determine what Bitcoin (BTC) and others Cryptocurrency Its value must always be difficult. Stocks are valued on the basis of turnover, and the value of bonds depends on the interest rate. With many digital assets such as Bitcoin, it is only a matter of demand and supply. Deutsche Bank analyst Marion Labourne gives us some additional guidance.
Rbell ringing for bitcoin
labourne ho Head of Macroeconomics at Deutsche Bank, The largest investment bank in Germany. in Interview with CNBC Explains how the price of a particular asset is determined. I mentioned diamond as an example. The value of a diamond is determined in part by how people view the shiny stones. If his image is positive, the price will go up, and once the image becomes less positive, the price will go down. This is called Tinker Bell Effect†
So it’s psychology, and cryptography is probably the purest form of that. This is especially true of Bitcoin. Bitcoin is not used in industrial products such as diamonds or precious metals, and is in fact relatively few in services Compared to some other cryptocurrencies† It is just a store of value that you can easily trade in.
Not all network effects are positive for cryptocurrencies
MUnfortunately, network effects work both ways. The situation with Terra (LUNA) showed us that if trust disappears, the project can also run blank very quickly. Deutsche Bank CEO says so So you should not compare Bitcoin with other cryptocurrencies. Altcoins They are younger and have a smaller market value. This means that they are more volatile and have less experienced investors.
This means that you have to understand how people think. The phrase “buy cheap, sell dear” sounds easy, but history teaches that people often do the opposite. Moreover, the CEO emphasizes that supply and demand are also important, and that cryptocurrencies are extremely volatile. However, she expects the regulations to be introduced soon. This means more adoption, and more adoption which is a positive for the pricing.
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