Bitcoin sits roughly 50% below its all-time high of $126,279 set last October. Prices dipped near $63,000 this week after briefly crossing $65,000. Exchange-traded products tied to it have shed value. Yet one veteran observer sees echoes of another technology that once felt clunky and incomplete.
David LaValle, president of indices and data at CoinDesk, draws the parallel directly. When he first picked up a smartphone, he didn’t dismiss it because it couldn’t summon a taxi on demand. He marveled at the simpler wins. No more lugging an MP3 player alongside a separate cellphone. The device solved immediate problems. Bigger changes arrived later.
“When I got my first smartphone, which is a great example of a disruptive technology that has been incorporated into my life, I didn’t get the smartphone and say, ‘This thing is garbage because I can’t get a taxi in front of my home whenever I want it.’ I was very excited that I didn’t have to carry an MP3 player and my cellphone at the same time,” LaValle told CNBC’s “ETF Edge.” (CNBC)
His point lands with force. Early criticism of Bitcoin fixates on what it cannot yet do perfectly. Volatility persists. Regulatory questions linger. Real-world payments still stumble in many places. Those gaps matter. They don’t erase the foundational shift already underway.
Consider the numbers. Bitcoin-related exchange-traded products have seen meaningful flows even through recent weakness. The iShares Bitcoin Trust ETF attracted buyers during the initial downdraft, according to Todd Rosenbluth, head of research at TMX VettaFi. A survey of 104 financial advisors found about half watching from the sidelines while 22% hold active positions. Not universal enthusiasm. But hardly the abandonment some headlines suggest.
LaValle describes the current stretch as different from past crypto downturns. “Unlike previous crypto winters, this is like, ‘Hey, when do I get back in as opposed to whether or not there’s a future.’ We look at this as a point of credibility.” The infrastructure has matured. Institutional channels exist. The conversation has moved.
Early innings still define the contest.
LaValle calls bitcoin-related ETPs a story of early innings. The products only launched in recent years. Spot Bitcoin ETFs arrived even later. Adoption curves rarely look smooth at the start. Smartphones didn’t instantly replace every feature phone or flip switch on mobile data networks. Carriers upgraded slowly. Apps emerged gradually. Battery life frustrated users for years. Yet the core idea — a computer in your pocket — took hold.
Bitcoin offers a similar proposition. It functions as digital money without a central issuer. Transfers cross borders with minimal friction compared with legacy rails. Its supply schedule remains fixed and transparent, a feature no government currency matches. Those properties attracted initial buyers. They now draw pension funds, endowments and public companies adding it to balance sheets.
Recent market data shows resilience beneath the surface. Despite a nearly 2% drop over the holiday week and steep declines from peak levels, certain holders stayed put. Rosenbluth noted that investors continued to hold and even buy shares of the iShares product through early weakness. “People were still holding on, and in fact buying IBIT through the initial downdraft. That’s encouraging to me.” A pullback creates opportunity for some. For others it confirms their hesitation. Both reactions fit the pattern of any new asset class.
Look further back and the analogy sharpens. A 2015 Wall Street Journal article described Bitcoin as one of the most powerful innovations in finance in 500 years. It highlighted potential to slash trillions in fees, automate back-office functions and open access for billions outside traditional banking. Those claims sounded bold at the time. Parts have materialized. Lightning Network payments, though still niche, demonstrate faster and cheaper transfers. Custodial solutions have improved. Corporate treasuries now treat Bitcoin as a reserve asset. (The Wall Street Journal)
Yet challenges remain stark. Scalability questions dog the base layer. Energy consumption draws scrutiny even as mining shifts toward renewables. Many users still rely on centralized exchanges, undermining the decentralized promise. And nation-state adoption stays uneven. El Salvador made Bitcoin legal tender. Most governments watch warily or impose restrictions.
And here’s where the smartphone comparison reveals its limits and its strength. The phone succeeded because it rode existing networks while creating new ones. Bitcoin must build its own rails while competing against entrenched financial systems that benefit from regulation, insurance and centuries of trust. Progress happens. But slower than enthusiasts predict. Faster than skeptics admit.
