Bitcoin (BTC) attracted the attention of institutional investors and the mainstream, as well as individual investors, with the rally that it started at the end of last year. The coin more than tripled in value between December 16, 2020, when it crossed $20,000, and April 14, when it hit an all-time high of $64,863, according to CoinMarketCap data.
However, Bitcoin is not attracting attention only because of its rapid value increase. In an environment where money printing activities accelerate and inflation escalates due to the coronavirus epidemic, Bitcoin is seen as a hedge against inflation and a store of value that will replace gold as “digital gold”.
Lawrence Summers, former chief economist of the World Bank and former US Secretary of the Treasury, Interview on Bloomberg’s Wall Street Week program on May 22 He explained why he thinks Bitcoin will be permanent. Stating that people have a desire to hold an asset that feels separate from the daily functioning of the state, Summers said that this asset has been gold for a long time.
“I think there is a chance that crypto will become the agreed-upon format for those who seek security and want to hide their wealth. So I predict that crypto will endure, possibly even as a form of digital gold.”
Saying that he has doubts about whether Bitcoin is the harbinger of a kind of “libertarian paradise” where it will be used for daily payments, Summers still thinks that crypto money will be an important part of commerce on the internet.