It seems that the bull market will kill 95% of the cryptocurrencies in the market. At least this is what Matt Hougan, the global head of research at Bitwise, said about virtual currencies and the cryptocurrency market as a whole.

During a conversation with Barry Ritholtz on his podcast, he said that Bitcoin was a total bubble as well. However, this does not mean that blockchain technology will disappear or that Bitcoin will go to zero.

After the dotcom bubble, several companies were able to emerge and grow. Some of these firms are Amazon, YouTube or Google, among others. Hougan is currently working with its company in assembling an index with the 10 largest digital currencies in the market and create a new ETF.

Due to the fact that bubbles tend to be negative for a specific asset, in the case of Bitcoin, it allowed many individuals to learn about it and participate in the market. Initial Coin Offerings (ICOs) were spreading at that time and many other firms have also been released to the market. Nevertheless, most of these firms were not able to survive the bear market that affected the whole space in 2018.

All these projects have something positive. They pooled several experts and developers together to start working in the space trying to improve it. Although the firms did not succeed, several talents remained in the most prosperous projects and keep improving the market.

Hougan compared Bitcoin’s bubble with the dotcom bubble:

“It did the same thing that happened with the Internet, which is it attracted a huge amount of talent. It did bring a lot of capital and interest in development to the ecosystem. So, I do think interesting things will be born from that. But, yes, it was a difficult year in 2018. I think Bitcoin is the next dotcom. Remember, the dotcom bubble created Pets.com but it also created Amazon.”

At the moment, there are more than 2000 virtual currencies operating in the market. Most of them will not be able to survive. According to him, they are useless and will die in a painful way. Additionally, he mentioned that the sooner that happens, the better for the whole ecosystem.

After all this hard time, several new firms and projects will emerge, similarly to what happened after the dotcom bubble. This bear market will help to clean the crypto space from virtual currencies that are worthless and to focus on those projects that have real value.

Millennials are also very positive about digital currencies. Indeed, Hougan says that this generation is going to consider Bitcoin as the new version of gold. According to him, every generation has an asset that the love or that they want to gain exposure to.

Virtual currencies are decentralized assets that do not depend on a centralized party to operate and allow individuals to use them. However, his point of view regarding millennials is different than the one that Scott Nations, CNBC analyst, has. Mr. Nations mentioned that millennials are too stupid to realize that Bitcoin is a bubble.

Hougan says that he does not pay attention to the constant hype that there is around Bitcoin and that the media gives to this digital asset. He believes that this is all cyclical and part of the course of Bitcoin. He also said that people should calm down about this issue.

In the past, Bitcoin has lost more than 70% of its price six or seven times and that after this dropped, Bitcoin started a new rally. In two years, the digital asset is still up more than 300%, thus, it depends on the perspective.

At the moment, there are different projects that are ready to allow financial institutions to place their funds in the cryptocurrency market. The Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange (NYSE), launched Bakkt, a platform specifically designed for institutional investors.

At the same time, Fidelity Investment is also thinking about new products and services for institutions and traditional investors.

Mike Novogratz, a Bitcoin supporter and Wall Street veteran, believes that institutional money will also pour into the market. This is similar to what Matt Houghan says about the future of the space.

“Fidelity is hiring up to 150 people to build a way for institutional investors to buy crypto and store it with a name they trust,” he commented. “One of the greatest brand names in the future.”

Currently, each Bitcoin can be purchased for $3,408 and it has a market capitalization of $59.73 billion. In the last 24 hours, it lost 1.69% of its price.

Bitcoin (BTC), Ethereum (ETH), XRP (Ripple), and BCH Top Coin Price Watch (Feb 5th)

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