Major institutional investor John Pfeffer has predicted that Bitcoin will come to replace gold, while eventually being worth USD 700,000.

As reported by the Independent, John Pfeffer of UK-based Pfeffer Capital made the comments at the Sohn investment conference in New York.

“Bitcoin is the first viable candidate to replace gold the world has ever seen. So if Bitcoin becomes the dominant non-sovereign store of value, it could be the new gold or new reserve currency,” Pfeffer said at the event.

This was the first occasion that cryptocurrencies have been recommended at the Sohn investment conference, which has traditionally offered investors stock recommendations. It was perhaps only a matter of time for Bitcoin to be endorsed at such an event as major hedge fund investors have already begun divulging capital into digital currency assets.

According to a survey conducted by Thomson Reuters earlier this week, one in five financial institutions have plans to actively participate in the cryptocurrency market within the next 12 months.

Pfeffer did not overlook the potential problems of cryptocurrencies, however. He advised that Bitcoin was by far the strongest investment asset, while other currencies still carried “substantial risks“. Nonetheless, Pfeffer noted that unlike gold, these assets still had utility not diminished to just a store of value.

The real utility of crypto

Speaking to the Independent, Jesse Cohen, a senior analyst at Investing.com, discussed the legitimate utility cryptocurrencies have as an alternative to fiat currencies, particularly emphasizing the potential benefits of their use in countries with struggling economies. Investing.com indeed found that the top five countries most interested in cryptocurrency were Venezuela, Kosovo, Lithuania, Belarus and Georgia.

In a written statement to the news outlet, Cohen said, “In addition to cheap [cryptocurrency] mining costs, another thing that the Eastern European countries which appear on this list have in common is that all have gone through prolonged periods of war and recession recently, which has resulted in the poor working class losing trust in government and banks.”

An additional factor Cohen mentioned that could be aiding the boom of digital currencies in these countries were the recent currency crashes they all faced in the last 10 to 15 years. ”Such a devastating experience has led both old and young traders to seek out crypto as hedges against another failed currency episode,” the statement read.

The recent entrance into cryptocurrency from institutional investors such as George Soros and the Rothschilds is likely to strengthen the legitimacy of the market and further popularize its adoption.

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