Riccardo Spagni Says Bitcoin Is Trying To Find Its Price
Bitcoin has been in a bear trend since the end of 2017 when it reached $20,000 and several virtual currencies were reaching their all-time highs. However, since that moment, Bitcoin (BTC) couldn’t recover these prices. Indeed, the popular virtual currency reached $3,500 a few days ago.
Riccardo Spagni, the lead developer of the privacy-focused coin Monero (XMR); talked about the current bear market during an interview with Tech Central. He has also compared this downtrend with similar downtrends in the past.
The first thing he said is that the current bear market is the fifth he experiences in the cryptocurrency market. Additionally, he mentioned that it is not surprising to him anymore but to individuals that entered the market after 2013 will find this as a difficult time.
Additionally, he said that investors that witnessed a bear market for the fifth time are already not so worried, and they see on it a specific trend. Nevertheless, this trend usually happens not only to virtual currencies but also to the stock market and other assets. Every single time that a bear market takes place, a new bull run starts allowing the asset to reach new highs.
In addition to it, he said that Bitcoin is still trying to figure out its price on the market. He has also said that we are still several decades away from the block reward dropping down to an insignificant value for the price to be higher. At this time, fees should be higher than the block reward.
Bitcoin still has a high inflation rate compared to other currencies for it to have a stable price, and this is why it is also a problem for the market to understand which is the price of the popular virtual currency.
On the matter, Riccardo Spagni commented:
“So, you’ve got a high rate of inflation, you’ve got this massive volatility because there’s irrational exuberance and everyone thinks they’re getting rich and so because of that, you’re going to have highs and lows and the swings are going to be extreme.”
Furthermore, Spagni mentioned that Bitcoin’s price discovery could take between 10 to 20 years to happen. However, he marked that the price will be much higher than what it currently is since inflation would drop down and there will be more individuals using it than now.
Monero is the 11th largest virtual currency with a market capitalization of $990 million. Each XRM can be purchased for $59. Bitcoin remains the largest virtual currency in the market with a price of $4,165 and a market capitalization of $72.5 billion.