Current Bitcoin Price Rally Analyzed by Chainlink Co-Founder Sergey Nazarov – Spotlight

Current Bitcoin Price Rally Analyzed by Chainlink Co-Founder Sergey Nazarov

Sergey Nazarov, the co-founder of Chainlink, discussed the possible cause of the ongoing increase in Bitcoin price during a recent interview with popular business news platform Yahoo Finance.

In addition to discussing the ongoing Bitcoin price rally, he also revealed in-depth details about the Chainlink oracle platform, the importance of the platform to the crypto and blockchain sphere, and what it hopes to achieve. Chainlink is a well-known oracle platform, with many commending it as the best oracle platform available today. This is especially due to its Sybil-resistant nodes.

Three Key Factors Responsible for Bitcoin Price Increase 

When asked about the current Bitcoin price rally and increased institutional interest in “King Crypto,” Sergey pointed out that three main factors stand out as the cause of this sudden interest in Bitcoin and the cryptocurrency sphere as a whole. He listed them as:

1. Impending Inflation (This varies between average consumer and institution.)

The current increase in inflation, especially due to the coronavirus pandemic, is a cause of concern to people. This rise in global inflation is driving people towards crypto adoption. Many schools of thought have referred to Bitcoin as a hedge against inflation. This belief of Bitcoin being a good hedge against inflation was also recently corroborated by Cynthia Lummis. Lummis is currently the senator-elect of Wyoming.

Sergey further added that the current traditional financial system is not well-equipped to combat inflation. Bitcoin, on the other hand, is a strong hedge against inflation as a result of its finite supply.

2. General Monetary Policies

Another major source of concern, according to Sergey, is current monetary policies. Conventional monetary policies have left a lot of people with mind-bugging questions. Questions like – are current monetary policies feasible? Are they connected to reality or just theory-based? What are the autodynamics around money printing by central banks? Scarcity as related to fiat currencies, as well as several other questions. Most of these policies are not styled to favor the average investor. Bitcoin, however, also serves as a hedge against these policies.

Interestingly, many banks are adopting crypto custody solutions and are moving towards the implementation of these solutions. The clamor to create a CBDC by these banks is also viable proof to willing investors that adopting Bitcoin is a good action path.

3. Decentralized Finance (DeFi)

Sergey pointed out that this is the most under-appreciated reason of them all. The current economic and financial climate today is that of high inflation and low yield. The ability to provide investors with a good yield holds major attraction today. Traditional finance and investment market yield is at an all-time low. Investors receive no more than 1% on their investments and, at times, as low as 0.1%.

Decentralized finance (DeFi), on the other hand, offer yields ranging between 1% – 8%. Therefore, serving as a reliable hedge against inflation as well as a means to generate yield.

2020 Q3 alone recorded over a 1000% increase in Total Value Locked (TVL) in DeFi projects.

Chainlink Use Cases

Sergey, during the interview, spoke briefly on Chainlink and its importance in the blockchain sphere. According to him, Chainlink promotes smart contracts. Smart contracts, simply put, are a more advanced version of Bitcoin. They are employed in the global finance market, insurance, gaming, and ad networks, and they eliminate all forms of deception

Bitcoin, on its own, is an important asset. However, it cannot operate without its underlying blockchain technology. Blockchain tech, beyond issuing BTC and other tokens, has a wide array of other prospective functions.

Chainlink, in simple terms, brings blockchain technology to smart contracts and its diverse functions.

Bitcoin (BTC) price

At the time of writing, Bitcoin was trading at $18,498.96, with a market cap of $343,306,159,805 and a 24-hour trading volume of $24,735,197,262.

Find out more about Bitcoin on the Altcoin Buzz YouTube channel.



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