Bitcoin Price Driven More by Speculation Than Utility: BitPay CEO
BitPay CEO Stephen Pair has stated that speculation drives a substantial part of bitcoin’s current valuation, while the actual use of the crypto market leader as a currency is responsible for only a relatively small fraction of its price. Speaking on CNBC’s Squawk Box, Pair revealed that BitPay intends to change this situation significantly over the next few years.
In his words:
“A very big component of the price is certainly speculation. It’s investors speculating on the future usage and adoption of this technology. A small component of the price is actual utility, and that’s what BitPay is focused on — using the platform and delivering products to our customers that they find valuable.”
Expected Predominance of Blockchain Payments
Speaking further, Pair stated that BitPay believes that mass adoption is a key driver of the future price of bitcoin, and it is focused entirely on building supporting infrastructure to make this possible. Responding to a question from the host about his opinion on the impact of the long-awaited bitcoin ETF on the asset’s price, he said that he there are many catalysts for bitcoin to hit the highs of late 2017 apart from ETF adoption or launches.
In his view, BitPay’s current transaction volume of about $1 billion a year should ideally grow to $10 billion or $100 billion annually in a few years as more and more customers begin to expect cryptocurrency payment support across a wide range of everyday retail and transaction applications. When this happens, according to him, the bitcoin price will be driven to highs comparable to December last year.
Significantly, Pair revealed that in his opinion, blockchain adoption would expand far beyond the cryptocurrency space and become accepted as the default database style. Within a three to five year time frame, Pair said, everyday users will be able to go into a restaurant or retail establishment and reasonably expect support for a blockchain payment.
He also predicted that this would extend beyond bitcoin as more and more blockchain-hosted assets would become default means of storing and transferring value.
In his words:
“Our thesis at BitPay is that most digital assets will be issued on a blockchain and most payments will be issued on a blockchain. We are building a platform for that future. Remember this is not just about bitcoin or the various tokens that we see today. It’s also about issuing dollars or euros on a blockchain. So we’re not just talking about payments denominated in bitcoin terms when we speak about blockchain payments. We’re talking about all kinds of digital assets that could be used for that payment.”
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