Billionaire Coinbase CEO Just Made This Crypto Prediction – Will It Happen?

Coinbase CEO Brian Armstrong has predicted that Bitcoin will become a serious fly-to-security asset in the next five or 10 years.

In an episode of Coinbase’s Around the Block podcast, titled “The State of Crypto and Where It’s Headed with Pomp,” the flagship cryptocurrency’s market capitalization is not yet large enough to serve as a serious fly-to-safety asset.

However, that could change in the next five or 10 years as the crypto economy grows to become “a significant enough percentage of the global economy.” Only after that could Bitcoin be treated as digital gold in the sense that people fly to the asset for safety when things go sour.

“I think we’ll see that probably change over time. I could see in the next five or ten years when the crypto economy really becomes a bigger percentage of global GDP that people will actually flee to Bitcoin as that kind of ‘new gold If you want, but it hasn’t happened yet, said the billionaire.

Armstrong noted that he had overestimated the chances of Bitcoin acting as a hedge against inflation in the current macro environment. “I thought it might actually draw more attention to Bitcoin in this kind of environment, but it looks like we’re a little early,” he said.

Bitcoin fails to act as a hedge against inflation

Bitcoin managed to gain more and more value in 2021 as inflation started to pick up. Even some prominent banks and high-profile investors are promoting the theory that Bitcoin acts as a hedge against inflation.

For example, Paul Tudor Jones, an American billionaire hedge fund manager, told CNBC in mid-October 2021 that he sees Bitcoin as a better hedge against inflation than gold. “That would be my preference over gold at the moment. There’s obviously a place for crypto. It’s clearly winning the race against gold at the moment,” he said.

Similarly, strategists at JPMorgan said in late October last year that inflation concerns were driving Bitcoin’s rally. “We believe the perception of Bitcoin as a better inflation hedge than gold is the main reason for the current rally, triggering a shift away from gold ETFs to Bitcoin funds since September,” they said in a note.

However, the leading cryptocurrency failed to maintain its upward trend in 2022 despite record inflation numbers. Instead, the coin extended its losses as more and more central banks began raising interest rates in an attempt to curb inflation.