A senior commodities strategist at Bloomberg Intelligence believes that the decline in bitcoin and ether amid growing adoption of cryptocurrencies will lead to higher prices for these assets.
Mike McGlone, an exchange analyst at Bloomberg research division, noted that the amount of mined bitcoins (BTC) and ethers (ETH) is limited by the code. According to him, the transition of Ethereum to the Proof-of-Stake (PoS) algorithm will reduce the amount of ETH in the market more than BTC.
“At the same time, the demand for assets and their implementation is clearly growing. The simple rules of Adam Smith and economics state that under such conditions, prices will rise over time unless something changes this trajectory in a negative direction. And now I see only growing acceptance and growth in demand. And this is just the beginning. I mean less than 1% of global stocks are in crypto,” he said.
According to McGlone, one of the advantages of crypto assets like bitcoin and ether over traditional commodities is that they do not incur storage costs.
“Now you can easily buy bitcoin and ether as an asset and as a commodity, put them in a mobile wallet on your phone, and never pay to store them. With goods, everything is not so simple – you have to pay 5%, or maybe 10% for storage, ”he explained.
McGlone’s forecast is supported by the star of the Shark Tank show, Kevin O’Leary, who, despite the drawdown of the investment portfolio, continues to invest in BTC and ETH. At the same time, Mohamed El-Erian, a senior economic adviser at the German insurance company Allianz , said that bitcoin will never become a global reserve currency for large investors and will not exceed $100,000.
