Marion Laboure – Macro Strategist at Deutsche Bank – believes bitcoin has the potential to become the “digital gold” of this century. However, she expects the cryptocurrency’s price to be “ultra-volatile” in the next few years.
Laboure also praised Ethereum’s use cases, labeling the asset as the “digital silver.”
BTC – The Gold of The Future
According to Marion Laboure – Analyst and Macro Strategist at Deutsche Bank – Bitcoin possesses all the necessary qualities to step in when the world suffers from rising inflation, doubt, and fear due to the COVID-19 pandemic and the governments’ actions. As its supply is fixed (there will be no more than 21 million BTCs in existence), she stated that the asset could be a successful choice as a protection against the growing inflation.
The increased control by authorities over the population could be another factor that would make bitcoin attractive to the people. Laboure reminded that in such cases, throughout the years, humankind has turned towards assets that were not under the governments’ jurisdiction, such as gold. With that said, the executive believes BTC could become the “21st-century digital gold.”
It is worth noting that Deutsche Bank had a different opinion on the matter in the recent past. Last year, a report from the German multinational investment bank stated that bitcoin’s high volatility is an obstacle that makes the digital asset not a “reliable source of value.”
According to Laboure, though, BTC’s enhanced fluctuations would not last forever. The asset remains “risky” as of the moment and could be “ultra-volatile in the foreseeable future” but just like gold, which has also experienced this issue, BTC would eventually overcome it.
While bitcoin is the pioneer in the crypto space and the largest digital asset by market capitalization, Laboure also praised Ethereum’s merits. She pointed out that it is more than a cryptocurrency as it offers many applications and use cases such as decentralized finance (DeFi) projects.
In fact, most of the trendy non-fungible tokens (NFTs) are part of the Ethereum blockchain and she noted ETH could be the “digital silver.”
Laboure concluded that no other cryptocurrency would become stronger than Bitcoin or Ethereum in the next five years.
Deutsche Bank’s strategist also spoke about the disadvantages of the cryptocurrency space with lack of regulation being the main one. She sees the industry much more settled once this issue gets solved. The environmental concerns that crypto mining causes are the other big hurdle:
“In one year, Bitcoin uses around the same electricity as the entire population of Pakistan (c.217M people),” she reminded.
This has been a growing concern this year, but the number of companies and parties aiming to solve it has increased exponentially as well. For instance, several leading cryptocurrency exchanges have already launched initiatives that would make them carbon neutral, including FTX, BitMEX, and Gemini.
CBDCs, Cash, And Crypto
Laboure also gave her two cents about central bank digital currencies. She prefers decentralized cryptocurrencies saying that the centralized nature of the CBDCs would not be attractive to society. In any case, she believes both assets together with cash would successfully co-exist in the economic network.
On another note, Deutsche Bank’s CIO, Christian Nolting, opined somewhat differently on the matter. Back in May, he said that the impending launch of CBDCs would be a major threat to bitcoin in terms of serving as a currency:
“A widespread introduction of CBDCs accompanied by higher regulation of cryptocurrencies could create a more challenging environment for crypto assets as some of their advantages compared to traditional financial assets would fade in the longer term.”