Following some specific things that took place in the cryptocurrency landscape in the last few months, the price of Bitcoin, which is the most valuable digital asset, started to soar and leave behind months of a bearish market that caused lots of investors to sell their holdings.
The revival of institutional interest, the announcement of Facebook’s crypto project, and other developments have positively impacted on BTC’s price, which is now hovering around $11,700 on Thursday, August 8.
A Safe Asset
And experts in the industry, such as Rhythm Technologies’ chief marketing officer Chris Reinertsen, have recently stated that Bitcoin is now viewed as a safe asset for investors to protect themselves against possible uncertainties when it comes to their funds.
The concept goes a long way into people viewing BTC as a stable asset, rather than being scared of the alleged volatility that has been criticized for years. Specialists are continually making predictions that BTC’s value could surpass its all-time high of nearly $20,000 by the end of the year, with the potential for more.
In an interview with Forbes, Reinertsen observed that another crucial development, in this case, the trade pulse between the United States and China, have increased global uncertainty. That has driven a sizable group of investors to eradicate some of the risks associated with their holdings by acquiring BTC.
And, if many more investors are looking to acquire BTC assets, it will only mean positive things to its price outlook in the near and medium term. People are, more than ever, looking to make sure their cash doesn’t lose value if things go wrong and, therefore, are increasingly engaging in Bitcoin trading.
The yuan, the Chinese fiat currency, recently suffered a devaluation, reaching its lowest mark in the last eleven years when compared to the American dollar. In fear of losing valuable funds, Reinertsen said that investors are turning to BTC, afraid that Donald Trump’s actions (some of which triggered the previously mentioned devaluation) continue to escalate.
For years, Bitcoin was excluded from the “safe investments” list when people were considering hedging their funds. However, now the cryptocurrency is a receiving end of the flight of capital to safe-haven assets.
Some of the more traditional safe haven assets have been gold and the Swiss Franc. However, as BTC has been received the nickname “Gold 2.0,” people are starting to buy Bitcoin as a safety measure.
Reinertsen notes that Bitcoin’s involvement and direct relation to the planet’s macro moves has been one of the driving factors behind the paradigm shift, and because of that, people are now looking to fill their Bitcoin wallets.