and china and russia on the other incoming u.s. president joe biden believes in the u.n. and international cooperation but he'll face a u.n. system with growing discord in a world where some see the united nations as increasingly irrelevant james al-jazeera. this is al-jazeera and these the top stories u.s. democrats are pushing to impeach president donald trump for inciting violence at capitol hill at least $180.00 politicians are co-sponsoring a resolution they plan to introduce it on monday with a vote possibly by wednesday. sadly the persons running executive branch is a drain judged unhinged dangerous president of the united states and only a number of days until we can be protected from him but he has done something so

serious that there should be prosecution against him well i gather that the 25th amendment is off the table that isn't nothing is off the table more than 50 people are now facing charges for taking part in wednesday's storming of capitol hill in washington thanks jake underlay who is seen wearing horns during the siege and another man who's been named as adam christian johnson was photographed carrying off speaker nancy pelosi collector from the house of representatives many of the right is posted images on the internet and the f.b.i. has asked for help in identifying them the white house says it's lifting decades long restrictions on official contact with taiwan you know move shorter and get the chinese government this comes just before a visit by the u.s. ambassador to the u.n. . search teams in indonesia have to take to the signal from the flight recorder from a passenger jet which crashed into the java sea the boeing 737500 with 62 people on

board disappeared from radar screens minutes after takeoff the u.k. health secretary says britain is vaccinating 200000 people a day against covert 90 but hancock says the opening mass vaccination centers this week the outbreak continues to surgeons very strictures will likely be in place for another 3 months england's chief medical officer is warning that the national health service is facing its most dangerous situation in living memory. people in kyrgyzstan are voting in presidential elections free months after mass protests forced the government to resign. just months ago he was serving a lengthy prison sentence for kidnapping he was freed from jail by supporters in october. as the headlines the news continues here on al-jazeera right after inside story which is coming up next season.

will it be the currency of the future bitcoin has just hit a record high and is poised to rise even further but many argue it is only a speculative asset so exactly what describing this increase in quebec coins be a new safe haven this is inside story. hello and welcome again to inside story from doha with me today pretty well it's bitcoin season again the time of year when the world's most famous and least understood currency explodes in value seemingly for no reason at all in march last

year a single bit coin was worth $5000.00 u.s. dollars in december it hit $20000.00 for the 1st time as we came into the new year 30000 just days later it's now 40000 it has those already on the bitcoin train guessing at where it goes next and those who aren't playing a game of well what if. we have a panel of experts of course standing by to on ravel this latest rise for you but 1st if like many including me you're still confused about what bitcoin actually is and other cryptocurrency is what they are to here's what you need to know about the basics now with any type of online currency every transaction needs to go through a middleman now that's usually of course a bank or a money exchange facility there the one who say is yes person a has given money to person b. crypto currency is the name given to any digital currency which allows you to skip that middleman it does that by

a very complicated system called block chain that's unique to a few crypto currency and is said to make them safer all you really need to know is that instead of one person recording the transaction it is recorded on thousands of computers at once known as a decentralized system bitcoin is simply the 1st and also the best known version of crypto currencies but there are many many more in the last 4 days at least 30 others have been created. ok let's bring in our guests from new york we have matthew gets he's the founder and c.e.o. of block tower capital a crypto currency asset investment firm in london we have garrick heilman he's a crypto currency economist and head of research at blocked chain dot com and also in new york we have john biggs he's the editor in chief of the technology website good is modem welcome to you all gentlemen matthew in new york coming to you 1st

how high could this go. yes thanks for having me this is an interesting moment for bitcoin for cryptocurrency at large we look at it from an the institutional perspective and see this market cycle in the early to middle stages and what i mean by that is most of these bull markets in any asset class whether equities or cryptocurrency they start by climbing the wall of worry and then they move into a part of the cycle that is what i call a trending bull market where people are looking for good news and data to interpret and you have real buyers and real demand and that's where we are right now and i think a key driver here relative to previous adoption cycles is it's now institutional and we can talk more about that what that means who these institutions are where the demand is coming from and what they're buying but effectively that means we

have a long way to go between now and the end of when these institutions finish heiling into the assets and a key transition point that's happened is we've shifted from speculators to these institutional allocators they're allocating for long term in the space so it can go significantly higher people put price targets out i wouldn't be surprised to see 100000 or more even in the next 12 to 18 months gary coleman in london is there enough up draw in this particular facet of the market. by that you mean momentum to drive the price higher i mean i think the answer to that is yes and one of the challenges with understanding how high the price can go is you know big coin is something that's relatively novel we've seen alternative currencies you know in the you know arise in the past but you know this is the 1st the centralized digital alternative currency or asset we've never. seen grow to this size and

