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Bitcoin makes fool’s gold out of altcoins, CEO says

By Cameron Micallef · August 13 2019
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Aleks Svetski
Bitcoin makes fool’s gold out of altcoins, CEO says

Bitcoin makes fool’s gold out of altcoins, CEO says

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By Cameron Micallef · August 13 2019
Reading:
egg
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egg
Aleks Svetski

Bitcoin will one day take over the world, while other alternate digital currencies will trend “towards zero” as the world continues to move towards digital currency, a chief executive officer has predicted.

Speaking recently on Nest Egg’s podcast, the founder and chief executive officer of Amber, Aleks Svetski, has revealed the reasons why only one crypto asset can survive, and why he expects it to be Bitcoin. 

Digital scarcity

Scarcity, or short supply of an asset, causes the price of a commodity to increase, according to Mr Svetski.

He said that digital scarcity, by its definition, can only happen once. 

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Due to Bitcoin’s already limited supply, the CEO said that this phenomenon has already happened.

With it coded in the core source code of Bitcoin that there will only be 21 million bitcoins produced, Mr Svetski said Bitcoin is “its own economic system with its own economic unit that is un-inflatable, un-confiscatable and it’s uncompromisable”.

He went on to compare Bitcoin to gold, citing its similar characteristics, and said that the digital asset could be worth “literally anything” by design.

“The Australian dollar, for example, has a market capitalisation, m1, m2, of $3.5 trillion that is designed for 25 million people,” he offered. 

Continuing, Mr Svetski said that in the alternative, “Bitcoin is designed for 7 billion people, with a current market capitalisation of $200 billion”. 

‘Alt coins are trending towards zero’

Despite the applications and popularity of some alt coins, Amber’s CEO reiterated the idea of digital scarcity as a reason why others are simply not worth it.

“The other cryptos are effectively fool’s gold,” he stated. 

Considering digital scarcity to have already happened, Mr Svetski noted “Bitcoin’s adoption today is undeniable”.

He called it “a $240 billion savings account”, where adoption occurs by “buy, hold and save”. 

The CEO went on to forecast that “great” innovations will be built off the back of Bitcoin, which he said will “further reinforce Bitcoin’s network effect”. 

According to him, this will result in further reductions in the liquidity capability of alternative digital currencies. 

“Every single alt coin is trending towards zero against Bitcoin on a long enough time frame,” he predicted.

In contrast to the remarks by the CEO, CMC Markets’ Michael McCarthy has previously gone on the record to say that the crypto space is set for tremendous changes and has considered that Bitcoin will fall to alternative currencies Ethereum and Ripple.

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