The Winklevoss brothers are incredibly bullish on bitcoin, saying recently that its market cap could reach 100 times higher than it is right now.
The twins, who are major investors in bitcoin after becoming wealthy from an early partnership with Facebook founder Mark Zuckerberg, told CNBC at the Dealbook conference in New York that a $400bn market cap for BTC would be a “small bull case scenario”.
By some calculations, bitcoin may be worth more than the money in circulation in some countries, although that doesn’t take into account other economic factors such as GDP.
Also, countries regulate their currencies. With bitcoin, however, there are no guarantees since it is not backed by any state authority. This has made the virtual currency relatively risky, as scams and fraud have been prevalent. Nevertheless, the Winklevoss twins still believe that there will be favorable regulation regarding it.
“I think everyone recognizes the innovation and doesn’t want to stifle it. They just want to make sure there’s healthy regulations so it’s used in a safe and productive manner,” said Cameron Winklevoss.
The Winklevoss twins have a vested interest in bitcoin’s growing popularity, as is obvious by their reported investment of somewhere in the neighborhood of 108,000 BTC, according to Business Insider. That would be worth around $37M at a recent CoinDesk BPI valuation.
But they also want to bring bitcoin to the masses through an exchange-traded fund. The Winklevoss Bitcoin Trust filed for a $20m IPO with the Securities and Exchange Commission, in July. No date for the offering has been set.
The twins believe that even though bitcoin can be used for criminal activity, such as for black marketplaces like Silk Road, there is a lot of very legitimate demand for it as well.
“Prices are double what they were before Silk Road was shut down. So the demand to use bitcoin for illicit activity was clearly almost zero,” said Tyler Winklevoss.
The twins believe that bitcoin has some similar values to gold, an asset that many investors buy because they lack faith in the US dollar.
“Some people definitely view it as Gold 2.0,” Tyler Winklevoss told CNBC.