Bitcoin Halving Impact Fades as Demand Takes Center Stage
According to reports, the Open Interest in Bitcoin is now 30 times higher than it was 11 days before the 2020 Bitcoin halving.
Michael Wu of Amber Group, the digital assets financial service firm, believes that Bitcoin has crossed bubble out of the territory for good and that Bitcoin mainstream adoption is going to lead the digital assets market to new heights.
In an interview with CNBC, Wu offered how he sees the future of the market as an industry which is only just taking off and that the fundamentals are all in place for the market to surge.
The boom of DeFi
Wu suggested that the narrative of Bitcoin being a better form of gold is the worst-case scenario for the cryptocurrency market. He added that Bitcoin is superior to gold as an inflation hedge and as a storage of wealth and institutions are starting to see that and act on it. With the boom of the decentralised finance (DeFi) ecosystem, there is now tens of billions of dollars are locked in the DeFi system managed by smart contracts rather than central institutions.
“So now you have things coming out of the left and the right – new business models and new inventions in this crypto finance world. So I think the fundamentals are already here. It’s just that it will take time for people to understand them and for the market to digest them.”
Wu: Bitcoin not a bubble
The CEO of Amber Group said that he thinks that there is too much attention on the market now, with institutions, whales and retailers investing in the cryptocurrency industry to refer to the token’s rise as a bubble that will burst. He suggested that there’s validity for doubt and uncertainty from new investors or those who don’t believe in the overall stability of Bitcoin because of the absence of understanding. He said:
“In the early stage, that kind of understanding, that kind of skepticism, always comes with a lot of price volatility. However, I don’t think you can call Bitcoin a bubble anymore, because, like I mentioned earlier, you have all these institutions, all these billionaires, multi multi-billion-dollar listed companies, all these, you know, all these newcomers into crypto. They’re buying Bitcoins they’re buying crypto and there are only 21 million Bitcoins out there.”