Bitcoin (BTC) topped $10,000 in February before dropping below $4,000 last month as investors and the financial markets reacted to the coronavirus pandemic. Despite the plunge and ongoing macro economic turmoil, billionaire investor Tim Draper remains bullish on the leading cryptocurrency.
In an interview with Chinese news outlet Bitpush, Draper, who runs venture capital firm Draper Fisher Jurvetson, warns that prolonged isolation due to widespread lockdowns threatens to aggravate the disease-induced financial crisis. He also shares his thoughts on the projected V-shaped economic recovery, which would see the United States making a quick rebound from its current slump.
“If the government continues to keep people isolated at home for another two weeks, the economic V-shaped trend that everyone discusses will not happen, and the recession may be worse than the virus at that time.”
For investors navigating the volatile equities markets, Draper believes it’s not the best time to buy US stocks. But that’s not his position on Bitcoin. The billionaire says he stands behind his long-standing prediction that the king coin is on track to reach $250,000 by 2022 or early 2023, despite the black swan pandemic that crashed the markets.
While crypto users anticipate the Bitcoin halving in May to limit the supply of new BTC and drive a bull run, Draper says the event is just half of the story.
“If the US dollar depreciates because of large-scale printing of money in the United States, and people know that gold is no longer worth buying, then Bitcoin is a safe haven.”
The crypto investor likewise sees a silver lining in the current situation.
During a bull market, Draper argues, people are not typically open to change, but the current pandemic is driving a shift in habits, as people look for better, cheaper and faster alternatives in banking, healthcare and other industries.
He believes the crisis could trigger the adoption of new technologies such as blockchain, smart contracts and Bitcoin.
“Once people realize that the government is saving the market by devaluing fiat currencies, they will begin to accept the use of Bitcoin. People will realize that Bitcoin is more open, transparent, smoother, more valuable and more replaceable than the US dollar, peso, naira or drachma.”
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