Deutsche Bank analyst Marion Laboure says Bitcoin is here to stay as digital gold

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Bitcoin recently received some crazy, and not-so-crazy, predictions from analysts. The growth of digital currency this year has led some analysts to predict that the digital asset has not yet finished growing. One thing has remained constant most of the time through the predictions. The value of bitcoin cannot be denied. Bitcoin made its mark in the financial markets as a store of value and has been touted as digital gold ever since the asset started gaining notoriety.

Due to its high volatility, there is no way to determine where the value of bitcoin will be at any given time. But its volatility has been a major driver of the coin’s adoption. Its viability as a currency, rather than simply being an investment vehicle, also contributes to the value of assets. But analyst Marion Laboure does not see cryptocurrency as a viable medium of daily exchange.

Related reading | Jim Cramer to crypto investors: I beg you to sell

Digital gold and silver

Although Labore does not view the digital asset as a reliable means of payment, the analyst believes it could be digital gold. For Labore, the limited supply of bitcoin means that it cannot be used effectively as a means of payment. With 89% of the 21 million BTC supply already in circulation and less than 10% of the world’s population owning the asset, there is simply not enough for it to be considered a means of payment in the world.

Trading BTC Prices Above $ 42,000 | Source: BTCUSD on TradingView.com

However, the same reasons that Laboure cites for bitcoin not being a good form of payment have played into the reasons analysts call it digital gold. Its deflationary nature makes it a hedge against inflation, which has increased in recent years. Since bitcoin has a limited supply, it is impossible to create more and over time the asset will become more scarce. As such, the value will increase as supply decreases relative to demand.

People have always looked for assets that were not controlled by governments. Gold has played this role for centuries. And yes, I could potentially see Bitcoin becoming the digital gold of the 21st century.

Ethereum has also entered the analysts’ radar, which Laboure has called digital money. According to Laboure, if Bitcoin is sometimes referred to as digital gold, then Etheruem would be digital money.

Bitcoin needs regulation

Laboure pointed out that the lack of regulation does not necessarily promote the growth of cryptocurrencies. This is because while early investors may benefit from this lack of regulation, investors or companies (institutions) that may wish to enter the market may not because of the regulations that they must adhere to. Completely prohibit these investors from bringing their money to the market.

Related reading | Falling Bitcoin Prices Sparks Surge in Interest as Number of Small Investors Grows

Additionally, the analyst also explained that bitcoin’s carbon footprint is a concern for the asset. While steps are being taken to make cryptocurrencies greener, it takes time. And as the market waits for these upgrades, the asset’s environmental impacts increased. It also prevents investors and institutions that genuinely care about global warming from investing in cryptocurrencies.

Once the environmental pollution problem is resolved, more investors are expected to enter the market. One of them is Tesla, which had suspended bitcoin payments for its automobiles, citing the environmental impact of bitcoin mining as the reason. But said BTC payments would be reinstated again after the digital asset could boast of using at least 50% renewable energy for its mining operations.

Featured image from Capital.com, chart from TradingView.com

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