The article below was written by Damanick Dantes, an independent global macro trader at Dantes Outlook LLC, specializing in commodities. He earned a Bachelor of Science in economics and finance from Babson College. The article was published on coindesk.com on April 16, 2021.
A lot has been said and written about Bitcoin and the cryptocurrency market. Like anything new, the first reaction was to fear it before those in a position of power were able to conduct their own due diligence.
There was a lot of F.U.D. (Fear, Uncertainty, and Doubt) put out by those who are profiting the most from Bitcoin and other cryptocurrencies today!
Bitcoin Has Gone from Being A Fraud to a Bubble, and Now A Store of Value!
Has Bitcoin and cryptocurrencies as an asset class really been accepted by the financial industry?
Well, you have banks and financial institutions holding Bitcoins and other cryptocurrencies on their books and now a Fed President saying Bitcoin “Is A Store of Value,” why are you still sitting on the sidelines?
It is the store of value that has so many in the financial industry buying bitcoin and holding it instead of trading it to create instant cash flow!
By holding or HODLING Bitcoin, the price has somewhat stabilized and has led to the recent increase in the value of Bitcoin.
As Bitcoin goes up and down in value, so does the rest of the cryptocurrency market!
Unfortunately, those in a position of power; Government Regulators, Bankers, and Financial Institution leaders seem to think that only their high-net-worth individuals are ready to participate in cryptocurrencies like Bitcoin because of the volatility.
START YOUR CRYPTOCURRENCY EDUCATION TODAY!
Considering there are over seven billion people on earth, only about 100 million have skin in the game when it comes to Bitcoin and cryptocurrencies.
However, that is changing as more regulations come out that allow banks and financial institutions to have Bitcoin and other cryptocurrencies on their balance sheets.
As banks and financial institutions are allocating a percentage of their Assets Under Management to Bitcoin and other cryptocurrencies, this has allowed billions of dollars to flow into the cryptocurrency market.
YOU DO NOT NEED BILLIONS TO GET INTO THE CRYPTOCURRENCY MARKET!
Small, consistent investments can allow you to start accumulating Bitcoin and other cryptocurrencies today.
Some in the cryptocurrency industry estimate that holding a quarter (025) of a Bitcoin could possibly make you a millionaire in the future.
Do not wait until your government, banker, or financial institution leader tells you it is now safe to invest your money in Bitcoin and other cryptocurrencies, but then, the wealthy will have capitalized on the transfer of wealth that the cryptocurrency industry is creating.
As always, conduct your own due diligence so that you make an educated decision instead of one based on emotions.
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DISCLAIMER: I am not a financial advisor, planner, or CPA, and I am not giving anyone investing advice, I am just sharing information I know and use in my own decision-making about cryptocurrencies. If you need financial advice, please seek the advice and guidance of a licensed financial advisor, planner, or CPA with knowledge of cryptocurrencies.
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Bitcoin Is ‘Store of Value’ Though Not Yet ‘Medium of Exchange,’ Dallas Fed’s Kaplan Says
The U.S. economy is “not out of the woods yet,” said Dallas Fed President Robert Kaplan.
Federal Reserve Bank of Dallas President Robert Kaplan(Federal Reserve Bank of Dallas, modified by CoinDesk)
Apr 16, 2021 at 2:40 p.m. EDT Updated Apr 16, 2021 at 3:00 p.m. EDT
Federal Reserve Bank of Dallas President Robert Kaplan said bitcoin (BTC, +1.94%) is a “store of value” that’s not yet ready for wider adoption as a medium of exchange.
Kaplan, a former Goldman Sachs, and Harvard Business School professor, made the remarks Friday at a bitcoin conference hosted by Texas A&M University’s Mays Business School. He served on the Federal Reserve’s monetary policy committee, the Federal Open Market Committee, before rotating off at the end of 2020.
“Right now it’s clear it’s a store of value,” Kaplan said of the largest cryptocurrency. “It obviously moves a lot in value, which could keep it from spreading too far as a medium of exchange and wide adoption, but that can change.”
Lately, that movement has been up, in dollar terms. The price of bitcoin (BTC) has increased eightfold over the past year, to about $61,400 as of press time, for a market capitalization of about $1.1 trillion.
A growing number of big investors, including legendary hedge fund managers Paul Tudor Jones and Stanley Druckenmiller, have said bitcoin might serve as an effective hedge against inflation in the face of trillions of dollars of coronavirus-related monetary stimulus by the Federal Reserve.
An alternative perspective would be that the U.S. dollar has lost nearly 90% of its value when expressed in bitcoin terms.
- “This is an innovation, and it’s not just bitcoin but the technology like blockchain and other technologies that go along with it,” Kaplan.
- The U.S. economy is “not out of the woods yet,” he said, adding that signs of inflation this year are due to supply and demand imbalances.
- “The question is, will this be a one-time price adjustment, or is it going to be persistent?” Kaplan said. “The jury is still out on that. Structural forces such as tech-enabled disruptions and aging limit pricing power.”
- When asked about China’s plans to launch a central bank digital currency (CBDC), Kaplan said that “the China experiment is tied to the value of the underlying currency. In some cases, you could argue it’s a way to monitor flows.”
- A “digital dollar will likely be tied to the value of the underlying currency,” Kaplan said. “It’s a different subject than bitcoin, a store of value that is not tied to an underlying currency.”