A Swiss researcher called Thomas Huber has recently proposed that Bitcoin is still very undervalued because the investors might be missing its “value proposition”. Huber is a member of the Chair of Entrepreneurial Risks at the Department of Management, Technology and Economics at ETH Zurich University.
The researcher made claims that there are essential benefits that most people are simply not taking into account when they consider the price of the token. According to him, Bitcoin is the only viable candidate for a way to store value in a way that is non-sovereign for any country.
1) Bitcoin is currently the only viable candidate for a non-sovereign store of value, but it seems that it's still massively underpriced. This under-appreciation of bitcoin might be the result of how investors evaluate cryptocurrencies.
— Tobias A Huber (@TobiasAHuber) July 26, 2018
Bitcoin Underpriced
The main problem that Huber sees is that the investors are not taking into account that Bitcoin is the most secure, decentralized and censorship-resistant option and that this token can be the reinvention of money. This would take the price of Bitcoin up to the sky but it does not seem to be happening at the moment.
Even as the public opinion on Bitcoin is starting to change and some people are starting to believe in the currency, which lead to a surge in the price of almost $2,000 in a couple of days, is prompting a new bull market that might drive the prices upwards. However, there are still some drawbacks.
For example, regulators have recently declined to allow Bitcoin exchange-traded funds, ETFs, by the second time this week. While there are still some other candidates trying to make Bitcoin ETFs, the regulatory agencies are not very positive on the subject, or at least that is what it looks at the moment.
The main reason for the undervaluation of Bitcoin, according to Huber, is that many investors of Wall Street see Bitcoin as an asymmetric bet or a call option, not as the revolution that it actually is. This results in a massive undervaluation that simply ignores how Bitcoin is the store of value of the future.
Other tokens Will Not Be Like Bitcoin
Huber might be excited about Bitcoin, but he does not seem so much about Ethereum and other cryptocurrencies. According to him, these alternative cryptocurrencies will likely not see such a key money influx.
The explanation, according to Huber, is that given the open source nature the capture of value will not happen at the platform level. He believes that the value of ETH is already priced, while most of the value of Bitcoin will likely accrue to the unique network effects that Bitcoin will have as the winning monetary protocol.
Despite criticism that Bitcoin’s technology is not very good and that alternatives like Ethereum are better, the unique selling point of Bitcoin is that it remits money unfailingly. Just that.
One of the main arguments that Huber uses to defend Bitcoin is that a monetary protocol needs to be secure, decentralized and resistant to censorship. This means that a low rate of innovation is more a feature than a bug. According to him, monetary “innovation”, as the policies of central banks illustrate, are mainly a debasement of money.
