A brand-new crypto press release from Prior Consultancy today delivers the prophecy of Ian McLeod of Thomas Crown Art.
First, McLeod posits that the global economy will slow down over 2019, and that after the new year, traditional investors will see blood on the ledger.
Some of the primary drivers of loss or “lack of expansion” McLeod cites include:
- Trade tensions between countries
- Higher interest rates
- Political uncertainty
- “Complacent” financial markets
Brexit, he says, is one significant issue and a symptom of the problem of global uncertainty.
Of course, experts are also watching the actions of the U.S. Federal Reserve Bank after historic efforts to keep interest rates near zero. Interest rates can’t be artificially low forever, and now they are starting to climb back up.
“The U.S., the world’s largest economy, has, of course, considerable influence on Asian and European economies,” McLeod says, according to Prior Consultancy. “As such, should the U.S. stock market plunge – as it did recently scrapping all of its 2018 gains during a major sell-off – global markets are vulnerable too .. against this backdrop, we can expect cryptocurrencies will increasingly be seen as investors’ ‘safe havens’ in 2019 and beyond.”
McLeod suggests that in some ways, cryptocurrencies will be like gold or other hedges – implying that investors might tend toward the principle of ‘storing your money in a mattress.’
In characterizing coins as safe havens, McLeod suggests future demand will be stable.
“There are several keys reasons why the likes of Bitcoin and Ethereum will be safe havens,” McLeod says. “ These include scarcity, because there’s a limited supply; permanence, they don’t face any decay or deterioration that erode their value; and future demand certainty as mass adoption of cryptocurrencies and blockchain, the technology that underpins them, takes hold globally.”
There are many arguments for cryptocurrencies as stable digital disruptors, but McLeod’s argument seems to be a little different – he’s pointing to a variety of businesses and projects that use blockchain technology as an underpinning. The idea is that if these businesses stay solvent, their source of digital currency will also stay stable.
“Ethereum’s blockchain, for instance, is used in our art business,” he says. “It has allowed us to create a system to use artworks as a literal store of value; it becomes a cryptocurrency wallet … It also solves authenticity and provenance issues – essential in the world of art. All our works of art are logged on the Ethereum’s blockchain with a unique ‘smART’ contract.”
For some traders, it’s hard to square McLeod’s ebullient testimony with the short term negativity – as Bitcoin has sunk down to around $3,600, prices that holders haven’t seen in a couple of years, and Bitcoin scams in Singapore make headlines.
However, there’s a difference between daily volatility and long-term buy-and-hold strategy, so as you do your due diligence, continue to look at how secondary businesses can contribute to the cryptocurrency sector.