On Thursday (July 15), prominent on-chain analyst Willy Woo made some comments that suggested he believes that those people who try to praise Bitcoin by calling it “digital gold” are doing the flagship cryptocurrency a disservice.

Woo thinks that Bitcoin is not a much better store of value of gold because it is like a digital version of gold but because it is more like decentralized digital gold.

And here is how Woo explained in the following tweet why that decentralization is important:

“Bitcoin is digital gold? Gold FAILED. The Gold Standard failed. Gold’s failure lead to fiat. Why? It was centralised. When governments ran out of gold, money decoupled from gold and we got fiat. Bitcoin is decentralised gold, it removes gold’s failures.“

And when one commenter said that at least gold does not rely on miners to exist, Woo said that this would not be a problem because economic incentives would ensure that if one Bitcoin miner quit, other people would quickly replace them:

Crypto analyst and journalist Joseph Young said earlier today that even though Bitcoin has suffered a 50% price correction this year, it still has managed to outperform gold by 15% in the year-to-date period:

In late March, Woo made some interesting and super bullish long-term predictions about Bitcoin on day three of Real Vision’s “Crypto Gathering” event at a panel hosted by Laura Shin.

Woo said that by tracking BTC outflows from crypto exchanges, it is easy to see that a Bitcoin supply crisis lies ahead:

“We can see this from tracking the flows of coins out of the exchanges, where typically people speculate or buy and sell their coins, and they have a set inventory, some of which is allocated for speculation. We’ve just seen an unprecedented amount of depletion of that inventory.

“If you look back in the 2017 bull market, we saw like a five month depletion of inventory, and that was enough to propel the bull market of 2017 right up to the $20,000 [level] from what initially was about $1,000 to $1,500 when the inventory depletion ended, and now we’re in this zone of the Lehman’s 12 months of inventory depletion.“

Woo considers to be still incredibly cheap and expects Bitcoin’s market cap to eventually become a lot higher than gold’s market cap (which is currently around $10 trillion):

“Once you get a glimpse of something that’s easy to access like Bitcoin without the trouble of holding assets like real estate, it’s going to take a big chunk out of that. There’s no way Bitcoin is going to stop at the market cap of gold, which is $10 trillion, it’s going to go a lot higher, which means that we’re going to be going into the millions of dollars per coin, which is hard to believe right now but if you look at the sheer fundamentals and stretch it off over the long term, that’s how cheap Bitcoin is today.“

He also expects Bitcoin adoption to grow very rapidly over the next few years:

“This thing has been growing for 11 years nonstop and doubling every 12 months. That puts us at 4%, then 8%, and so forth. We’re currently on track for 1 billion people having exposure to Bitcoin as an asset class in the next four years. By 2025, 1/8th of the world population will have exposure to this monetary base. It’s happening very, very quickly.“

DISCLAIMER

The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.

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Photo by “petre_barlea” via Pixabay