Former Director of the National Economic Council of the United States, Lawrence Summers stated cryptocurrencies will feature as the ‘Digital Gold’ and it will remain of prominent importance for the economy.
Summer’s Digital Gold Theory
Despite Bitcoin (BTC) selling short, Lawrence Summers commented positively upon the entire crypto industry, stating it will be an alternative asset for gold Bloomberg Television’s “Wall Street Week” with David Westin.
Summers further put forward that the whole world considers gold as a primary investment and asset for a long time. Cryptocurrency is now widely being accepted by many and will furthermore be accepted by the whole world soon. People are looking at cryptocurrency as a better and safe investment to hold in. Also, he portrays crypto is now here and it will furthermore stay towards and for the future. All this makes cryptocurrency to get the name ‘digital gold’.
One of the aspects to consider is the overall quantity and value of cryptocurrency. Summers states if only cryptocurrency could amount to even just one-third that of gold, crypto will become a standard and substantial element throughout time.
Crypto analyst,Yassine Elmandjra of Cathie Wood’s Ark Investment Management LLC also stated Bitcoin will reach the market cap of gold soon in future. At present the market cap of Bitcoin stands $700 billion to that of gold’s $10 trillion.
Economic Role of Cryptocurrencies
Amidst all the optimistic views, Summers at the end depicts cryptocurrency could not be taken into account for the complete economy as it may never tend to become the major means of payments for any kind of retail.
Summers himself, one of the board members of Square Inc, opens up the company revenues and returns with the sales tripled in the first quarter owing to their dedicated bitcoin purchases through their Cash App.
Even cryptocurrency skeptics like the Nobel laureate Paul Krugman states in some form cryptocurrencies will thrive to be an alternative to gold.
All could be concluded that cryptocurrencies could actually be one of ‘the currencies’ and it cannot become ‘the only currency’ futuristically.
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