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Ark Investment funds have faced a challenging time due to the cryptocurrencies’ increased volatility in the past few weeks.
The crypto market just entered a new phase of a bull market that will lead it to a trillion-dollar phase over the long term, thoughts highlighted by Cathie Wood’s Ark Investment Management LLC analyst Yassine Elmandjra.
“Over a longer-term time horizon we definitely think this is the beginning phase of what’s going to be the birth of an entirely new asset class that we think will be in the trillions of dollars,” Elmandjra said in an interview.
However, Ark Investment analyst raised an alarm over the vast adoption of the cryptocurrency industry by retail traders, citing that it is a potentially unstable, stimulus-fueled froth. Nonetheless, Elmandjra said that people have the right to put their money where their mouth is. “But with that being said, I can’t knock people for putting their money where their mouth is and deeming something to be of subjective value when others can’t see it,” he noted.
Speaking of which, the cryptocurrency industry hit $2.5 trillion in market capitalization in the past few days after Dogecoin (DOGE), Shiba Inu (SHIB) that has all experienced a hundredfold in the past few months.
According to the analyst, the cryptocurrency industry holds much potential to dethrone traditional perceived assets. Moreover, there has been a streak of institutional investors seeking cryptocurrencies’ exposure on their balance sheet.
Crypto Market and Ark Investment Analyst’s Thoughts
According to Elmandjra, the top two digital assets are poised to rally further and significantly eat away more of the global economy. Precisely, he argued that Bitcoin’s market value could catch up with that of gold in the next five years.
From a figures’ perspective, the current gold market capitalization is approximately 10X more than that of Bitcoin. In five years, If Bitcoin will have dethroned Gold’s market capitalization, that means the BTC market price will be more than 10X the current market price, thus a price target of more than $500k.
On the other hand, Elmandjra noted that Ethereum is a trillion-dollar setup awaiting time’s approval. Notably, Ethereum is up over 2000% in the past twelve months, whereby its market capitalization is around half a trillion.
Furthermore, the Ethereum ecosystem is a major contributor to the smart contract and decentralized finance (Defi) ecosystem. However, due to network congestion and the slow rollout of scale-up solutions, the Ethereum ecosystem is facing fierce competition from other smart contract and decentralized blockchains providers like Binance Smart Chain (BSC), Tron Foundation, and Polkadot Network.
Ark Investment funds have faced a challenging time due to the cryptocurrencies’ increased volatility in the past few weeks. Particularly, Bitcoin had dropped while other non-fundamental coins like Shiba Inu and Dogecoin have rallied exponentially.