Hedge for major drawdowns in equities, particularly to fiat currencies like the dollar which they seek to displace” notes “Crypto assets continue to rank as the poorest Of cryptocurrency ownership is raising correlations with cyclical assets. The diversification benefits remain questionable at current prices so far above production costs, while the mainstreaming risk-adjusted) terms drops to around $37,000. Volatilities), the fair value for bitcoin in risk capital (i.e. At the current bitcoin to gold volatility ratio of around four times (in terms of six-month So far the opposite is happening, with the volatility of bitcoin rising while Of bitcoin converging to that of gold, he said. Would likely be a multi-year process that would depend on far greater institutional Bitcoin ownership and on the volatility Mika Inkinen, Global Markets Strategist, added “We estimate the long-term theoreticalīitcoin price at $146,000 to match the total private sector investment in gold via ETFs or bars and coins.” Reaching this Panigirtzoglou estimated that, at $100 billion, the daily trading volume of gold in spot and futures is 10 times the true Some of this can be explained by low market liquidity. “Current prices are well above our most recent estimates of fair value based on mining cost and risk capitalĮquivalence with gold.” He observed that just $14 billion of institutional inflows into Bitcoin since September 2020 haveĬontributed to an $800 billion increase in its market cap. “Bitcoin has already surpassed gold in risk capital terms,” according to Nikolaos Panigirtzoglou, Senior Global Markets Concerns about cyberattacks, climateĬatastrophes and materially higher inflation also factor in, particularly with millennials, furthering demand for these Unconventional and high-volatility hedge has been driven by rich equity and credit valuations conventional hedges likeĭeveloped-market bonds barely serve as insurance at current low yields. The rise in Bitcoin’s acceptance as an alternative currency is another phenomenon of the COVID-19 era.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |