A crypto enthusiast evaluated the chances of bitcoin for survival
Currently, the digital asset industry is going through a time that is somewhat reminiscent of the dot-com collapse. Ari Paul, co-founder of cryptocurrency hedge fund BlockTower, believes that BTC has the most serious chances to survive. He also noted that in the bull market it was quite easy to ignore the problems of the crypto industry.
“High returns in DeFi? This is not an indicator of the imminent default of counterparties, but “free money”. The permanently idle Solana is seen as a cost to growth. Ethereum scaling delays and The Merge issues seem minor. Securing the bitcoin network — we will figure it out over time, ” said Paul.
The entrepreneur believes that over the past six months, the community has ceased to be naive, but still does not see the shortcomings of digital assets. According to Paul, today’s cryptocurrency exchange rate can be a good start for the next bullish trend, although with some risk.
“All cryptocurrencies are still risky for me. The industry has reached an early level of maturity with proven product suitability, working infrastructure and real value. However, most of the market leaders are likely to be replaced by new, improved versions,” suggested Paul.
He advises investing in cryptocurrencies, similar to investing in IT stocks after 2000. This means doing basic “value investing” in existing projects and exploring new solutions that could lead to bullish market sentiment.
According to Paul, BTC can be called the only independent asset in the portfolio for a period exceeding 3 years.
“Even if bitcoin fails, it’s probably not because something better will replace it. In my estimation, there is a 50% chance of Bitcoin crashing within 20 years, but its chances of surviving are much better than any other crypto asset that offers a higher but risky return on investment,” he said.
Ari Paul is confident that now the value of bitcoin has become much closer to the “fair” assessment, and this is the best period for buying BTC than ever since February last year.
“I am much more optimistic about crypto in the two year horizon than I was 9 months ago when a lot of tokens were worth 3–25 times more. However, you need to be careful with what you buy if you are trying to save capital in the long term,” he concluded.
And the founder of Galaxy Digital, Mike Novogratz, believes that BTC and ETH are close to the “bottom”, unlike the traditional assets of the American financial market.
“Ethereum should hold on to $1,000, it’s currently worth $1,200. Bitcoin is in the region of $20,000-$21,000, now it is at $23,000. Therefore, you are now much closer to the bottom of the cryptocurrency market than, say, stocks. They will fall another 15–20%,” the entrepreneur said during a conference organized by Morgan Stanley.