Ted Rogers, the president at Xapo, one of the most widely utilized bitcoin wallet platforms in the global cryptocurrency market, firmly emphasized that bitcoin is still the most sound money in the market.
Bitcoin is the Reserve Currency of Cryptocurrency Market
Over the past few months, the alternative cryptocurrency (altcoin) market has overtaken bitcoin, based on its dominance over the global market. While bitcoin remains as the most dominant cryptocurrency in the global market, it is no longer more valuable than all of the other cryptocurrencies in the market combined.
The decrease in the dominance index of bitcoin has been triggered by the rapid rise in popularity of cryptocurrencies such as Ethereum, Ripple, Bitcoin Cash, Cardano, along with digital tokens from initial coin offering (ICO) projects.
But, Rogers stated that bitcoin is still one of the only forms of sound money in the market that is currently being dominated by digital tokens and altcoins. He wrote:
“The altcoin/ICO mania of recent months is a circus of intellectual laziness, gambling and greed. Just hold to one central truth: bitcoin is the most sound money – the best money – human civilization has ever known.
Folks, I do think the ICO is important innovation, ETH has value as platform (not sure fair to call it ‘altcoin’) & we are headed for tokenized future. But ‘overvalued’ is trading at P/E of 20 instead of 15, worthless tokens with market caps of billions is Bosch and Bruegel madness. Period.”
Investors and analysts including Rogers firmly believe that bitcoin is the reserve currency of the highly volatile cryptocurrency market, as it is one of the few cryptocurrencies that is being utilized at a large and commercial scale internationally, apart from Ethereum which is processing more than 1.2 million transactions per day.
The market valuation of Ethereum can be justified, as Rogers suggested, given the value of decentralized applications launched on top of its protocol. But, the valuation of the rest of the cryptocurrencies in the market, remains questionable.
To those that claim #Ethereum does not have any commercial and successful decentralized applications, check EtherDelta, 0x, CryptoKitties, OmiseGo, and Status.
Ethereum’s market cap is one of the few I can possibly justify. Its also processing 1.2 million transactions per day.
— Joseph Young (@iamjosephyoung) January 9, 2018
What Happens With Bitcoin?
Bitcoin and other major cryptocurrencies like Ethereum, Litecoin, and Bitcoin Cash tend to move together in a similar trend while digital tokens or ICO tokens move differently. If a massive sell-off from highly overvalued ICO projects and digital asset occurs, the money will not flow into fiat currencies. Rather, it will likely flow back into bitcoin and other legitimate cryptocurrencies.
If so, when bitcoin regains dominance over the global market, its market valuation will be able to surpass the trillion dollar mark, as analysts including billionaire investor Mike Novogratz stated earlier this month.
“Bitcoin could be at $40,000 at the end of 2018. It easily could. There’s a big wave of money coming, not just here but all around the world.”