With the ongoing crypto market volatility, there is uncertainty regarding the sector’s future; several analysts maintain that the 2022 crash is expected, terming it part of the growth trajectory.
Economist and founder of HS Dent Publishing, Harry Dent, has maintained that crypto is the ‘next big thing’ but the market’s growth will mirror the dot-com bubble that saw stocks like Amazon (NASDAQ: AMZN) crash before rallying to record highs, he said during a ‘Rich Dad Radio Show‘ appearance on August 24.
According to Dent, the Bitcoin (BTC) crash might be interpreted as the end of the crypto market, but the economist stressed that would not be the case.
“I compare the cryptocurrencies, Bitcoin just like the Amazon of it, the new dot-com retailers that were the rave only the last part of the 90s bubble, and were the epitome of it. Amazon led that bubble and crashed 95%… before it went to 3,500 in the next boom,” he said.
Furthermore, Dent shared how he got into crypto after initially failing to understand the concept. The economist declared:
“I didn’t get it myself, until at my own conference a guy defined crypto as the digitization of all financial assets and money. And I’m like, what’s bigger than GDP six, seven times, all the financial assets in the world? And I’m like, oh! This is a big deal. This is the next big thing.”
Established cryptocurrencies to stand out
Notably, the crypto markets host thousands of cryptocurrencies, and there is a general consensus that once the sector matures, established assets like Bitcoin will stand out, similar to Amazon and the dot-com companies. At the same time, there is a belief that cryptocurrencies with no utility will be wiped out.
Previously, Dent had projected that there would be a historical market crash in 2022 amid rising inflation and the Federal Reserve’s tapering measures characterized by interest rate hikes.
However, he pointed out that the crash doesn’t need a trigger, just like the tech bubble burst in 2000 that occurred in an environment without a recession and economic slowdown.
Bitcoin is likely to correct further
Interestingly, the economist also noted that Bitcoin would be the worst-hit asset while projecting that the crypto will correct to about $7,000.
It is worth mentioning that Bitcoin and the equities markets have struggled in 2022, with the flagship cryptocurrency struggling to stay above the $20,000 level.
In this line, Bitcoin’s struggles were highlighted during the second quarter when it registered the worst quarterly returns at -56%. By press time, the asset was trading at $21,700, gaining almost 2% in the last 24 hours.
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