Adam White, vice president of Coinbase Inc., tried to offer some perspective amidst the numerous claims about bitcoin being a bubble amidst the cryptocurrency breaking the $10,000 price point.
White told Emily Chang of Bloomberg that he disputes the contention that bitcoin is a bubble, although he acknowledged that the price is an easy metric for people to attack. He said the price is only one important quantitative indicator of bitcoin’s success.
Coinbase has also looked at bitcoin’s utility, including how many people are using it and the daily transactional volume, White said.
“That happens separate from the price, and we’re also seeing great growth in it,” he said.
Chang noted that the number of Coinbase’s accounts have tripled to 13 million in the last year. White said there were 5 million retail customers at the beginning of the year. “Coinbase.com is the easiest way to get started buying and selling with a little bit of digital currency,” he said. Coinbase also reports its total trading volume, White added. More than $50 billion has traded on the platform. Average everyday users are adopting the technology.
Questioned about bitcoin’s volatility, White said the volatility will not last.
“We are in the very early innings in the introduction of this technology right now,” he said.
White said he co-authored a paper with Chris Burniske, Chris Burniske, a partner at cryptocurrency-focused venture capital firm Placeholder and former cryptocurrency investment lead at ARK Investment, and examined the 2016 volatility of bitcoin compared to other classes of assets.
“What we found was that bitcoin was as volatile as both oil and less volatile than Twitter stock in the year 2016,” he said. “We’re seeing volatility now. That’s not a bad thing. More liquid markets with institutional capital entering the space is ultimately going to decrease that volatility and make digital currencies like bitcoin a really viable financial instrument for the world.”
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