’s digital currency, discussions about bitcoin’s vulnerability are gaining momentum.

Insider spoke to four finance experts about their predictions for the currency.

Brock Pierce, the former ‘Mighty Ducks’ star turned crypto titan

When asked where he sees bitcoin in ten years' time, Pierce seemed bullish while also taking a swipe at the US government’s fiscal decisions.

He said: “After seeing the growth of bitcoin in the last six months (market cap exceeding $1 trillion), I’m very optimistic about the future growth of this technology. Our government’s poor monetary choices (overprinting, excessive spending, etc…) only work in bitcoin’s favor — and from what we’ve seen in the last year, there’s no sign of slowing down.”

For Pierce, the crypto landscape has drastically changed since its inception. But according to him, a major attraction of the cryptocurrency is the fact that “every transaction that has ever occurred is put on an open — public ledger making fraudulent applications nearly impossible.”

This is why he added, “if you haven’t done research on bitcoin or Blockchain technology — I would urge you to do so!”

James Ledbetter, editor, and publisher of the fintech newsletter, FIN

As fears loom over the effect of China’s newly launched digital yuan on bitcoin, Ledbetter said: “In general, the development of Central Bank Digital Currencies (CBDCs) can be viewed as an encroachment on bitcoin’s territory. If the digital yuan gains wide acceptance, it may discourage some people in China and elsewhere from investing in bitcoin.”

With a new wave of young people investing in the cryptocurrency, he added: “It scares me if people are getting into the bitcoin market because consciously or unconsciously they think it will never go down.”

This is among some of the reasons why people “should never invest more in any given asset than you can afford to lose,” Ledbetter added.

Joey Krug, co-chief investment officer at Pantera Capital

The reason why young people are investing in bitcoin is down to the fact that, in general, younger people tend to hold assets farther out on the risk curve than other groups, said Krug.

Young people see the government printing trillions in fiscal stimulus, threatening to rapidly debase the US dollar, Krug explained. Meanwhile, they have an increasingly strong sense that opportunities for socio-economic advancement are becoming fewer and harder to come by. “The result is that far more young people today own bitcoin than they own gold. That trend is not going to reverse,” he added.

Krug laid out three key areas for novices to pay attention to. He said: “First, remember that bitcoin could go down 70% or more. Second, know that it could go up many multiples of that.”

Finally, “in light of #1 and #2 — figure out an investment size that will allow you to hold bitcoin without driving yourself crazy or losing sleep over each short-term price swing,” he said.

He added that “if you buy too much relative to your other assets, you will inevitably panic and sell when it does go down. Bitcoin investing is a long game, and it isn’t for the faint of heart.”

Lucy Gazmararian, founder and managing partner at Token Bay Capital

“Today, bitcoin is increasingly being viewed as ‘digital gold’ due to its scarcity value as there will only ever be 21 million bitcoins in existence,” according to Gazmararian.

In terms of how bitcoin will be faring in five to ten years' time, she thinks it’s conceivable it could become the world’s reserve asset. She said: “There are early signs of this happening today with corporates around the world beginning to add bitcoin to their balance sheets.”

She added that money is set to become “a far more complex payment instrument than it’s ever been before,” with the onset of digital currencies.

This is because, in her view, it looks as though CBDCs, cryptocurrencies, and other digital representations of value will eventually interoperate seamlessly within our digital economy.

When asked about the essential information potential investors should know, Gazmararian highlighted two key points. “Develop your own view on this new technology and get clear on why you are holding it,” she explained.

She also believes “there are distinct operational risks associated with holding bitcoin “as it’s a purely virtual currency and can be stolen from your digital wallet if your private key gets into the hands of a nefarious actor.”

Crypto Market Value hits $2.5 Trillion as Ethereum Hits Record High

The total daily cryptomarket volume hovers around $246 Billion, which postulates a 13.65% increase. The

Bitcoin’s price is currently $59,219.08 with its dominance reaching a record low of 44.44%, while Ethereum’s dominance is at 18.3%.

Taking a fundamental look at Bitcoin, reveals investors see it has store of value, making the crypto asset’s dormancy a reasonable proxy for why many institutional investors use it majorly as a Treasury asset while Ethereum represents a far more active use for the global financial ecosystem, which is usually deployed for applications and smart contracts.

The sudden growth cited in the crypto-verse especially in the last four months is attributed to the credence gotten from leading global brands, with the likes of Mastercard, Tesla, PayPal, Visa, and even Hedge Funds showing significant interest in its technology and hedge against their traditional investments.

Market’s pundits have also cited that the heightened interests, emanating institutional record cash inflows as seen from leading hedge funds, and lately, the powerful financial brands that include Goldman Sachs, JP Morgan Chase, have bolstered the new financial asset class market valuation in breaking record highs.

Though Bitcoin and ether are the top leading crypto assets by market value and trading volume other crypto-assets like Polkadot, dogecoin, Chainlink, Cardano are trading near record highs, this suggests that the value of the cryptocurrency market could keep breaking new highs as more blockchain-based applications go mainstream.

Babel Finance raises $40 million as interest grows in Asian crypto

SHANGHAI (Reuters) – Hong Kong-based crypto lender and asset manager Babel Finance said on Monday it has secured funding from investors including Zoo Capital, Sequoia Capital China and Dragonfly Capital.

The $40 million fundraising, which also includes BAI Capital and Tiger Global Management, shows growing investor interest in Asia’s cryptocurrency players, Babel Finance said.

Babel CEO Flex Yang told Reuters that the round of strategic Series A fundraising, while not adding much to free cash flow, marked an alliance with traditional finance players.

It also marks debuts in Asia’s crypto finance industry for U.S. investment firm Tiger Global Management, European investor BAI Capital and Zoo Capital, the venture arm of China-focused private equity firm Boyu Capital.

Bitcoin mania has spread to Asia, and last month the asset management unit of Huobi Technology Holdings Ltd launched four crypto-related funds for institutional investors.

Bowen Wang, head of crypto at Zoo Capital, said in a statement it invested in Babel Finance to help build a gateway for the traditional market to access cryptocurrencies.

Yang, who is from China, said Babel will apply for business licenses in America, Europe and Asia, with a goal of meeting growing demand for crypto investment from mainstream investors.

Compared with the United States, Asia’s crypto sector faces a less friendly regulatory environment, Yang added.

Although regulators in China have banned crypto exchanges as well as initial coin offerings (ICOs), Yang said he was encouraged by deputy central bank governor Li Bo saying last month they were studying crypto as an investment tool.

“Regulatory uncertainty has been a source of risk for us. If the government moves toward more clarity, it’s a good thing for us,” Yang said.

(Reporting by Samuel Shen and Andrew Galbraith; Editing by Alexander Smith)