monetary assets by nature are difficult to value their value based on supply and demand a lot of people reference goal and equate is there in the nickname digital gold the size of the entire gold market is 10 trillion big point today is worth less than one trillion about 730000000000 roughly a president many people think that they claim which has more functionality in many ways than gold and has a a tighter scarcity well actually surpass in eclipse goals total market value at some point when that could happen is anyone's guess but a big part of the story in q 4 is wall street investors and others rotating some of their old allocation out of things like gold e.t.f. city into big point that's something j.p. morgan another bank suppose observed and talked about so that's i think a big part of it's driving the price right now so jumping back in new york if

institutional investor has a rotating away from traditional safe havens like gold does that mean that the rest of us should be i'm not wishing to get you to breach any kind of insider trading legislation but should we be buying bitcoin. absolutely not. i mean what these guys aren't saying is that they don't know why the prices so high they'll give you all kinds of give you all kinds of fascinating information but most of this is basically the hype cycle at this point in the game i mean you're looking at an investment of 40 k. for the average person that's almost impossible so maybe you could buy a little bit you could try it out you could see what happens but unless you're unless you're an insider in this game at this point we've pretty much reached the point where you can you can make your millions. i stare and there are people out there who have made these millions but they invested in 2010 early on and because

this has no real bearing on reality aside from maybe a political connection libertarians are putting their investments into into crypto because it seems like a good place to go. there's really no bearing on reality of what's happening here so this market is completely completely free to testicle matthew back in new york as well so explain to us why these institutional investors are thinking it's the right place to be because according to joel and also in new york it absolutely is not. yeah i love a good debate appreciate the comments jon. yeah i mean i'll take the other side of that pretty pretty strongly so. i came from the institutional world my co-founder was a portfolio manager at a university endowment and the thesis was institutions would ultimately end up investing in allocating to disk as a new asset as a new asset class early on john's right you know there were engineers there were

technologists there were early adopters who got into the space 5710 years ago while it mature well the industry mature and while bitcoin mature as a financial asset which it very much now is the market structure the market infrastructure is there now you have institutional demand and he and he and john mentions it's not based on anything real it's based on very real things so one thing that happened in 2020 for example if we look around new york if you look around the u.s. if you look around what institutions companies people investors faced what they internalized in 2020 is a pretty dramatic shift if you think and look at the macro economic backdrop you had a moment in march where risk assets completely fell out of bed and then we experienced a k shaped recovery you had wall street and stocks deal emanate from their

underlying fundamentals and you saw the performance of various stock markets of the nasdaq of big tech etc last year matthew can i answer i'm just push you for a 2nd which i sincerely apologize a k shaped recovery assume i'm a complete idiot what does that mean and when you talk about investments d laminating in a sentence give me a sense of what that means as well. short yes ok shaped recovery meaning wall street stocks went one direction i.e. up but the reality the underlying fundamentals for people human beings their livelihood small businesses as has been well documented throughout the pandemic experienced in many ways a very different reality the reaction to that from central bankers from the fed here in the us was stimulus what was more money printing then and ever incurred in history i think it's something like 30 percent of all u.s. dollars that exist were created last year in 2020 ok let me just say that

idea of inflation and i guess you would call it consists of easing which is basically printing money to put money into the system as a stimulus but gary coleman in london can this crypto currency be a hedge a defense against inflation when you have governments around the world anticipate seeing recession maybe tipping over into a 1922 style depression where they have to start printing more money to get it into the system because people around the world because of coded we haven't seen this many people losing their jobs this quickly for a long long time. this short answer is yes so even before the pandemic many were concerned myself included about the unprecedented level of debt. world record levels of debt on the public sectors balance sheets on government

balance sheets in the private sector and elsewhere with a pandemic that debt picture is only worsen and historically hard assets traditionally gold but also real estate other scarce difficult to mass produce assets and stores a value our have done well jury periods of inflated risk of financial crisis and they point is we have argued in a blog post titled the world's hardest acid is ironically virtual that being the quien is is in many ways purity both because it has a cap supply and this is digitally algorithmically scarce in a way that gold can never be or anything physical. that you know in theory and you all must go mine more gold one day and the mars asteroid belt

