Grayscale Investments has published a case study that describes the possibilities of using bitcoin as a hedging instrument in the face of financial instability, largely due to the trade war between the US and China.
In particular, the authors point to the significant potential of BTC as a means of maintaining value and a payment instrument that can manifest itself in full against the background of the usual cyclical fluctuations of the economy, and during periods of liquidity crisis.
Analysts conclude that the first cryptocurrency deserves to be an important component of many long-term investment portfolios. Confirmation of this thesis is the growth of bitcoin as the escalation of the trade war and amid the decline in many traditional assets.
A similar point of view is shared by Brian Kelly, founder of the BKCM cryptocurrency hedge fund.
Why is Bitcoin suddenly tracking gold? @BKBrianKelly breaks it down: #btc pic.twitter.com/UkAqEX8Zi4
– Squawk Box (@SquawkCNBC) August 8, 2019
In a conversation with CNBC, he said that traditional investors often see bitcoin as an alternative to gold, using cryptocurrency to hedge macroeconomic risks. Kelly added that this year could be a turning point for the perception of bitcoin in the global financial space.
On the other hand, like the strategist of BMO Capital Markets investment bank Brian Belsky , Kelly did not rank BTC as a defensive asset due to the extremely high cryptocurrency volatility compared to the S&P index.
Recall that immediately after the Fed cuts and the US announced new duties on Chinese goods, bitcoin, gold, the Japanese yen, the Swiss franc and 10-year US Treasury bonds almost simultaneously increased in price .
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