After the collapse of two major US banks (Silvergate and Silicon Valley Bank), trust in the monetary system has faltered. This has pushed Bitcoin’s price beyond many major resistances closing in on $30,000. However, Cathie Wood, CEO & founder of Ark Investments, thinks that this could be just the beginning. She believes that the lost confidence in the monetary system could catapult Bitcoin to new heights.
Banking crisis and dwindling trust in the US monetary system
When people realise that their money is not safe in the banks and even the FDIC cannot guarantee the $18 trillion deposits the US banks have, they will turn to Bitcoin, the only true money in the world. Bitcoin’s decentralized nature and its scarcity will be its USP. When people look for assets that can withhold their monetary value, Bitcoin has no alternative.
Many people argue that the US dollar is stable as compared to Bitcoin. But even billionaire Bill Ackman believes that the US banking crisis is going for a train wreck which could result in USD’s fall. At the same, it could topple its position as the global currency.
Cathie Wood says that people are already turning to Bitcoin as a store of value and as the global monetary systems dwindle and people lose confidence gradually, the shift to crypto will be more prominent. Considering that 90% of the Bitcoin supply has already been minted, a major adoption curve would lead to an exponential price surge.
Bitcoin also has another advantage which is halving. every four years, the Bitcoin block rewards reduce to half, which means the inflation rate continues to go down and a major rally happens. And every halving is followed by further adoption and establishes the fact that Bitcoin is here to stay. The next halving will be in 2024, which is almost the perfect timing.
Cathie Wood’s prediction
Cathie believes that Bitcoin could reach anywhere between $1 million to $5 million per coin in the next 5-10 years. It looks like a far-fetched scenario and too optimistic, but considering that Bitcoin increases a moderate 10x in the next two halvings, it is possible. This is a very conservative scenario considering the 20x jump we saw in this bull run.
Do you also think that lost confidence in the monetary system could catapult Bitcoin to new heights? And what would be your price prediction for Bitcoin in the next bull run? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.