Ruchir Sharma says cryptocurrencies will remain an asset class

For a while, the outlook for cryptocurrencies looked bleak, with many naysayers predicting the bubble would burst. But investor and author Ruchir Sharma thinks a different story is emerging.

In an interview with India Today News Director Rahul Kanwal, Ruchir Sharma explained why cryptocurrencies, along with gold, are emerging as long-term alternatives to traditional assets, especially the US dollar.

Sharma put the situation into context, emphasizing that the search for an alternative to the US dollar is increasing. “People are looking for an alternative to the US dollar and they haven’t found it in other currencies because they face much bigger problems than America, whether it’s the Chinese currency or the euro.”

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As a result, both gold and cryptocurrencies like Bitcoin have become the default options for those seeking stability in uncertain times.

Sharma noted that many crypto enthusiasts once believed that Bitcoin could replace gold. Although Bitcoin performed well, gold was not left behind.

“Gold has performed as well or almost as well as crypto this year,” said Sharma, emphasizing that both assets are increasingly considered safe investments.

Looking to the future, Sharma confirmed that cryptocurrencies have proven their staying power. “Crypto is here to stay,” he said. “There’s a lot of speculative nonsense around the price, but as an asset class I think it’s here to stay.”

He explained that both gold and cryptocurrencies are likely to see increased allocation in investment portfolios over time.

However, not all predictions for cryptocurrencies came true. While crypto has remained resilient as an asset class, it has failed to gain significant traction as a medium of exchange.

“From what I’ve said so far, the only negative about crypto and Bitcoin is that a lot of people think it can be used for transactions. That’s not happening,” said Sharma.

Despite this, he believes cryptocurrencies will continue to be a vital part of the global financial landscape. Sharma’s perspective suggests that while cryptocurrencies have yet to revolutionize daily transactions, their role as a long-term alternative asset to the US dollar alongside gold is poised to grow.