Will Bitcoin Become a Safe Haven Asset?
Will Bitcoin Become a Safe Haven Asset?: CEO of Digital Currency Group Barry Silbert predicts that when the pound value declines, bond prices fall, and interest rates rise, bitcoin will replace other safe-haven assets as the preferred alternative.
Gold maximalist and bitcoin bear Peter Schiff thinks the U.S. stock markets will crash on September 27, 2022, with the S&P 500 falling by 1% by the end of the day and the tech-heavy Nasdaq falling by 0.6% on Monday due to increased reported yields on 10-year Treasury notes.
Bank of England
- The Federal Reserve will emulate its British counterpart. Introduce quantitative easing as a compliment.
- “The Bank of England already changed course. The BOA unveiled a new quantitative easing scheme to create pounds and buy gilts as plunging bond prices and increasing interest rates threatened a financial crisis.
- UK inflation will now reach record levels. Which central bank will make the next mistake? Hint: It rhymes with Ted,” tweeted Schiff.
- Schiff, often known as the “gold bug,” has been a vociferous opponent of bitcoin, arguing that gold is a superior safe-haven commodity that resists inflation.
- While Paul Krugman, a Nobel Prize-winning economist, disagrees with Schiff’s assertion that inflation is measured by the Consumer Price Index and instead prefers to use the Consumer Price Index as a proxy for inflation, his prediction of the 2008 financial crisis was accurate.
- According to Krugman, the Fed’s money-printing activities are not employed to settle government debt in a nation like Argentina but rather to maintain predictable annual price increases of approximately 2%. Thus, the impact of inflation in such nations is not comparable to that in the United States.
Still haven’t reached critical mass
- On the other hand, DCG CEO Barry Silbert tweeted that amid more significant macroeconomic unrest. The most prominent cryptocurrency in the world would emerge as the new haven asset.
- Early on September 27, 2022, bitcoin rose as the U.S. dollar momentarily declined before dropping with the S&P 500 to less than $19,000. At the time of publication, it is trading at roughly $19,000. Having recovered alongside the Dow Jones Industrial Average.
- While this indicates a rising correlation with equities, Anthony Scaramucci. CEO of SkyBridge Capital. Asserted earlier this year that bitcoin won’t become a hedge against inflation until one billion or more wallets are stored.
- Others, such as billionaire and co-founder of Gemini Tyler Winklevoss. Think that given the characteristics of bitcoin. It should behave differently from stocks and that any link between stocks and bitcoin is a product of bitcoin’s infancy as an asset class.
Also Read: Advice For Success in The Crypto Industry