Is Bitcoin a safe-haven asset?
06 Aug 2019
As global financial markets reel from China’s devaluation of its currency in response to the growing tensions with the U.S., the price of Bitcoin has soared.
The world’s leading cryptocurrency is currently, at the time of writing, up 11% since the end of last week.
Many experts are now saying that this is because Bitcoin and other cryptocurrencies are viewed as safe-haven assets.
On Tuesday, Nigel Green, deVere CEO and founder noted: “Consensus is growing that Bitcoin is becoming a flight-to-safety asset during times of market uncertainty.
“The legitimate risks posed by the continuing trade dispute, China’s currency devaluation and other geopolitical issues, such as Brexit and its far-reaching associated challenges, will lead an increasing number of institutional and retail investors to diversify their portfolios and hedge against those risks by investing in crypto assets.”
The CEO of Circle, Jeremy Allaire, agrees. He told CNBC: “Humanity has now created a non-sovereign, highly secure mechanism to store value that can exist anywhere that the internet exists. It's uncensorable, it's unseizable.”
Speaking to Bloomberg, Brad Bechtel, head of foreign exchange at Jefferies LLC affirmed: “It definitely appears to be acting somewhat like a safe-haven…every time we see turbulence in the market and it starts to sell off, you see Bitcoin, and other safe-haven assets rally.”
Against a backdrop of growing geopolitical tensions including the U.S.-China trade war, Brexit, and protests in Hong Kong, amongst other issues, Nigel Green says that Bitcoin is likely to hit $15,000 within a few weeks.
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