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Pantera CIO Joey Krug Thinks Bitcoin Has Bottomed, Scalability Is Key

Bitcoin as an investment tool has been an interesting subject since its beginnings. While the original purpose of Bitcoin was to be a peer to peer decentralized cash system, an investment market quickly grew around it, and now is the predominant function that people associates with this crypto asset. But there are people that still think that bitcoin and all the cryptocurrency market is still in its infant stages and it needs to mature to reach its true potential. Joey Krug, CIO of Pantera Capital, shares this kind of thought.
In an interview with Bloomberg, Joey Krug expressed his thoughts about the price and the stance of the market when it comes to bitcoin and cryptocurrencies. For him, the price of bitcoin has bottomed out this year and there are two things that are slowing down the growth of cryptocurrencies in the market: First is the need of scaling and second is the sheer difficulty of putting fist money into cryptocurrencies.
Joey Krug said that cryptocurrencies are still in incumbent stages, and he thinks that there are a myriad of applications there, but users have not flocked in due to several factors: first is the relative slowness of the network and the need for scaling. He compared the state of the bitcoin network with the internet before dial-up: a slow and costly mass of interconnected nodes that can work but are not so efficient doing it. But according to him, the evolution will be faster because for internet to scale, copper wires had to be installed physically; cryptocurrencies can scale with software advancements.
To scale, bitcoin must be able to go at least with the same level of transactions that credit monsters like Visa or Mastercard have at the moment, and be able to handle more than its current transaction output. He is unsure if this will ever happen to bitcoin, but he is sure that in the long run, cryptocurrencies will be able to scale that way.
Also, there is the difficulty of transforming fiat into crypto and the high fees that are being charged for it. Today, Coinbase charges a most a 5% for every credit card purchase of crypto, a high percentage to achieve adoption. But with the emergence of new options like Bakkt and also the announcement of Fidelity investments getting into the cryptocurrency business, the gates will be open to more competition and these fees will have to go down.

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