Making Sense of Ethereum’s Vitalik Buterin and Binance’s CZ Crypto Market Cap being $200 Trillion Comments
Will Crypto’s Market Cap Hit 200 Trillion?
Despite the doom and gloom dominating the current cryptocurrency markets, many of the top experts in the field remain bullish on the future of the crypto space. In particular, this month has yielded a treasure trove of conflicting comments top professionals in the industry. Vitalik Buterin, the co-creator of popular crypto platform Ethereum, kicked off the massive debate on the future of the currency when he said on the 8th of September that it would be “unrealistic” to expect that the cryptocurrency markets to increase one-thousand-fold to hit USD $200 trillion.
Buterin brings up a particularly persuasive point. As he elaborates, the peak public interest in cryptocurrency happened in late 2017, when the price of Bitcoin reached an all-time-high at over USD $20,000 per coin. As a result, it is hard to believe that the current markets will swell in valuation to an unprecedented 200 trillion.
But the debate rages on regarding the bullish prediction, which has been repeated by experts all over the community. Some analysts argue that Buterin’s original statement was unfairly misinterpreted by the media, and that his analysis was not nearly as foreboding and negative as some people interpret it to be.
Additionally, opinions vary on the extent to which the markets might or might not grow in coming years. While USD $200 trillion would be a ridiculous 70% of the wealth around the globe, the crypto markets have seen growth to such an extent in the past.
Buterin was not trying to say that the markets would not increase in interest or application at a rate of 1,000 times. Instead, his statement was relatively simple. Buterin argues that, while specific sectors in the crypto community such as decentralized applications (DApps) or Initial Coin Offerings (ICOs) could easily see unprecedented increase in valuation in the coming years, it is incredibly unlikely that the entire market cap will increase by these same margins.
The co-founder of Ethereum even commented on the mischaracterization, pointing out on a social media blast that he “never said” anything about “no room for growth,” the widely-used pseudo-quote that followed his statement within the mass media of the cryptocurrency community. Rather, Buterin stressed that he believes that it is unrealistic to expect that 70% of the overall global wealth will be concentrated in crypto in the coming years.
As an alternative to what he calls an unrealistic return, Vitalik believes that the community should focus on working to make DApps and blockchain use cases more commonplace in the real world. This makes sense, given that most people in the world are already aware of what cryptocurrencies are. The room for growth in overall market capitalization seems to be relatively small, even if the outlook for decentralized applications and unique blockchain uses continues to become more attractive.
Binance CEO Stands Behind 1,000x Prediction
Another major force in the cryptocurrency community has come out in favor of the incredibly bullish prediction. Changpeng Zhao is the CEO of Binance, the biggest crypto exchange in the world. He outlined in an official statement that he believes the thousand-fold increase to be to be “absolutely possible.” Specifically, he outlined his belief that the USD $200 trillion prediction only seems impossibly large if someone is looking at it under the lens of the traditional financial sector.
Instead, CZ insisted that the crypto markets are so unlike the traditional system that it is impossible to compare growth in that system’s terms. According to Zhao, reaching the market cap for the United States Dollar is just one potential way that the cryptocurrency markets could approach an increase of over 1000x. When he combines the hundreds of new use-cases of the currencies currently on the market and in production, Zhao is more than confident that the crypto markets will one day hit a new high and multiply by 1000 times.
One important piece of the debate that Zhao touches on is the wide breadth of use-cases of Bitcoin and blockchain technology. For years, experts have been saying that the biggest thing to come from Bitcoin is not the coin itself, but the distributed ledger technology behind it, the blockchain. In the past few years, the crypto space has seen the explosive growth of institutional interest in computing applications for blockchain technology.
While Buterin might be right on the infeasibility of expanding mass adoption enough to reach that coveted USD $200 trillion market valuation, he does seem to underestimate just how much the underlying technology of the blockchain might be worth to key institutional players. As cloud computing and blockchain-based protocols become more commonplace in the global marketplace, it is not improbable that the industry will swell to surprising valuation.
Mike Novogratz Predicts Institutional Interest Spike
Respected cryptocurrency expert Mike Novogratz has continued his bullish prediction history, standing by his claim that the crypto markets are going to continue to expand indefinitely. He writes that, while the infamous internet bubble was isolated to the United States, crypto is “a global revolution.” Because of this, the analyst predicts that big banks will continue to become more interested in pouring money into the evolving new cryptocurrency markets.
Novogratz did not necessarily go for the massive prediction of $200 trillion, but he also did not rebuff the optimism shared by some of his peers. Instead, he predicted a respectable $20 trillion valuation for the crypto markets in coming years. A big reason for this bullish outlook, he outlines, is that the institutional money will soon come flooding in. Novogratz believes that once the first major institutional investor, a market leader, gets involved in the industry, others will follow.
Eventually, Novogratz is convinced that the institutions which now drive the financial markets in the traditional sector globally will be the driving force behind a global cryptocurrency revolution. And with the international and massive nature of the industry, it would be surprising if the total market valuation did not skyrocket in the next few years.
The community still remains relatively divided on the USD $200 trillion market cap prediction. Still, though, even the naysayers are serious believers in the power of blockchain technology, and the role that the sector will likely play in years to come.