Citing the case of Facebook’s yet-to-be-launched cryptocurrency as well as Square’s and Fidelity expected crypto-related products, Singh stated that the rally was just getting started and so far it was ‘just the tip of the iceberg’.
According to Singh, the current rally in bitcoin was being driven by fundamentals. This was in contrast to the price collapse last year and the bull run in 2017:
The recent downturn last year and the upturn before that two years ago was not driven by fundamentals. It was more by hysteria and you know momentum.
Fundamentals driving the current bitcoin rally: singh
In the senior BitPay executive’s view, the current rally owes a lot to growing institutional adoption. This includes firms such as JPMorgan, Fidelity, AT&T, Facebook and Square that have either developed crypto-related products or are beginning to accept cryptocurrencies.
Telecom Giant AT&T Gains First-Mover Status by Accepting Crypto https://t.co/Kowgl3k5TW
— CCN.com (@CCNMarkets) May 24, 2019
According Singh, their involvement had demonstrated that cryptocurrencies ‘have real use cases around the world’.
Regarding Facebook’s foray into cryptocurrencies, Singh suggested that the social media giant was probably working on a peer-to-peer payments platform.
I think what they might be working on… they are trying to make probably like an international Venmo where you can send money all throughout the world using Facebook Messenger or whatever using digital currency that’s backed by the U.S. dollar.
Other tech giants will want to copy facebook
According to the BitPay executive, the move by Facebook will benefit the cryptocurrency sector significantly. This is because it will legitimize the Bitcoin space making it harder for regulators to ostracize the sector. Additionally, it will introduce cryptocurrencies to Facebook users around the world who number over two billion.
BitPay’s commercial officer also suggested that Facebook’s move might force other tech giants to enter the bitcoin space too:
It puts competitors on notice. What’s Google, Apple, Amazon, Tencent, Rakuten, Alibaba… what are they going to do now if Facebook launches a coin that gets traction around the world?
JPMorgan’s bitcoin comment brushed aside
Early last week, JPMorgan strategists wrote in a note that the price of Bitcoin had increased beyond the ‘intrinsic value’. The strategists warned that a divergence between the cryptocurrency’s intrinsic and actual value had heralded its tumble in late 2017.
Singh’s optimism that the price of Bitcoin will keep rising was however unfazed by the observation. Instead, the BitPay executive brushed it away saying the lender’s recent moves were the ‘biggest validation’ of the bitcoin space.
They just validated the whole industry by launching their own stablecoin … they are the biggest validation of this whole space I believe.