As cryptocurrency builds its legitimacy amongst its skeptics, many investors are beginning to draw attention to cryptos such as Bitcoin and Ethereum.
One of the frontrunners for the crypto-revolution is Michael E. Novogratz, current CEO of Galaxy Investment Partners, a cryptocurrency investment firm. The Bloomberg Galaxy Crypto Index (BGCI) tracks the performance of various cryptocurrencies such as Bitcoin, Ethereum, Monero, XRP and Litecoin.
Novogratz is a firm believer of the crypto-revolution. In 2013, he invested seven million dollars of his own money into cryptocurrency investments. In a recent interview from the Bloomberg Invest Summit, he stated that he views the crypto revolution as the “internet 3.0”. Novogratz believes cryptocurrencies will change business because of its accessibility.
Later in the interview, Novogratz stated that blockchains will one used more because they are a more effective way of organizing data. Blockchains earned popularity because of the transparency they offer.
While many continue to be skeptical, Novogratz gives the example of bringing decentralized currency to companies such as Uber. He believes that social networks will be impacted the most by decentralized currency. Satoshi Nakamoto, the creator of Bitcoin, described it as a “Peer-to-Peer Electronic Cash System” in the publication of Bitcoin’s roadmap. The philosophy of “Peer-to-Peer” remains true to Uber in which it matches up riders to drivers. According to Novogratz, businesses such as Uber are “ripe” for the introduction of a decentralized system. In this scenario, Bitcoin could be accepted as a form a payment.
Another name in the crypto revolution is Tim Draper, a venture capitalist in cryptocurrency. In 2014, Draper predicted that Bitcoin would become worth $10,000 in three years. He was proven right when Bitcoin not only surpassed the prediction, but hit close to $20,000 in late 2017. Currently, he predicts that Bitcoin will hit $250,000 by 2022.
Draper views Bitcoin as a “network effect”. He explains that Bitcoin creates connections if more and more people begin to utilize it. By itself, Bitcoin would not hold much value, but if it expands amongst groups, then it gains popularity.
Additionally, Draper says that “Blockchain technology is actually bigger than the internet”. Blockchains are public ledgers used by miners to verify transactions made with Bitcoin. According to Draper, Blockchain technology possesses the potential to ultimately transform industries that have been regulated by the government because of their sizes. This means that blockchains could transform industries such as banking, real estate, healthcare and even possibly the government itself.
Novogratz believes that blockchains will grow more in usage because they are a more effective way of organizing data.
Some of Draper’s thoughts on cryptocurrency are similar to Novogratz. Both believe that the world is heading towards building a stronger virtual economy, but there are some differences between their views on fiat currencies.
Novogratz believes that Bitcoin will not replace monetary currency, but it will become a reputable currency. However, Draper stated in an interview with Forbes that he believes cryptocurrency will replace fiat currency, or currency that is recognized by the government. Additionally, he states that he believes Bitcoin to eventually replace credit cards because of its accessibility. Small purchases, such as paying for coffee, could be done with bitcoins. The two views differ on fiat currency, but they both hope to continue to establish Bitcoin and its legitimacy even further
However, Novogratz must still convince those who are skeptical. He explains Bitcoin as “decentralized gold” and since the world is going “digital”, it would make sense to diverge into a virtual market.
Draper and Novogratz realized the momentum the digital world was gaining, so investing on that momentum allows them to keep up with expansion of cryptocurrencies. Draper believes though, that there should be a whole economy based on the virtual world. Even Novogratz admits that it is difficult to truly understand Bitcoin, but it is completely possible to fully invest in Bitcoin as it grows in popularity. Crypto bulls, such as Draper and Novogratz, are leading the charge towards cryptocurrency adoption and mainstream acceptance.