Seoul National University’s Professor Lee Jong-Seob: Bitcoin Demand to Surge as it Functions Like Digital Gold
Bitcoin has been a hot topic in the financial world once again, as interest grows in whether it can break through the $30k range. This comes after the recent bankruptcy of Silicon Valley Bank (SVB), which helped the cryptocurrency reach its highest price in months. If it succeeds in breaking through the $30k range, it will be the first time since May of last year.
According to industry experts, conflicting views have arisen in regards to Bitcoin’s recent surge. Some believe that the cryptocurrency’s identity as “digital gold” will continue to drive its upward trend as an inflation hedge, while others caution that it may be premature to declare a bull market.
Those who predict an upward trend have pointed out the correlation between Bitcoin and gold, with the two representing similar inflation hedges. Professor Lee Jong-seob of Seoul National University believes that Bitcoin is showing the same price trend as “digital gold” since the SVB crisis. He argues that the preservation of bank deposits announced by the Federal Reserve will encourage this trend, with short-term demand for Bitcoin being driven by inflation caused by deposit preservation.
On the other hand, there are concerns that a collapse may begin when funds begin to withdraw from large Bitcoin holders. Jang Jae-chul, chief economist at KB Kookmin Bank, cautioned that the perception of the crypto market has not improved and it is questionable whether this upward trend will be maintained even after the institutional financial market stabilizes.
Professor Lee also shares some of these concerns, stating that the Crypto Winter could be prolonged if the SVB bankruptcy spreads into a European financial crisis, leading to a chain of margin calls in the decentralized finance (DeFi) market.
Overall, it remains to be seen whether Bitcoin will continue its upward trend and break through the $30k range. While some experts predict a “Crypto Spring”, others caution that it may be too early to declare a bull market and that potential risks could lead to a prolonged “Crypto Winter”. As always, the cryptocurrency market remains highly volatile and unpredictable.
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