Bitcoin will replace gold as the store of value of choice within 20 years, says BlockOne CEO, Brendan Blumer. He tweeted “Over the next two decades, Bitcoin will replace gold as the leading commodity to store value”. And he’s not alone. Tyler and Cameron Winklevoss, founders of crypto exchange Gemini and also known as the ‘Bitcoin Billionaires’, foresee a bright future for Bitcoin.
The World Gold Council disagrees, saying that while cryptocurrencies may have a role to play in the financial markets, “their behaviour in an environment of market uncertainty underscored that they are not a viable substitute for gold as a safe-haven”.
Blumer, whose BlockOne startup raised a record $4 billion last year, believes that most economic activity will not take place on the Bitcoin blockchain itself. Instead, the majority of transactions will move to applications that will be built on top of the Bitcoin base layer.
“Most of the activity will flow to scalable layer-two solutions, but Bitcoin’s awareness and liquidity will continue to compound,” he explains.
Crypto Is Still In Early Stages
In an interview with the Telegraph the Winklevoss twins said Bitcoin and cryptocurrency will eventually be bigger than Facebook or Amazon. Interestingly, it was the settlement from Facebook’s Zuckerberg that funded Gemini.
“In the first ten years, a lot of people were like ‘Amazon isn’t competing with Barnes and Noble’. But we know how that played out. Cryptocurrency is so young, we are only a couple of years into this journey,” Cameron Winklevoss said. He added that cryptocurrency is transferring value and putting markets on certain resources which brings people into the space.
The World Gold Council claim that the perceived ability of cryptocurrencies to serve as a liquid, safe-haven hedge and store of value in times of market stress, did not hold.
“Though comparisons have been made, we believe there are several reasons why cryptocurrencies are no substitute for gold. Specifically, gold is less volatile and enjoys a more liquid and established market. It has a well understood role in an investment portfolio and minimal overlap with cryptocurrencies on many sources of demand and supply”.
But of course they’d say that.