The recent turmoil in the banking sector has shown that bitcoin (BTC) and ether (ETH) can withstand a shaky economy, outperform other asset classes and perform like gold, says Cathie Wood, managing director of ARK Invest — although a longtime investor still does. not sold.
Wood explained in an April 15 interview that Bitcoin’s resilience during the recent banking crisis was “the most notable” of all the indicators her tech-focused investment management firm monitors.
Bitcoin and Ether are now functioning as “low-risk” assets and a “flight to safety” for investors amid macroeconomic uncertainty, she claimed:
“They will disrupt the traditional world order. What are Bitcoin and Ether doing? I mean just the fact that they are viewed as a flight to safety like gold is really interesting and suggests a much broader acceptance and acceptance than I think most people understand.”
“We would say there is a flight to safety, certainly led by crypto assets, and it is telling us that the world is changing and will continue to change. You can’t stop innovation,” she added.
Wood believes that cryptocurrency will eventually become a “hot topic” as the sector gains broader acceptance and the public can more clearly see the kind of regulatory pressures the US government is putting on the industry to remove centralized control over money and cryptocurrency maintain monetary policy.
Not everyone shares Wood’s opinion.
Ray Dalio, founder of Bridgewater Associates, the world’s largest hedge fund by assets under management, explained in an April 12 interview that Bitcoin cannot serve as an “effective currency” because it is too volatile and central banks will not adopt it:
“Bitcoin is neither an effective store of wealth nor a medium of exchange, so it is not an effective currency. It has a volatility unrelated to virtually anything […] it’s a very, very bad alternative to gold.”
“You can ban [Bitcoin]. You can regulate it. Central banks and countries don’t want it anyway,” he said, adding that it draws attention “out of proportion” compared to its size.
Related: Bitcoin Likely To Outperform All Crypto Assets After Banking Crisis, Analyst Says
Dalio reiterated his point by noting that gold is central banks’ third largest reserve, behind only the US dollar and the euro.
Despite previously calling Bitcoin “one hell of an invention,” Dalio recently stated that he instead wanted to build an “inflation-linked” coin that would serve to ensure consumers secured their purchasing power.
Magazine: Unstablecoins: Depegging, bank runs and other risks loom
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.