Bitcoin, a digital currency which was created as an alternative to the traditional financial system when the major economies sank into financial crisis in 2008, has had a long journey.
The cryptocurrency particularly came into the center spot when its price hit nearly $20,000 in December 2017 and, since then, it has attracted a lot of interest from institutional investors. While bitcoin evangelists do not see “price” as a gauge for the cryptocurrency’s success or failure, more often than not that seems to be the case.
The debate on whether bitcoin will be able to replace traditional fiat has been going on since its inception.
In a new report, UBS has estimated that for bitcoin to replace the U.S. money supply, its price would need to reach around $213,000 levels, or would require dramatic improvements in its network’s processing capabilities, Bloomberg reported. UBS said that bitcoin network’s capacity constraint could continue to hamper its usefulness.
“Our findings suggest that Bitcoin, in its current form, is too unstable and limited to become a viable means of payment for global transactions or a mainstream asset class,” the report found.