For Wall Street analysts and investors trying to figure out whether cryptocurrencies like bitcoin and ether are destined to deflate, Ethereum co-founder Joseph Lubin has an answer for you: yes.
But just because a bubble pops doesn’t mean it’s the end, he says. It actually might be better for the technology’s long-term growth.
“Of course it’s a bubble. Hopefully it’s one in a series of increasingly larger bubbles,” Lubin said at an event hosted by Quartz and Retro Report yesterday (Oct. 24) launching their What Happens Next series. “These bubbles bring attention, they bring value into the ecosystem. That value is recognized by software developers and business developers, and they create fundamental value and projects that grow the new architecture.”
Lubin says that a Gartner analyst recently pegged Ethereum’s developer base at 30 times larger than IBM-backed Hyperledger Fabric, a competitor in the blockchain space that enjoys all the benefits of having the support of a legacy computing company that has already won the trust of business.
Ether’s price hovers just below $300 at time of press, but in recent months has been struggling to recover to its all-time high of $414. Ether serves as a currency which users of Ethereum pay to keep their programs on the service’s decentralized computing service. A lower price means less bang for each ether.
Speaking to the volatility of cryptocurrencies, Lubin says that it’s just a matter of fewer people using them compared to traditional currency systems, and that it’s an addressable problem.