Will Banks Die if Bitcoin Reaches $400,000?

Will Banks Die if Bitcoin Reaches $400,000?

Several experts have already claimed that the sky is the limit for Bitcoin, as in the future it will hit $400,000. In particular, such statements have been made by independent research analyst Ronnie Moas and American investor Mark Yusko.

But if the first one sees the fast-forwarding Bitcoin as the successful electronic commerce Amazon, the second one sees in Bitcoin a huge threat to banks. Yusko, who has $3.7 billion in assets under management, believes that Bitcoin will reach $400,000 in a long-term perspective, but by the time this happens, people will not need banks anymore to confirm transaction’s validity. In his opinion, transact exchanges on blockchains, including Bitcoin, will substitute the current transaction systems.

Bitcoin price will reach $400,000. Or not?

Ronnie Moas was pretty optimistic concerning the future of Bitcoin when he discussed it in the interview with CNBC. He believes that current hype over Bitcoin shooting to $20,000 is just the beginning. The storm is yet to come. Moas predicts that Bitcoin will go much higher.

“Bitcoin is already up 500 percent since I recommended it at the beginning of July, and I’m looking for another 500 percent move from here,” said the analyst.

He also considers Bitcoin to become the most valuable currency in the whole world.

“The end-game on bitcoin is that it will hit $300,000 to $400,000 in my opinion, and it will be the most valuable currency in the world,” added Moas.

Moas claimed he thinks his price target is a conservative call. However, not everyone agrees with such statements.

Vasu Menon, vice president of Wealth Management at Singapore-based bank OCBC, said that his company thinks that it is risky. "I don't see strong fundamental drivers for this bitcoin rally," said Menon.

So is Moas right?

At the time when the Bitcoin was trading for $2,600 last summer, Moas was the analyst who claimed it would hit $5,000 before the end of the year. And he was right. Today Moas is confident that cryptocurrency will turn into the most valuable currency ever existed, and he explains it by the principle of supply and demand. Admittedly, there is a limited supply of Bitcoins (21 million coins, as known). Hence the market will make sure that prices will increase for as long as people are in need of purchasing the remaining Bitcoins.

“I don’t know how much gold there is in the ground, but I know how much bitcoin there is, and in two years there will be 300 million people in the world trying to get their hands on a few million bitcoin. This mind-boggling supply and demand imbalance is what is going to drive the price higher,” Moas defended his point.

Simple math by Yusko

The American investor explains Bitcoin gold equivalence in his way.

“Take twenty million Bitcoin totals, if today’s gold is eight trillion, it will give you $400,000. And this goes without including any used cases like an exchange of currency,” said Yusko.

According to Forbes, the total amount of gold in the world may fill up 3,27 Olympic swimming pools, so this demonstrates how good the numbers may sound regarding gold. Right now, Bitcoin is eleven times more valuable than this ore, so you can imagine the worth of a pool, “filled” with virtual coins.

Say “goodbye” to banks

Cryptocurrency is indeed likely to threat banks. The founder and CEO of Morgan Creek Capital Management Yusko believes that due to technical infrastructure Bitcoin may leave banks workers without their jobs.

"It is extremely natural to expect banks to be dismissive and skeptical because this [Blockchain and the cryptocurrency Bitcoin] is a disruptive technology. This will change the supply and demand equation for banking. It is that big. I'm not surprised at all that bankers, financiers and Saudi Princes are coming out against it. This is a truly disruptive technology,” stated Yusko.