and so this algorithmic scarcity is very attractive for people who are concerned about more money chasing the same number of things and you see it in stocks you see it in real estate you see it also with crypto assets like big quaint. asset prices are going up as this wall of stimulus and money printing is occurring and you know i this is a not to to to criticize that effort people are in serious trouble in many parts of the world and some stimulus is is certainly warranted it's been a bipartisan effort in the united states and elsewhere to support ok you don't think so new york if there is to be a course correction in this upward trend with this particular cryptocurrency indeed with any cryptocurrency what will the course correction be i mean what will be the spark that leads to the coast being corrected. course correction in what way i guess is the question are we talking about economic recession i mean the the only

people that are saved in their proposition are essentially 3 folks on the on the t.v. and i'm assuming that you don't have any bet quite so they're suggesting that because if we hit a $122.00 depression that bitcoin is going to pull us out of it there are going to be companies that will survive there will be companies that are that are managing out that have invested in it and assuming this is assuming there is a big assumption that it stays up in the 40 k.'s even $100.00 ks then those guys will be fine and you know we're going to flip into a new era would show every turbulent air does you lose your you lose your. dale carnegie you you lose your carnegie's and you get your j.p. morgan's after each one of these things so we're in this we're in a very uncertain period right now but has the u.s. government invested very much in the big question now they have a little bit i'm sure but they're not talking about it actively has any government

out there changed their entire gold hoard to something to virtual currencies absolutely not it's not a it's not a sure it's institutional but it's definitely not political stuff in a governmental that's that's the key thing let's go back to matthew in new york as well matthew gets is that part of the appeal for all investors in crypto currency is to pick up on the point that john banks was making it's not linked per se to a central bank it's not linked therefore to the u.s. dollar so it's not linked to the federal reserve it's not linked to the euro is not linked to any of the the lower down the food chain currencies therefore it's not linked to any president or prime minister or any finance minister anywhere in the world who can talk to a central bank and government literally government economic policy. yeah those are great points and all ones peter that i that i would have made you stated a more eloquently than may so so on the back of john's comments yeah that's

actually part of why this is bullish right you have waves of adoption and market participants who come in over time 1st is the technologist then it's the high net worth individuals then it's the you know venture capitalists net then it's the then then it's the you know family offices and now the institutions you have public companies buying it on their balance sheet in the u.s. you have insurance companies like mass mutual that's 169 year old massive insurance company buying it in their general account so the next wave of this is going to be more of those more insurance companies more public companies ultimately it will be sovereigns and governments who are buying this that is the direction this is all headed that's what makes it asymmetric and helpful to people and to the point peter that you make about it not being linked to a few currency like the dollar the euro the yen and that is part of its value proposition as well because as we're seeing with the fed and the expansion of the

monetary supply if you leave your money in the dollar you're going to lose half of it over the next 5 years with the rate of monetary expansion so when you have a hard asset like eric was mentioning like because that has finite supply that can't be inflated away by a politician a central banker a c.e.o. right if tesla goes up 10 x. what's you on musk going to do he's going to print more stock you can't do that with declines in the hardest of hard assets ok because that's in effect in effect what you're saying is it's a finite asset and that's why it's a supply and demand issue joan joan biggs in new york as well what do you say to those people who say these crypto currencies are a great idea and they say they're a great idea because their logic some of their logic says this it means that money in inverted commas can be fairer in the way it's you. used by the people who use it so that's why certain ministrations in the west indies are experimenting with this and if you look at the continent of africa where a banking system for

a lot of people simply doesn't exist their mobile phone with an app becomes their banking system so you can live in a poor country and putting that in inverted commas or a country that has little slash no infrastructure but you can still do banking and in effect live in a crypto currency world. well so so i think let's let's talk about that 1st point i mean you can still do banking and the and the banking doesn't necessarily have to be connected with any sort of crypto currency might my view of the crypto currency and i think i think they said that i think the other 2 guys said it best when they basically said look who owns this right now it's it's the early adopters technologists you know exactly how to hold it you never want to hold on to any online wallet it's the 1st track so they know exactly how to hold it without getting robbed. they also know how the institutions not hold it now so and and presumably the governments are venture you know how to hold it but the average

