A new report written by Francisco Blanch, who works as Bank of America Merrill Lynch's lead commodity and derivatives strategist argues that bitcoin will go mainstream only once banks start accepting it. The report outlines methods by which cryptocurrencies can be weighed against other commodities, singling out safety and liquidity as potential factors.
Mr. Blanch drew a comparison between bitcoin and commodities such as gold and silver. His note about volatility in the past year for silver is thought provoking.
"Bitcoin's volatility is very high compared to the euro, the yen or even gold," he wrote, according to CNBC. "But it fell twice last year below the volatility of silver, the world's currency for 400 years."
Mr. Blanch has an interesting opinion as it seems that he believes that when banks begin taking bitcoin as a form of collateral for products then and only then will cryptocurrencies be accepted by banks. He is correct when he writes that "we are not aware of any major institution that takes cryptocurrency as collateral at the moment."
*The report is not publicly available for view and I would personally love to see it. I read about this report here: https://www.coindesk.com/bank-america-analyst-bank-acceptance-crucial-hurdle-bitcoin/
Yet, with Ripple, the real life use cases for banks should be evident by now. It's being used by hundreds of banks around the world. To my knowledge, everyone involved in Ripple and XRP wants to maintain a stable price for the currency.
To quote their home page, "Ripple works with banks to transform how they send money around the world — a necessary step to compete in today’s growing economy. Our vision is to enable the Internet of Value so the world can move value the way it moves information today." https://www.ripple.com/
In my opinion not only is Ripple the product to ensure asset transfer is completed properly and quickly, it then becomes the commodity that Mr. Blanch is hedging against from a volatility standpoint.
Ripple is the future as it kills two birds with one stone...
