Mohamed Aly El-Erian, the chief economic advisor at Allianz, a European financial services firm, recently told Yahoo Finance that “Crypto is not dead, and certainly the underlying technology is not dead.”
He added:
We’re going to see more widespread adoption, by both the private sector and public sector, of the blockchain technology and related technologies.
In September of 2017, when bitcoin (BTC) was trading at around $4,000, El-Erian had said the flagship cryptocurrency was overpriced as speculative investors were “assuming massive adoption, which [was] not going to happen.”
Overestimating Bitcoin (BTC) Adoption
At the time, the Egyptian-American economist had argued that a more reasonable bitcoin price would be around one-third or one-half ($1300 to $2000) of it actual trading price. Now, a year later, El-Erian still thinks bitcoin is overvalued as he noted its buy value should only be around $5,000.
Bitcoin (BTC) is currently trading at $6,392.60 according to data from CryptoCompare and its price is down nearly 70% after reaching an all-time high of nearly $20,000 in December of 2017.
While El-Erian believes bitcoin is a “disruptive” technology and that people will continue to use it as a means of peer-to-peer (P2P) “electronic cash” transfer, as intended by its creator Satoshi Nakamoto, he also noted that investors are over-optimistic about its level of adoption.
The CNN contributor remarked:
What we’re getting is the realization that adoption is not going to be as big and as quick as the proponents of crypto would like. I think it’s going to be there, it’s going to last for a long time, it’s going to play a role in the ecosystem, but it’s not going to be the currency that a lot of proponents would like it to be.
Unpredictable Bitcoin Price
Meanwhile, London Fintech Week founder, Luis Carranza, told Express UK in June, when bitcoin was trading at around $6,600, that the cryptocurrency market is highly unpredictable. He added that “$4,500 could be the bottom” for the world’s most dominant digital currency.
However, Carranza also said: “There is nothing preventing $2,500 from being the bottom” for bitcoin price. Despite the possibility of the pseudonymous cryptocurrency experiencing sharp declines in its price, the Virginia Commonwealth University graduate added that:
`Even if the [BTC] price drops to $1000 there's nothing preventing another surge to $14,000.
As covered on CryptoGlobe, experienced venture capital professional, Arianna Simpson, recently noted that she’s observed the crypto space gradually evolve “into something that commands mainstream attention.” She added that crypto-related technology was still in its early stages of development and that the bear market would “clear it out for those who plan to stay in the industry for a long time.”
