Bitcoin’s volatility has continued into 2022 as the cryptocurrency’s value surges. This comes just a week after it experienced the longest continuous decline since 2018 in the first week of January, with market analysts warning that a severe sell-off could take place take place if it falls below £40,000. The surge comes as inflation in the US rose by seven percent over the past year, the fastest it has risen in nearly 40 years.
The weakening value of the dollar is seen as one of the leading reasons why investors are looking to place funds in the cryptocurrency, which is often referred to as “digital gold” due to its finite supply.
While Bitcoin has many backers, Carol Alexander of Sussex University tells Express.co.uk that it will fail.
She believes Web 3.0, the third version of the internet that experts claim will incorporate decentralisation based on blockchains, will favour cryptocurrencies Ether, DOT, ADA and SOL.
Ether, DOT, ADA and SOL are traded on the Ethereum, Polkadot, Cardano and Solana blockchains respectively.
Prof Alexander said: “Web 3.0 is here now, and it’s growing. Bitcoin is a blockchain that can’t carry smart contracts. It was a joke from the beginning.
“Ethereum, Polkadot, Cardano and Solana were designed specially for smart contracts.
“The Bitcoin blockchain is obsolete, and if the coin is useless, it just becomes a speculative asset that can be played with by Wall Street giants.
“2022 will be the year of the coin. Ether, DOT, ADA and SOL – these coins power very good blockchains which power Web 3.0.
“Bitcoin uses up far too much energy, these other coins don’t. 2022 will be the year of the coin, but not Bitcoin.”
In fact, Prof Alexander believes Ether, DOT, ADA and SOL will be the “currencies of the future”.
She added: “Ether, DOT, ADA and SOL are going to become really important commodities because you will need them to put things on the blockchain.
“They will be the currencies of the future in a way. Maybe decades from now, they will be the currencies.
“This is way far into the future, but the pound, the dollar, the yen will no longer have the relevance that currencies for blockchains have, which will be international.
“The global economy will be powered by blockchains, not countries. This is where I see it ending up.”
Despite Prof Alexander’s critical view of Bitcoin, others are more optimistic about the cryptocurrency,
The head of a Swiss bank has predicted bitcoin will hit new record highs in 2022, based on his firm’s analysis.
Seba CEO Guido Buehler said the cryptocurrency could reach as high as $75,000 (£55,000) over the next 12 months as more institutional investors embrace it.
He made the prediction speaking to CNBC at the Crypto Finance Conference in St. Moritz in Switzerland on Wednesday.
He said: “Our internal valuation models indicate a price right now between $50,000 and $75,000. I’m quite confident we’re going to see that level. The question is always timing,” he said.
“Institutional money will probably drive the price up. We are working as a fully regulated bank. We have asset pools that are looking for the right time to invest.”