As the 17 millionth Bitcoin is mined Thursday, institutional investors are likening the cryptocurrency to be better than gold - even as the value drops.
John Pfeffer, a partner at UK-based Pfeffer Capital, made a daring prediction that Bitcoin would reach the $700,000 mark, 70 times where it stands today, an even bolder forecast than the one by venture capitalist Tim Draper that the currency could reach $250,000 by 2022, earlier this week.
John Pfeffer, a partner at UK-based Pfeffer Capital, said
“Bitcoin is the first viable candidate to replace gold the world has ever seen. So if Bitcoin becomes the dominant non-sovereign store of value, it could be the new gold or new reserve currency."
The remarks were made at the Sohn investment conference in New York earlier this week, an event which is attended by Wall Street insiders where they often make recommendations on the best stocks to buy.
Pfeffer said that if Bitcoin displaced 25 percent of foreign reserves, the total worth of the Bitcoin network would be somewhere in the region of $6.4 tln.
John Pfeffer added:
“Most [other] crypto assets out there are bad bets.”
Perhaps the reason why investors like Pfeffer and Draper are still standing strong on Bitcoin compared to other cryptocurrencies is that as of today, only 20 percent or four mln Bitcoins remain to be mined.
While this marks a milestone, it is also a reminder of the increasing scarcity of the world’s most valuable cryptocurrency, experts say.
Each Bitcoin block produces 12.5 new Bitcoins, every 10 minutes, resulting in about 1,800 new Bitcoin are created each day.
At this rate, in six years all the Bitcoins will have been mined and there is no way to introduce more of it.
To reinforce his faith in cryptocurrency, Pfeffer donated 10 Bitcoins to the Sohn Foundation on the condition they did not cash them in for five years.
“Buy the ticket, take the ride.”
Despite these colossal long-term forecasts, Bitcoin’s current value hoovers under $8,555 unable to break $10,000 after dropping from $9,742 on Tuesday, and is trading at 48 percent lower than its year-to-date high of $17,527 in early Jan this year, based on data collected by Coinmarketcap.