Novogratz Voices Concern That Bitcoin’s Price Increase May Result in Government Regulation
The phenomenal increase in Bitcoin’s price could pave the way for the possible introduction of government regulatory systems.
There’s no doubt about it: Bitcoin is reaching and exceeding record heights. First, it made five-figure headlines by reaching $10k last week, and yesterday saw it break through the $12k ceiling. By growing over 1000% in this year, it seems that the only way is up for this super cryptocurrency.
This astronomical upward price trajectory has kept the conversation going for both enthusiasts and cynics alike. However, according to Michael Novogratz, this price surge may also get the attention of government regulators. ICOs are already getting the regulation treatment thanks to Russia’s efforts to lead a global partnership with itself and 30 other countries, including Malaysia.
Novogratz Discusses Regulation Concerns
While speaking at CNBC’s Power Lunch on the 5th of December, the Galaxy Investment Partners CEO and hedge fund extraordinaire voiced his thoughts on the matter. He said:
I’ve got concern that if price movements go higher we’re going to get more regulation. I think it’s hard to shut down, I don’t think that’s a probability.
Novogratz went on to explain:
One of the big risks out there right now is that prices are moving so fast that regulators are going to get nervous. I could legitimately see Bitcoin go $13,000, $14,000, $20,000, $25,000 and see somebody balk.
He added that most regulators, including those in the US, who are working with crypto are “intrigued” by it. They’re not the only ones. The whole world is looking at virtual currencies and wondering, where to next?
“We’re in a speculative frenzy. Period. Stop. How long can it go? Who knows,” Novogratz said. “What’s interesting about this is it’s global.”
According to the Autonomous Next financial research firm, there are at least 171 cryptofunds out there, with a massive 123 launched in this year alone. Thus proving that 2017 is definitely the year for crypto.
From Popular Crypto to Solid Investment Option
The price unpredictability of Bitcoin has previously made potential investors a bit apprehensive, but this view is slowly changing as well-established financial institutions have realized the lucrative potential that Bitcoin may have as a legitimate asset.
CBOE has recently announced that they will be launching their Bitcoin futures on the 10th of December, while CME will launch theirs on the 18th of December. In addition, Nasdaq has reported that they will be introducing their Bitcoin futures product next year.
With this new offering of futures, the road to mainstream adoption of Bitcoin and cryptocurrencies may not be as bumpy as in previous years. In fact, Novogratz sees virtual currencies being widely utilized in our everyday lives in the future for cloud-sharing and even ride-sharing, among other uses.
Still Not a Currency
However, even with its increasing popularity and price, or perhaps because of it, Novogratz does not see Bitcoin evolving into a currency. He says:
Bitcoin is winning out as digital gold. I don’t think it’s going to be a currency. Nothing that volatile is going to be a currency.
Do you think that cryptocurrencies will eventually be regulated? Will efforts to do this be successful? Let us know in the comments below!
Images courtesy of Bitcoinist archives and Pixabay.