(FinancialPress) — A burst in the theoretical Bitcoin bubble has financial analysts wary of significant “collateral damage,“ which could not be limited only to the cryptocurrency industry.
As a follow up to JPMorgan‘s CEO Jamie Dimon infamously putting the popular cryptocurrency on blast, stating “If you were in Venezuela or Ecuador or North Korea or a bunch of parts like that, or if you were a drug dealer, a murderer, stuff like that, you are better off doing it in Bitcoin than US dollars… so there may be a market for that, but it’d be a limited market.”, The Wall Street Journal quoted various commentators in a feature released over the weekend.
The idea that the cryptocurrency, Bitcoin and blockchain trend is a 90‘s-styled bubble is popular among financial traditionalists.
“What we’re looking at is a new technology that people are still trying to understand,”stated Digital Asset Research senior analyst Matthew Gertler.
Joe Kinahan, chief market strategist at broker Ameritrade said: “Anybody getting more than five percent of their business from crypto, it’s starting to become significant, and you could see their stock prices very quickly collapse. Companies who are relying on it for business, and those who have put a significant investment into the [blockchain]infrastructure would be the first”
“…any product that blows up, there’s always collateral damage.”
The risk is placed mostly on companies that are profiting directly from the blockchain cryptocurrency phenomenal boom. Companies such as Nvidia, which have seen a spike in performance due to their products being used for cryptocurrency mining, would be directly affected by a crash.
However, since companies such as the one mentioned formally participate in the commercial market, suitable risk mitigation is viable with the possibility of repositioning itself in the market if mining activity shifts, as per a previous Cointelegraph report.