person does not hold it so there's really no there's really no benefit so you're still using a middleman the goal of this whole process the whole system. is original vision was that this was going to be a democratized completely decentralized banking system that anybody could use it's not it's it's really really difficult to use you can get wrecked in seconds and yeah maybe it's going to go up 100000 you're going to invest it in 99 and you're going to go it's going to go back to 97 you're going to lose so the same thing is the same thing of the dollars true of the bitcoin but for that banking person that person banking and africa or person banking in a developing nation there's there's plenty of systems in place and plenty of systems available that you can use you can do exactly that without using crypto currency there's plenty of remittances dms that don't use crypto currency all and actually all roman systems don't use crypto currency at all ok so we're in a position to say that this is a brand new technology that's up in the world but it's not being used at all nobody is using it ok gary holman in london on that idea of it's

a brand new technology that's not being used properly that that john was talking about that doesn't need to be regulated and that's a problem because governments financial ministers around the world don't really get it in as much as with all due respect to you 3 there is little or no moral compass in the world of stocks and she is hopefully there's a big moral compass in the world of politics and it needs to be regulated. if only because a guy called gerald cotton a canadian died in 2018 and he in effect took $250000000.00 of other people's money to the grave with him because all their invested money was password protected and hello he was the only guy who had the password right so yeah there's a lot of things to say there. you know 1st this is regulated currently and in part of the story 2020 is is there's been much greater regulatory

clarity around purdue assets particularly the united states and that's helped get institutional investors and banks more comfortable banking crypto and crypto companies and supporting customers the growing us to mate roughly between 50 and 100000000 owners of crypto assets like that point today globally you know so it's still you know not a 1000000000 users like what's app for another major tech platform but it's growing significantly. but your points it's fair and look i mean i think people listening to senior standing up to assets have historically been quite volatile you know in march of last year we saw the price drop 50 percent in one day 2080 bequeaths price went down over the course irrationally 80 percent and that hasn't been that uncommon historically so so for people who are living kind of paycheck to paycheck or day to day you know they need to be aware of not only that volatility but also the complexity of using this technology it is a new technology there is

a learning curve there is a need to educate regulators as well as everyday folks who are not really adopters or that tech savvy companies like watching dot com are really hard to try to do that but it's a daily challenge you know it's not something that by any means we've mastered it's getting easier it's you know something that you know it's going to take years if not decades to kind of transition the world to this new financial re all financial infrastructure that laci technology could go assets represent ok let's go back to matthew gets in new york one thing that strikes me as being genuinely worrying over the past 3 months or so the bank of america seems to have adopted and that's a cheat that says and i quote the cryptocurrency blow the doors off pry up bubbles that seems like a big bank has a way of saying we just don't know and if a big bank or a big bank doesn't know surely that means the risks of just too great.

yeah as someone who came from one of those banks it's really interesting to observe you know the statements that are made at one point in time and how they transition capitulate change over time i think that may be a slightly hyperbolic way of saying we don't know how how big how high this is going to go and i think that's fair i think anyone who purports to know that. probably isn't someone that you should listen to. but i think what we have seen and this is a pattern that has repeated in every bull market and every cycle that the clinic cryptocurrency have gone through and it's now a 12 year history is you have a new wave of adoption a market participants come in that pushes the market up to a local bubble a local high ride that happened when because it went from $101.00 to $100.00 and

then it consolidated right and then it went back up and it got to $100.00 and people said well bank of america is saying now ok and what it wouldn't do it went to $1300.00 ok so if you want to push you that such i just want to put one final point very briefly to john biggs joan in new york in 30 seconds the reality is somebody watching this discussion might say oh i'm going to put $20000.00 u.s. dollars into bitcoin but the reality is the same with this as with any other investment you should only invest surely john what you can afford to lose this may be a virtual currency but however it is really taxable so if you make a profit on it you still got to pay tax on that. it's currently taxable and if you buy 20000 and you don't keep it on online wallet like blocks and you put it in a hardware wallet and you have to understand exactly what you do and you become your own bank and it's actually fairly difficult to do all this stuff and you can be hacked instantaneously so any time you deal with this stuff it's very dangerous that's why i don't like to recommend it right now because it's just they they say

that the rails are the rails are brand new they're 12 years old i think what's apps 12 years old it's even probably even younger and i can i can send a message pretty quickly it's a it's surely frustrating to hear the same story from these guys over and over again you can be hacked instantaneously that's genuinely frightening gentlemen thank you very much for joining us here on inside story thank you to our guests they were matthew gets heilman and john biggs and thank you too for watching you can see the program again any time via the website al-jazeera dot com and for further discussion go to our facebook page that's facebook dot com forward slash a.j. inside story you can also join the conversation on twitter at inside story for me and the team here in doha thanks for watching we will see you very soon for the moment.

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