Citibank calls bitcoin the „pole star“ of the crypto space
A Citibank report calls Bitcoin the „pole star“ of the crypto space. The bank thus contradicts its last report from 2014.
Bitcoin is currently experiencing turbulent times. After the cryptocurrency reached a new all-time high (58,330.57 US dollars) at the end of February, the digital store of value headed south before catching itself at 43,241.62 US dollars and now seems to be slowly recovering. Now Citibank, one of the world’s largest retail banks, is publishing a report in which it sings the praises of Bitcoin and believes the „polar star“ of cryptocurrencies is at an „inflection point“.
The report begins with a résumé of the last Bitcoin article from 2014, when it was concluded that the Bitcoin Loophole cryptocurrency was a „wannabe asset“ and „wannabe means of payment“ that would have no practical application. It is more likely that another digital currency will prevail.
Bitcoin now seems to have proved Citibank wrong. In the current report, many parameters have changed, it says. It has been recognised that disruptive innovations, i.e. developments that can make existing technologies obsolete, need time to be increasingly used by the population. However, the report says that this window of use has „dramatically“ narrowed.
„Bitcoin has changed“.
So it is no surprise to the authors of the report that Bitcoin has changed since the last assessment
This is primarily due to the user numbers and the 1 trillion market capitalisation in the meantime. In addition, the fact that an entire crypto-economy has developed around Bitcoin should be emphasised. The most important change that convinced the authors, however, is the change that Bitcoin had undergone. Away from a primarily retail-focused currency, to an inflation-hedging asset that was attracting more and more institutional interest.
According to the report, the market is already responding to the growing curiosity of the institutional sector, with, for example, more and more crypto exchanges including specific implementations for large investors to help them get started. In this context, Citibank did not only refer to Bitcoin as „digital gold“, as for example at the Bloomberg Crypto Summit. The authors of the report went even further:
‚All these assessments of Bitcoin’s potential, of how it is giving rise to, influencing and inspiring new business models in the blockchain space, leads us to call it the North Star.
Citi GPS, „BITCOIN At the Tipping Point,“ March 1, 2021
Whether Bitcoin can continue to fulfil this potential and drive further technological transformation is unclear. For the authors, however, it is clear that the asset has reached a new phase in its development. Currently, the crypto firmament seems to be somewhat darkened. Whether the „polar star“ can bring light into the darkness again remains to be seen.