682 total views
Venture capitalist Lou Kerner says bitcoin is well on its way to replacing gold as the dominant store of value, noting that its market cap has already surpassed that of silver.
“What [bitcoin] has evolved into is a store of value,” Kerner told Bloomberg. “Today, the main store of value is gold. It’s an $8 trillion [market]. Bitcoin today is around $60 billion, so it has an opportunity to actually replace gold as the dominant store of value.”
Kerner doubled-down on his remarks from August 2018, when he predicted that BTC would supplant gold as the most trusted store of value.
Crypto Will be ‘Bigger Than the Internet’
Kerner, the founding partner of New York-based CryptoOracle, said despite the current bear market, crypto would be a far more disruptive technology than the Internet.
“The disruption from that is gonna be bigger than the disruption that we saw from the Internet,” Kerner predicted. “Bitcoin is kind of the early leader, like the Yahoo of its day. And while it’s a massive thing, it’s not the thing [right now].”
But in 20 years, BTC and crypto will be off-the-charts, Kerner claimed.
“We really believe that in 20 years, bitcoin will have created trillions of dollars in value similar to how the Internet has,” he said. “We’re at the very beginning today.”
When asked why the bitcoin price has plunged from its record high of $19,500 last December, Kerner said it’s because the market got ahead of itself due to unchecked capitalism.
Kerner said virtual currencies and blockchain would eventually prove that they are far more revolutionary than first imagined.
“There’s something called Amara’s Law, which is that the impact of all great technological changes is overestimated in the short run, but underestimated in the long run,” he said.
Basically, Kerner is saying that the true impact of crypto and blockchain won’t be known until 20 years into the future.
[Author’s note: Amara’s Law, named for futurist Roy Amara, states that we tend to overestimate the effect of a new technology in the short run and underestimate its effect in the long run.]
Lou Kerner: The Dollar ‘is a Ponzi Scheme’
When asked to elaborate on his stance that bitcoin would replace gold as a store of value, Kerner said gold has had a good run, but it’s time to step aside.
“Gold has had a 5,000-year run,” Kerner explained. “If you look at the history of currencies over time, 100% of them — until 400 years ago — went to zero. And the truth is, if you think about the dollar, it’s a Ponzi scheme. And that’s fine, because this is how governments work.”
Nobody thinks we’re ever going to pay back the debt that we have. We’re never gonna pay back $20 trillion-plus dollars of debt.
The only way you’re going to maintain your purchasing power — the only thing that has held up over time has been gold. That’s how you store your value. Over time, all currencies degrade. And eventually, they all go to zero.
So $8 trillion is stored in gold. Silver is the second-biggest store of value, at $50 billion. Bitcoin is at $60 billion, so it’s really kind of taken over second place from silver as a store of value.
Skeptics: Bitcoin is Not a Store of Value
Meanwhile, skeptics like financial analyst Gary Shilling say bitcoin is “a grand Ponzi scheme,” and that’s why his investment firm is shorting it.
Shilling said bitcoin fails as a currency because it lacks three fundamental requirements of a legitimate currency:
- It’s not a store of value.
- It’s not a medium of exchange.
- It’s not universally accepted.
“A currency has to have a store of value,” Shilling explained. “With the volatility in bitcoin prices, I don’t think it has a store of value.”
In contrast, tech billionaires like Twitter CEO Jack Dorsey, PayPal co-founder Peter Thiel, and tech venture capitalist Tim Draper are confident that bitcoin will ultimately displace all other currencies.
As CCN reported, Dorsey — the CEO of Square — said he believes bitcoin could become the world’s leading currency within the next decade.
“The world ultimately will have a single currency, the Internet will have a single currency,” Dorsey said. “I personally believe that it will be bitcoin.”
Featured Image from Shutterstock
Blockcast.cc does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor can this article be considered as investment advice or recommendations. Every investment and trading move involves risk, you should conduct your own research when making a decision.