Bitcoin has gotten a significant amount of attention as it broke through several barriers over the past few weeks, recently rising above $7000 like it’s nobody’s business.
Among the people watching its evolution over time, we can include Severin Cabannes— the CEO of Société Générale, one of the largest and oldest banks in France—who spoke about Bitcoin in the context of these events during an interview with Bloomberg last Friday.
“It’s fair to say that Bitcoin, today, is in my view, clearly in a bubble. But we don’t know very well what are the market drivers behind this price evolution,” he said.
These comments came in the middle of an upsurge in cryptocurrency’s valuation, which was only bolstered by the fact that CME Group just recently announced that it would introduce Bitcoin futures.
“It has not reached its growth limit; the pyramid has not yet inflated so much as to burst. It will be pumped more and more... The price could double or even triple, it may even rise to $20,000,” said Aksakov.
Since the subprime lending crisis, banks have attempted to steer clear of any highly-speculative and risky investments. Rather than looking at Bitcoin directly, we’ve seen financial institutions take an interest in the cryptocurrency’s spinal chord—the blockchain.
“We are very interested, not in Bitcoin but in blockchain. […] We are not very keen to invest in Bitcoin, but we are very keen to invest in blockchain technology,” said Cabannes.
Banks find the idea of a distributed ledger appealing since it would rid them of most of the burdens they currently experience when processing cross-border transactions. By lowering their international fees to their customers, they can be more competitive.
While Bitcoin is worthless to most traditional banks, it’s much sexier “under the hood”. Blockchains have aroused their curiosity as well as the intrigue of other institutions which see their potential in helping them administer themselves more efficiently.