Source: Zhitong Finance

Brad Garlinghouse (Brad Garlinghouse), CEO of blockchain startup Ripple (Ripple), believes that the overall cryptocurrency market is expected to double in size this year, and the total market capitalization will exceed $5 trillion.

Garlinghouse listed a number of macro factors, including the arrival of the first spot Bitcoin exchange-traded fund (ETF) in the US and the upcoming Bitcoin “halving” event.

He said, “I've been in the industry for a long time and have seen trends come and go. I am very optimistic about this. Macro trends such as ETFs will drive real institutional funding for the first time.” “You'll see this driving demand while supply is shrinking at the same time. It doesn't take an economics major to understand what happens when supply shrinks and demand expands.”

On January 10, the US Securities and Exchange Commission (SEC) approved the first batch of US spot Bitcoin ETFs. Since then, through the US stock exchange, institutional and retail investors have gained exposure to Bitcoin without directly owning the underlying assets.

Meanwhile, Bitcoin halving is a technical event that occurs approximately every four years in Bitcoin's history, and the mining rewards Bitcoin miners receive will be cut in half. Bitcoin miners are volunteers on the Bitcoin network who use high-powered computers to verify transactions and mint new tokens. The last halving occurred in 2020, and the next one will be later this month.

“(Due to) all of these macro factors affecting the cryptocurrency industry, the overall market value of the industry is expected to easily double by the end of this year.” Garlinghouse said. As of April 4, the total cryptocurrency market capitalization was around $2.6 trillion. If the market doubles in size, this means that the total market value of new cryptocurrencies will reach $5.2 trillion.

Bitcoin has been the main token driving the rise in the crypto market, rising more than 140% over the past 12 months. Bitcoin hit a record high of over $73,000 on March 13, according to CoinGecko data. Since then, however, Bitcoin has fallen far below the $70,000 level. As of April 1, Bitcoin accounted for about 49% of the entire cryptocurrency market, with a market capitalization of $1.3 trillion.

US cryptocurrency regulation may now show positive signs

Garlinghouse believes that one of the other factors driving the cryptocurrency market to new highs is a possible positive regulatory momentum in the US. This year is an election year, and investors who are optimistic about cryptocurrencies are optimistic that the next administration's policy focus will be more beneficial to the cryptocurrency industry.

Under Chairman Gary Gensler (Gary Gensler), the SEC has always been active in enforcing cryptocurrency companies (including Ripple itself). The SEC filed a securities lawsuit against Ripple, accusing it of illegally selling XRP, a cryptocurrency closely linked to Ripple in an unregistered securities transaction. Ripple has denied the allegation and is appealing.

“Actually, one of the things I want to talk about is the macroeconomic benefits of the industry: I think the situation in the US would be more clear,” Garlinghouse said. “The US is still the largest economy in the world, but unfortunately it has always been one of the countries that are more hostile to the cryptocurrency market. I think that will also begin to change.”

Garlinghouse isn't the only big name in the industry predicting huge returns in the cryptocurrency market this year. Marshall Beard (Marshall Beard), the chief operating officer of the US cryptocurrency exchange Gemini, recently told foreign media at an industry conference in London that the price of Bitcoin is expected to rise to $150,000 later this year.

“Everything has risen so fast this year, lots of activity, new regulations, ETFs, halving, miners that need to quit.” Beard said in an interview, “The cryptocurrency market will fluctuate drastically up and down to a record high. I think this high will be $150,000, which is likely to happen this year. These trends in the industry, supply shocks, etc. are all developing too fast.”