The Growth of Bitcoins Has Spread Like An Infection, Economists Claim
The economists say that the enormous splash in prices for Bitcoin from $ 900 to almost $ 20,000 last year was similar to the spread of an infectious disease.
The increase in the price of Bitcoin by 900% was due to the fact that buyers demanded a share in digital currency, supported by euphoria around the event.
Barclays Bank economists say that the growth and fall of Bitcoin closely followed the pattern of the spread of an infectious disease.
They mention that the message spread from person to person, and many were afraid that they would miss the huge profits they saw as others did.
The statement says that the population is vulnerable, most likely to catch Bitcoin fever reduced, which means that the cryptocurrency is unlikely to see such a huge increase in prices.
The economists said, “This occurs with infectious diseases when the immunity threshold is reached; for example, the point at which a sufficient portion of the population becomes immune such that there are no more secondary infections”.
Consequently, the Barclays economists’ team believes that digital currencies have passed their course and are hardly to rise much above the market capitalization of $ 780 billion – a level analogous to that reached earlier this year.
The report mentions, “Attempting to value cryptocurrencies is problematic for the world of traditional finance, as they come as a new form of asset with no intrinsic value promised by cash flow. That means their value is solely determined by what people are willing to pay for owning them”.
Barclays characterizes the requirement for bitcoin in general from speculative buyers around 2015.
As the bank said the speculative rate was probably at the end of the cycle or closer to it, due to the fact that probable new customers have become more alive to the risks of investing in the cryptocurrency.
Rockefellers choose blockchain
The richest and most famous Rockefeller family is choosing crypto currency in partnership with CoinFund to help entrepreneurs run a business based on blockchain.
Rockefeller venture capital arm Venrock will evaluate, guide and invest in a new business.
Venrock has $ 2.6 billion under management.
David Pakman, partner of Venrock said, “We wanted to cooperate with this team, which makes investments and actually helps to create a number of different crypto-economies and cryptographic projects based on tokens”.