Bitcoin’s value has fallen, so its entire market capitalization is now much lower than the value of just one financial company – Visa. On the one hand, this may worry you. On the other hand, it shows the potential of the cryptocurrencies.
Visa’s market capitalization is now as high as $330 billion, while Bitcoin is only $130 billion. This is much less than in December 2017, when the cryptocurrency almost exceeded the current market capitalization of the digital payment giant.
Bitcoin compared to Visa and other market giants
Let us also remember that Visa is not the most valuable company on the financial market. Let’s take a look at JP Morgan’s valuation, which is currently $430 billion. MasterCard’s value is also almost three times Bitcoin’s market capitalization. It’s at $300 billion. This means that the cryptic market capitalization is worth about 10% of these three companies.
It’s impressive, but there’s something else to remember. The significant growth of the market share makes many investors seriously question whether these values are not already a bit out of touch with reality. Similarly, many of them are wondering whether the cryptocurrencies ones have not become underestimated by the market for the last two years. These analysts take into account their global nature and unique characteristics, including the fact that they may be considered “hard money”.
Wall Street is raging
Today the market is flooded with cheap money. In addition, the FED has further reduced interest rates in 2019. The answer is the frenzy on shares, which we have been observing for some time now. This is nothing new. Already in the past, the FED has been driving the boom by lowering interest rates and provoking investors to move their savings to Wall Street, where they pump up stock prices of American companies.
But what happens when the market says “I’m checking” and it turns out that company valuations are overstated? Investors will start to moor in safe havens (i.e. buy gold and silver), but also set out for forgotten treasures, which may turn out to be cryptocurreencies.