The situation would have points of contact with the crash caused by technologies in the early 2000s and the mortgage crisis of 2008.
“Cryptocurrencies will cause the next financial crisis. When you look back over the past few decades and look at all the financial crises that have occurred, they all have a couple of things in common. And one of them is the massive adoption of a new financial product or a new technology that is not well understood”.
The warning was issued by Brett Heath, CEO of Metalla Royalty & Streaming, a Canadian-based company that operates in the precious metals segment and has a net present value of nearly $500 million.
Heath compared a future cryptocurrency crisis to the technology crash of the early 2000s and the 2008 mortgage crisis:
“If we rewind to the 2008 mortgage crisis, we had the massive adoption of mortgage-backed securities, collateralized debt obligations. And once the public adopted this new financial product, it crashed, which was a big problem,” he described.
Heath criticized investing large amounts of money in assets that have “no intrinsic value” and the end result of which would be a large sale.
“When that amount of capital is removed from digital wallets around the world, you are going to feel some major financial repercussions,” he said.
The executive also challenged predictions that Bitcoin will overtake gold as a store of value.
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