Tim Draper: Bitcoin's Price Still Headed to $10k
Despite continued interest from major payments companies and thought leaders, the price of bitcoin has declined in recent weeks, as optimism surrounding New York's proposed bitcoin regulation gave way to backlash and the market grappled with the widespread use of new and more complex financial tools.
Both factors were recently cited by bitcoin hedge fund Pantera Capital as reason's that bitcoin's price has declined since July. In that time, the price of 1 BTC has fallen from close to $650 amid heightened interest from investors at the time of the US government's auction of roughly 30,000 BTC to a value of $472 at the time of publication.
Still, it's arguable that no investor has been more exposed to this recent price decline than noted venture capitalist and Draper Fisher Jurvetson (DFJ) partner Tim Draper, who on 2nd July revealed he purchased all of the nearly 30,000 BTC seized from now-defunct online black market Silk Road and sold by the US government.
In a new interview with CoinDesk, Draper revealed he has been surprised by bitcoin's recent decline in value, though he remains optimistic in its long-term value as an asset.
Draper told CoinDesk:
"I guess the markets aren’t seeing what I am seeing. An entire economy is being rebuilt. I have a price target of $10,000 in three years. Even that may be pessimistic."
The remarks are notable given that, should Draper have paid market price for the BTC holdings, he would have lost roughly $5m on his investment to date.
Bullish in emerging markets
Draper also addressed his overall investment strategy and recent moves, most of which have targeted bitcoin startups in emerging markets.
The 56-year-old investor, who has contributed to recent funding rounds raised by BitPagos, Korbit and Volabit, told CoinDesk that he believes these companies will ultimately succeed in the face of steep challenges.
Draper's remarks suggest that he foresees these companies being able to overcome any obstacles posed by regulation and a current lack of consumer awareness, stating:
"These companies are making it easier for people to do business in their countries. As long as the governments realize that they are better off when their people are successful, it should be smooth sailing for our bitcoin investments."
Investors should buy bitcoin
Price decline aside, Draper said he believes that investors should continue to seek opportunities in the bitcoin market, saying he would "encourage people to buy bitcoins and spend them".
When asked what advice he would provide to investors and entrepreneurs observing the market, he pointed to bitcoin's long-term utility as well as its low-cost transaction network.
"I assume anyone who used to send money through Western Union already is familiar with how much they can save using bitcoin."
He went on to suggest that, in this view, investors should continue to seek opportunities available by both investing directly in bitcoin and its support infrastructure.
"My thinking is that bitcoin is here to stay," Draper concluded.
Images via Wikipedia
Bitcoin Shop's Management Forgo Salaries as Share Price...
Bitso Targets Mexico's Mobile Phone Users With SMS Bitcoin...