Bitcoin and Mike Novogratz go together like peanut butter and jelly: but to the surprise of many, the bullish prognosticator has now suggested that Ethereum is likely to dominate the sphere of online payments.
In a keynote speech at the Ethereal Summit, the founder of Galaxy Digital Capital emphasized that the second-largest cryptocurrency has the potential to dominate Web 3.0, and may eclipse Bitcoin as the most valuable blockchain network.
“There’s good news and bad news” for Ethereum investors, Novogratz said. “The good news is that Ethereum is way ahead,” he said, noting the enormous number of developers and companies building on the smart contracts platform. “Ethereum, by a long shot, has the most people in the room.”
This, he said, would be a formidable advantage over competitors like Cosmos or Polkadot, which may soon launch with more advanced technology but will be far behind in terms of adoption interest. “What we looked at as investors, and what I stress, is that it only works if there are people in the room.”
Litecoin, for example, has a “very vibrant community,” according to Novogratz. “But it’s a community of speculators,” he said. “There’s no one building anything on the Litecoin blockchain.”
“ To me,” he added, Litecoin has “no future. “
Bitcoin Will Likely Lead For a Long Time
Although Ethereum may eventually eclipse Bitcoin as the most valuable digital asset, Novogratz highlighted that Bitcoin will continue to lead as the de facto cryptocurrency for some time. “Bitcoin is really establishing itself as a store of value,” he said. “The debate is over. We won.”
This would likely cement Bitcoin’s short- to mid-term lead as the leading cryptocurrency, and its utility as a store of value. “I see the on-ramps for institutions who now believe its a store of value who are coming in,” Novogratz said. “Bitcoin is going to stay for a while because that’s where the institutions are going to start.”
However, Novogratz predicted that Bitcoin’s store-of-value properties would eventually be eclipsed by smart contracts and decentralized applications. “The really cool stuff is Web 3.0,” he said. “That’s the revolution in a lot of ways.”
Government Currencies Are Coming
Online payments present a “phenomenally important” opportunity for blockchain technology, Novogratz added, saying they would provide an important alternative to state-controlled currencies.
“95% of financial transactions in China happen on a phone. Those transactions go through a government clearinghouse,” he added, which “gets plugged into big brother’s machine-learning AI. So they know what you’re thinking and how you behave.”
Along with facial recognition and big data analysis, these data are used to restrict Chinese citizens according to their social responsibility scores. “We have Brave New World crashing on us faster than we can imagine,” Novogratz added. “We’re in this very scary world where the blockchain and a decentralized system of payments, I think, are essential to our life liberty and pursuit of happiness.”