Deutsche Bank issued a report stating that Bitcoin is too important to be ignored, and pointed out that in terms of total circulation value, Bitcoin has now become the third largest currency. In addition, the bank stated that governments and central banks all know that cryptocurrencies will continue to exist and are expected to start regulating the industry this year.
Bitcoin is too important to ignore
Deutsche Bank Research published a report last week titled: “Bitcoin: Can the Tinker Bell Effect Be a Self-fulfilling Prophecy?” It is the third part of “The Future of Payments: Series 2.” The report’s author and research analyst Dr. Marion Laboure wrote:
Bitcoin has a market value of $1 trillion, so it is too important to ignore. As long as asset managers and companies continue to enter the market, Bitcoin prices may continue to rise.
At the time of writing, according to data from markets.Bitcoin.com, the price of Bitcoin is $57,455 and the market value of cryptocurrencies is approximately $1.07 trillion.
The report also discusses Bitcoin as a commodity, currency, and stock. The report stated that “Bitcoin trading and tradability are still limited.” The report stated that the cryptocurrency’s “market capitalization ranks among the top ten in terms of currencies and stocks.” Comparing Bitcoin with fiat currencies, the report stated Introduced in detail:
In terms of the total currency in circulation, Bitcoin is the third largest Bitcoin in the world after the U.S. dollar and the Euro.
The report continued: “This is mainly due to the recent substantial increase in the value of Bitcoin. At the beginning of 2019, Bitcoin’s circulation accounted for only 3% of the U.S. dollar, but by February 2021, it soared to more than 40%. U.S. dollar circulation According to Deutsche Bank’s research, the fourth largest currency is the Japanese Yen, followed by the Indian Rupee.
Laboure asserted that “Bitcoin’s value will continue to rise and fall, depending on what people think of its value.” She explained, “This is sometimes referred to as the “tinkerbell effect”.” “This is an accepted economic term that indicates The more people believe, the more likely it is that Tinkerbell exists because the child believes in her existence based on Peter Pan’s assertion.”
In addition, Deutsche Bank analysts believe:
The central bank and the government know that cryptocurrencies will continue to exist, so they are expected to start regulating crypto assets in the second half of this year or early next year.
The Deutsche Bank report also pointed out that the central bank “is also speeding up research on its own central bank digital currency (CBDC) and launching pilot projects.”
Laboure continued to discuss the future of Bitcoin. She said that in the short term, “Bitcoin will continue to exist and its value will remain volatile.”
In the medium to long term, analysts believe that “due to the powerful influence of the network, the possibility of using cryptocurrency as a wide range of payment methods is very small.” In addition, she warned that in the long run, Bitcoin “will have to transform its potential into Results in order to maintain its value proposition”, he elaborated:
In the long run, the central bank is unlikely to give up its monopoly. As long as the government and central bank exist and have the power to supervise currency, Bitcoin (as a means of payment) will have almost no room to replace traditional currencies.
What do you think of Deutsche Bank’s view on Bitcoin? Let us know in the comments section below.
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