Marion Labour, an analyst at Deutsch Bank’s research arm, said she could envision Bitcoin (BTC) playing the role of digital gold in a future that will last for centuries and largely out of government control.
Marion Labour said she could “potentially see bitcoin become the digital gold of the 21st century,” but warned investors about the volatility of the cryptoasset. According to the analyst, most BTC purchases are made for investment and speculation, not as a medium of exchange.
“Just a few additional large purchases or market entrances can significantly affect the balance of supply and demand,” Labourt said. “Bitcoin is too volatile to be a reliable store of value today. And I expect that for the foreseeable future it will remain super-volatile. “
While a Deutsche Bank analyst expressed concerns about the lack of regulation of cryptocurrencies and their potential environmental impact, she hinted that Bitcoin is likely to remain the dominant digital asset in the crypto space .
Ethereum may have more use cases in decentralized finance (DeFi) and with the rise of non-fungible tokens (NFT), but bitcoin still enjoys its “first mover advantage”.
“If Bitcoin were sometimes called ‘digital gold’, Ethereum would then be ‘digital silver’.
Analysts at Deutsch Bank previously described bitcoin as a cryptocurrency “important, suggesting that the price of the cryptoasset is likely to rise with additional asset managers and companies entering the market. In 2019, a financial institution predicted that digital currencies will replace fiat by 2030.