Ever since the arrival of Bitcoin, many people have predicted that “soon” all of the cryptocurrencies will crash. The trends in cryptocurrencies have been compared to global events such as tulipmania, the 1929 stock market crash and the dotcom bubble. However, even after the recent fall in crypto prices, the industry continues to attract new investors.
This time, Yoni Assia, CEO of trading platform eToro, has picked up the dotcom bubble analogy. However, instead of speaking against the technology, Assia has chosen a different path. In an interview with Bloomberg, Assia said that 90% of the crypto startups will “end as nothing” but he believes that these startups have a bigger platform than the ones in the dotcom bubble.
From 1995 to 2000, people invested heavily in “.com” companies which were often formed without proper business models. Nowadays, people can come up with new ideas that can be recorded on a whitepaper for the entire world to read. Since these inventions are creative, millionaires invest in initial coin offerings (ICOs). Even if 1,000 of them contribute $10,000 individually, the entire project can raise $10 million within a short amount of time. For instance, web browser Brave raised $35 million in under 30 seconds last year.
Assia further explained that blockchain appears to be as transformative as the internet was. “Tesla made 2,000%, Facebook made 1,000%, Google made 1,000%. This is the same thing but earlier in the cycle,” said Assia.
After introducing iPods, iBook and improving the Mac OS from 2001 to 2005, Apple’s stock started increasing gradually. Assia stated that currently investing in crypto is a decision people have to make on their own.
“My long-term view is selling crypto now is like selling Apple in 2001,” said Assia, “You do it if you have to do it, you don’t do it if you don’t have to do it”.
Assia concluded by pointing out that once someone learns about blockchain technology, they want the entire world to use it. Rightfully so, blockchain provides transparency and decentralization, which when implemented in medical and engineering industries and electoral systems, can solve many problems. Blockchain advocates are working day and night to improve this technology to turn these ideas into reality somewhere in the near future. Until then, we have to wait and see which crypto companies will be worth the investment.
Featured Image from Shutterstock