Bitcoin dominance has dropped 8.5% since May 7 when Paul Tudor Jones announced that his company is investing in BTC.
Since early 2016 when bitcoin’s dominance was at 98.98%, it has fallen more than 38%. And according to Binance co-founder and CEO Changpeng Zhao, it will continue to fall.
“I think bitcoin’s dominance over time will decrease,” though it may increase in the short term, said CZ in a recent interview.
This is because although there’s a lot of innovations people can bring back on bitcoin such as the second layer of solutions when technology is out already and is adopted for 10 years, there’s relatively more limited scope for an update, he said.
He explained how we saw it with almost every technology such as software and programming languages. Whether it’s the internet, browsers, search engines, or social networks, no one is using the original ones.
Also, “nothing lasts forever,” as the companies like IBM and Microsoft, that were once strong, are no longer the biggest and most valuable firms. Although they are still big.
“If you look at 10, 20, 50 years later I think it’s totally conceivable that something new will replace bitcoin,” said CZ.
He doesn’t think we will lose bitcoin as it has already passed the “limited test” or move back into fiat but “something better than bitcoin” will come along and “people always invest in things that are new and better.”
Well, the crypto market has found its new shiny toy in the form of DeFi (decentralized finance) which CZ is a “very strong proponent,” along with staking. These latest things he believes will “increase adoption of crypto” but at the same time warns that this new stuff will have “very inherent high risk.”
Also, according to him, an “overwhelmingly large proportion” of the DeFi projects will fail and only a handful will survive.
During his interview, CZ also touched upon the bitcoin Segwit addresses implementation on the exchange which Binance “definitely” wants to add Segwit.
They are working on it, but segwit support requires a lot of customizations — “pretty much have to rewrite the wallet ourselves” as such, it will take time.
“I don’t know exactly when but we’ll get there sooner or later but it won’t be too soon,” he said.