The price of Bitcoin (BTC) has increased dramatically in the past few days and weeks, recently exceeding $ 40,000. An asset largely unrelated to government authority, Bitcoin is a hedge against global uncertainty, according to venture capitalist and billionaire Chamath Palihapitiya.
Citing a possible five or ten year time horizon, Palihapitiya said he believed Bitcoin is likely to reach $ 200,000 at some point. “The reason is because, every time you see all of this happening, it just reminds you that, wow, our leaders are not as reliable and reliable as they used to be,” he told CNBC in an interview on Thursday . He added:
“So to be sure, we really need to have some kind of, you know, insurance that we can keep under our pillow that gives us some access to an uncorrelated hedge.”
Since the pandemic hit the world in 2020, governments around the world have taken several measures to combat its economic impact. The United States, in particular, printed and spent huge amounts of dollars.
Borderless and managed by the people, Bitcoin allows holders to control their funds on their own – no centralized authority is required. In addition, in October 2020, Fidelity released a report showing Bitcoin’s lack of price correlation with other markets, such as gold and stocks.
“Eventually, it’s going to make the transition to something much more important, but for now, you’re just getting all these data points that prove it,” said Palihapitiya of Bitcoin, adding:
“The fabric of society is worn out and until we figure out how to make it better, it’s time to just have some stupid insurance on the side, and everyone is running. It is simply an incredible thing. I could never have imagined this. “
Crypto has seen a remarkable amount of adoption since the beginning of 2020, including major players who are gaining interest in BTC. Some influential financial figures, however, like Kevin O’Leary of Shark Tank, still remain skeptical of Bitcoin, citing regulation as a potential problem.
The U.S. Commodity Futures Trading Commission previously classified Bitcoin as a commodity, although recent actions show an increase in regulatory vigilance in the cryptographic space, partially evident in a government proposal that limits self-custody digital asset portfolios.