Bitcoin to Skyrocket in Value as Confidence in Financial System Declines – Cathie Wood
Cathie Wood, the CEO of ARK Invest, believes that Bitcoin will experience significant growth if people lose confidence in the current financial system.
In a recent YouTube update, Wood highlights that Bitcoin’s decentralized nature and scarce supply will attract capital looking for a superior store of value compared to what has historically been available.
Currently, the flagship crypto is fulfilling the role of a store of value. Suppose global monetary systems lose the confidence of people. In that case, there will be a shift to more cryptocurrency as a store of value.
This will cause the price of Bitcoin to skyrocket, given that only two million more coins can be minted, and the cryptocurrency will be in higher demand than ever before.
Wood notes that the asset is limited to 21 million units. Currently, the inflation rate is 1.8% per year, based on the current mining rate. In a couple of years, the inflation rate will be cut in half to less than 1% until the total supply of 21 million BTC is exhausted. With only 19 million units currently available, Bitcoin’s recent rally amid a banking crisis and general economic uncertainty proves it is succeeding as a store of value.
The limited supply of BTC is a crucial factor in its success as a store of value, as the developers, coders, and programmers who built the cryptocurrency’s mathematical metering will not change it.
Wood believes that this is why Bitcoin’s price has risen significantly in recent weeks, going from $19,000 to almost $29,000, which proves that people believe it to be a store of value.
As a result, Wood’s statements indicate that the largest cryptocurrency by market cap may become increasingly attractive to investors looking for a safe haven asset that can hedge against inflation and currency devaluation.
This is especially relevant in the event of a significant financial crisis that leads to a loss of confidence in traditional currencies, which drives demand for alternative stores of value like Bitcoin.