Allianz chief economic advisor Mohamed El-Erian addressed Bitcoin’s likely future during an appearance on CNBC’s Squawk Box on Friday. He suggested that the world’s most well-known digital currency’s future will not be as a currency, but as a tradeable commodity asset that people can use as a store of value. He also predicted a similar fate for other cryptocurrencies.
According to El-Erian, Bitcoin enthusiasts who dream of a world where Bitcoin is a globally-accepted currency are likely to be disappointed:
"It will be a means of exchange. It's not going to be a currency, it's going to be another commodity-like asset out there that you can trade, and mainly as a store of value."
During his remarks, El-Erian said that he foresees greater government involvement with digital currency technology as well:
"I suspect that if you look 10 to 15 years down the road, we will have digital currencies but the public sector will have involvement in that. It will not be pure bitcoin. But the blockchain technology, take that seriously.”
El-Erian offered his opinion on Bitcoin’s current value as well, suggesting that a drop below $5,000 might represent a significant buying opportunity. He expressed doubts about the coin’s ability to regain last December’s record price high but said that consolidation by "people who really believe in the future of Bitcoin" would lift prices.
El-Erian’s remarks came as Bitcoin’s price dropped to around $5,850 and some observers were predicting an even sharper decline. In the few days since his CNBC appearance, the price has recovered to about $6,300.