Is Bitcoin an asset value reserve? That is a question that crypto market analysts have tried to answer for years. A debate that has intensified before the advance of the coronavirus. At the same time that Bitcoin was going through one of its biggest bullish rallies of recent times. Making crypto influencer Brian Armstrong comment on the prospects of crypto market in today's Tweet:
The jump of Bitcoin to be a reserve of value
In recent weeks within the crypto community, there has been a debate about the quality of Bitcoin as an active reserve of value. Especially after a significant drop in its price at the time when the coronavirus began to expand outside of China. What, logically, should have attracted more investors to the crypto market and caused Bitcoin to increase its price.
However, the fact that another asset of value such as gold fell only a few days later was enough to restart the debate on the character of BTC. And therefore, on the consequences that the actions that governments take in the coming days will have on the cryptocurrency.
And, as we discussed in our Tweet yesterday. It is expected that in the coming weeks the financial authorities around the world will establish a stimulus plan, to prevent the economic paralysis generated by the coronavirus from translating into a global recession. Which implies greater monetary issuance and interest rate cuts. Thus motivating the series of tweets sent by Armstrong:
“A downward stock market and interest rate cuts can cause crypto growth this year. It is likely that governments around the world try to stimulate the economy in any way they can, including by expanding the money supply (printing money) and quantitative relaxation. ”
Thus, Armstrong would be aligned with Binance CEO Changpeng Zhao, for whom the expected monetary issue will only weaken fiat money, and take investors to cryptocurrencies to protect their capital. Given, therefore, the process commented by Armstrong: "This could be the year in which the mentality of institutional investors begins to change, from crypto as a risk bet, to crypto as a reserve currency."
Posted via Steemleo