Billionaire investor and long-time Bitcoin bull Mike Novogratz shared some interesting views on the current state and future of the leading cryptocurrency by market capitalization.
While Novogratz has been an overwhelming proponent of Bitcoin and cryptocurrency, recently predicting that BTC would reach $20,000 by the end of 2020, he believes that the coin is reaching the end of its potential as a store of value. Speaking at ConsenSys’ Ethereal Summit May 11 on a panel titled, “The Herd is Still Coming!,” Novogratz explained that Bitcoin largely functions as a digital store of value and has managed to build on its competition by the being the first cryptocurrency to market, saying “it came first.”
As far as the potential for new development or innovation as a store of value, Novogratz claims that the coin is “kind of finished” in terms of maximizing that specific use case. Novogratz then made the common analogy of Bitcoin as a digital for of gold, claiming that both serve as a store of value for investors but largely function as social constructs. Similar to investors buying Bitcoin, gold continues to hold and change in value based off the expectations of its social surrounding, as opposed to exhibiting truly intrinsic worth.
Despite being historically bullish on BTC and cryptocurrency, Novogratz concluded that Bitcoin was unlikely to change the world. Following up on his comparison of Bitcoin as a store of value, and being a limitation of the currency’s use, the former Wall Street exec claimed that BTC is “not going to change the world.” Instead, Novogratz highlighted ‘Web 3.0’ as the most likely technology to institute dramatic change, stating “it has potential to change the world.”
Some community members have found fault in Novogratz’s take on Bitcoin’s limited use, and for relying on the tired comparison to gold. However, the billionaire investor’s comments appear to be more in support of ‘Web 3.0’ as opposed to an indictment of Bitcoin. He also coached the limitations of Bitcoin in a broader criticism towards the extensive altcoin market.
Novogratz explained that the vast market of altcoins will have to “prove themselves out,” as viable solutions and providers of utility, as opposed to being carbon-copy coins that generate undeserved billion-dollar market capitalizations. While Bitcoin may have reached its limit as a digital store of value, the broader altcoin market has yet to prove much in terms of usefulness. According to Novogratz,
“If you really think bitcoin is gonna win this store of value, everything else needs to be used for something.”
In April, Novogratz took aim at Litecoin in a series of tweets questioning the investment interest in LTC over Bitcoin,
“Gold has an $8.5 trillion dollar market cap. Silver is $15bn That is .17%. $BTC has a $90bn mkt cap. $ltc is $5.7bn which is 6.4% of $BTC. Silver is at least useful for industrial production. $ltc is a glorified test net for $btc. I don’t get this rally. Sell $ltc buy $btc.”
The price of Bitcoin has continued to climb throughout the weekend, trading at $7100 as of writing.