Recent coverage underscores the tension. A CoinDesk report from earlier this year noted Mexican billionaire Ricardo Salinas Pliego keeps 70% of his portfolio in Bitcoin, arguing it outperforms real estate. That conviction echoes among certain high-net-worth investors even amid price swings. (CoinDesk)
Meanwhile, a May 2026 report from security.org found Bitcoin ownership steady at 74% among crypto holders in the United States, maintaining its lead over Ethereum, Dogecoin and Solana. Adoption hasn’t collapsed. It has plateaued in some segments while deepening in others. (Security.org)
Price forecasts for the remainder of 2026 vary. Some analysts eye $70,000 to $90,000 ranges if ETF flows stabilize and macroeconomic conditions improve. Others warn of further pressure from outflows, with May 2026 marking the largest monthly redemption for spot Bitcoin ETFs since their inception. The data conflicts because the asset still trades on narrative as much as fundamentals.
But narratives evolve. Early smartphone buyers didn’t demand perfect mapping or ride-sharing on day one. They valued portability and basic connectivity. Bitcoin holders today value censorship resistance, portability of wealth and a hedge against monetary expansion. Those uses cases have real adherents in regions with unstable currencies or capital controls.
Projects like Machankura demonstrate the point. The service lets users in several African countries send and receive Bitcoin using basic feature phones and text messages, bypassing the need for smartphones or constant internet. It targets precisely the populations that legacy finance often ignores. (CoinDesk)
So Bitcoin doesn’t need to replace every payment method tomorrow. It needs to solve specific problems better than alternatives in targeted contexts. Remittances. Savings in inflationary environments. Settlement between parties that don’t trust each other. Each beachhead expands the addressable market.
LaValle’s optimism rests on that incremental logic. The technology has survived multiple supposed death knells. It has attracted sophisticated capital. Its core code has proven remarkably resilient. Improvements in layer-two solutions and custody options continue. The “when do I get back in” question from investors signals a maturing mindset.
Critics will counter that comparisons to the smartphone overstate the case. Phones improved daily life for billions within a decade. Bitcoin’s impact so far feels narrower. Fair observation. The analogy isn’t perfect. It simply illustrates that transformative technologies often look disappointing at first. They improve in fits and starts. Early judgments based on incomplete functionality miss the larger arc.
Markets reflect that uncertainty. Bitcoin’s price action this year has been choppy. ETF flows turned negative in May. Advisors remain divided. None of those facts disprove long-term potential. They describe the messy middle where most innovations spend considerable time.
Watch for three signals in coming quarters. First, sustained ETF inflows or at least stabilization. Second, measurable growth in on-chain activity beyond speculation. Third, clearer regulatory frameworks in major jurisdictions that reduce uncertainty without stifling development. Any two of those could shift sentiment meaningfully.
LaValle and Rosenbluth don’t claim victory is assured. They argue the funeral is premature. Bitcoin has earned a seat at the table. Its future depends on execution, not hype. The smartphone didn’t arrive fully formed either. It required ecosystem support, hardware advances and software innovation. Bitcoin travels a comparable road. Bumpy. Unpredictable. But far from over.
The comparison invites skepticism. Good. Every serious technology faces it. The test comes in whether the underlying value proposition compounds over time. For Bitcoin, that proposition centers on scarce, portable, verifiable digital value. Early evidence suggests demand exists. The question is how widely and how deeply it spreads.
Investors weighing exposure face the same dilemma early smartphone adopters did. Buy the vision and tolerate the flaws. Or wait for more polish and risk missing the ascent. History shows both strategies can work. Timing rarely looks obvious in the moment.
One thing seems clear. Dismissing Bitcoin outright because it hasn’t delivered every promised use case yet repeats the exact error LaValle warns against. The taxi didn’t arrive on day one. The music player consolidation did. Sometimes the small victories point toward larger ones still ahead.
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