The chief investment officer of crypto asset management firm Bitwise says that Bitcoin (BTC) will be hit with an unexpected crisis.
In a new interview on the Insightful Investor YouTube channel, Bitwise CIO Matt Hougan says that the crypto king is now stable enough to be considered a store of value, much like gold.
According to Hougan, assets that are stores of value tend to follow a pattern – one that sees their volatility diminish over time as their price increases.
“I would argue that [Bitcoin] has gotten to the point where it’s sufficiently stable to be used as a store of value. If you look since Covid, the US dollar has lost 25% of its total value.
Bitcoin is up something like 800%. It’s a pretty good store of value. People forget that even gold itself is pretty volatile. Bitcoin is slightly more volatile than gold – that means you have more upside…
Investing in Bitcoin will be pretty boring [like gold] but it has to follow this journey. You can’t create a store of value that emerges from nothing and is instantaneously stable, it’s just logically impossible. It has to follow the journey that it is on, which is declining volatility and increasing price, and I think that will persist into the future.”
Hougan goes on to note that since BTC’s price is in real time, investors feel the volatile nature of the asset more so than other investments, including times when unexpected crises occur.
“I have a high degree of confidence on where Bitcoin is going eventually but I actually don’t know how fast it will get there. What happens in the US election will influence how fast Bitcoin gets there.
What people do in terms of debt and deficits will influence how fast it gets there. Unexpected crises will influence [it[, so as you have these developments happen or not happen, it influences the price of Bitcoin.
If this were an early-stage technology company, like a Series A Technology company, but being priced in real-time, we would see the same kind of volatility. It’s just an early investment. The difference is, it prices in real time so you experience that volatility.”
Bitcoin is trading for $59,084 at time of writing. a 4.5% decrease during the last 24 hours.
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