With digital currencies setting new milestones in terms of their cumulative market cap, the appetite for the same is also experiencing a steep hike off late. Industry website coinmerketcap.com revealed that the market for digital currencies was worth more than $300 billion on Sunday evening which surely was a first. The total market capitalisation had crossed $304,628,469,227 by 9:00 a.m. on Monday morning London time. This was mostly fuelled by Bitcoin, the most prominent cryptocurrency crossing the $9600 threshold on Monday and Ethereum also reaching record-high figures.
At the time of publishing this article, the total cryptocurrency market cap was $309 Billion in which Bitcoin had a major share of 54%. The price of Bitcoin was $9970 with a market cap of $166 Billion.
U.S. Global Investors’ CEO Frank Holmes told CNBC that with passing time people will start building up more trust and courage while dealing with cryptocurrencies. However he was not sure regarding which currency would last the test of time. ”
Holmes stated out on CNBC Monday:
“What bitcoin has done, it has woken up everybody to the power of the blockchain technology (the underlying ledger that supports bitcoin), like emails woke everyone up to the internet. At the beginning people didn’t trust the internet. So we don’t know who’s going to survive. We saw Google being surpass Yahoo – how this will evolve I don’t know,”
The future of digital currency industry has been subject to much debate amongst market experts following the rapid rise of crypto soldiers such as Bitcoin and Ethereum. JPMorgan CEO Jamie Dimon had been propagating and advocating about the risks associated digital currency investment given its unregulated nature. He even said that the investors who were “stupid” enough for joining the Bitcoin bandwagon shall surely “pay the price for it.”
There also exists people like Hans Redeker, the global head of foreign exchange strategy at Morgan Stanley who feel that digital currencies bring along their own array of benefits. Hans recently told CNBC that digital currencies can be increasingly used for framing monetary policy. “The key question you have to ask yourself is, is cryptocurrency going to be developing within the central banks’ scope or outside the central banks scope. And I think it’s going to develop inside the central banks’ scope,” he stated on CNBC Monday.
Hans feels that central banks can now take up a much more flexible monetary policy by using digital currencies. They can also run negative interest rates much more efficiently in comparison to the traditional setup. Mario Draghi, the president of European Central Bank said in October that it will take time for cryptocurrencies to bring upon the required maturity level for being deemed to be apt for regulation by the central bank. However he also added that while innovation in the field of cryptos will be embraced with open arms, the same shall be analysed critically before its implementation.
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Tarunima Ghosh Laha is a Finance Post Grad from St. Xaviers who believes Finance is more than just Balance Sheets and Ledger creation. This filmy bookworm who believes she was a sloth in past life also nourishes a penchant of owning a private zoo someday. Equipped with a laptop and online Lexicon she is all set to give finance a glamorous makeover in the form of exciting writeups with bang on info and flashy new words.