With impressive growth in recent months and an unstoppable institutional appetite, Citi GPS executives believe that Bitcoin could steal the top spot as the global currency for international trade.
The month of March started off on the right foot for Bitcoin (BTC), The cryptocurrency market leader.
Bitcoin, in addition to recovering about 8% of its value on March 1, is also gaining ground among the world's financial leaders. Recently, executives from Citi GPS, the innovation and global challenges research division of the multinational financial services company Citigroup, published a report called “Bitcoin at the tipping point”, in which they predict the level of importance that this cryptocurrency can reach in the future.
According to the report, Bitcoin is in the «turning point of their existence», and is very close to moving from being seen as a simple cryptocurrency to becoming the “currency of choice for international trade”Citi GPS executives base their predictions on the growing institutional demand for cryptocurrency from high-profile companies, which have increased the value of this cryptocurrency in a way unprecedented in history. Also, the establishment of new frameworks and favorable regulatory environments for this industry provide security to investors, who are encouraged to enter this decentralized financial ecosystem every day.
In 2021 alone, Bitcoin has grown by more than 60%, going from being worth $29.000 USD at the beginning of January, to more than $49.200 USD At the time of this writing, BTC's value even hit $58.000 USD in February, and several analysts are pointing out that another bullish rally is about to occur, which could push its price above this level, to mark new highs in its history.
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Bitcoin, the “North Star” of blockchain
The technological and financial innovation that Bitcoin represents, leads Citi GPS to call this cryptocurrency the «North Star» of technology blockchain; the underlying technology that was born with Bitcoin to support the entire complex decentralized monetary and financial system that is this cryptocurrency.
It is precisely this digital, technological and financial innovation that the entity's executives believe may evolve significantly in the future, making Bitcoin the preferred currency to facilitate future international transactions.
The Evolution of Bitcoin by Citi GPS
As analysts put it, Bitcoin has become an inspiration that has given rise to a new form of global digital economy; although back in 2014, when the entity made its first foray into Bitcoin, it was still seen as a system that was “too risky and volatile.” When the entity published its first report on Bitcoin, the cryptocurrency was barely five years old, and its market capitalization was approximately $6.200 billion. Today, 7 years later, Bitcoin has a market value of more than $920.000 billion, a growth of more than 14.800% in this time.
Mass adoption
On the other hand, institutional interest and demand for Bitcoin is something relatively new, which began to be seen significantly in mid-2020. By 2014, there was very little Bitcoin activity among institutional investors. However, Citi GPS explains that due to the disruptive innovation that Bitcoin represents, the time it took for this product to be widely used by global clients was quite short, and decreased dramatically compared to other products. To date, the frenzy that this cryptocurrency has aroused at the individual and corporate level is notable, with more than 100 million users and with high-profile companies announcing investments, quite frequently, of several billion dollars in this cryptocurrency.
Citi GPS executives point out that this level of mass adoption of Bitcoin, which took just a few years, had not been seen in other innovative products; such as the telephone, which took 50 years to reach 50 million customers, and the television, which took 22 years to reach this goal.
Investment and performance
Another point analyzed in the report presented by Citi analysts and executives is the great leap that Bitcoin has made in recent years, going from being an asset focused on retail commerce and payments, to becoming a coveted investment asset of great current and future value.
“In the search for yield and alternative assets, investors are drawn to Bitcoin’s inflation-hedging properties and it is recognized as a source of ‘digital gold’ due to its finite supply.”
International Commerce
The entity highlights that Bitcoin has become an asset suitable for investment, and that this evolution can continue over the years. Thus, within another 7 years or so, Bitcoin can be seen as the currency of choice for international trade.
As the report explains, Bitcoin's valuable properties, such as decentralization, security, speed, traceability, transparency and reliability offered by its blockchain, make this cryptocurrency an ideal form of money for making global payments, potentially cheaper and safer, with worldwide reach and above all, with absolute neutrality and without censorship, since no government or central entity dominates or controls it.
At the end of 2020, Citibank manager, Tom Fitzpatrick, he pointed that the cryptocurrency can reach $300.000 USD per unit by December of this year, because it is a scarce commodity that can be considered the new “gold of the XNUMXst century.”
Michael saylor, CEO of MicroStrategy, the largest institutional investor in Bitcoin with over 90.000 BTC in its possession, recently highlighted that this cryptocurrency has outperformed gold by more than 100 times in the last decade, and that the next generation “witness the complete digital transformation of gold into bitcoin and the demonetization of the precious metals asset class”.
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