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RIYAD: The discovery of a new variant of the coronavirus, B.1.1.529, may have weighed on Bitcoin, the world’s largest digital currency, but financial experts expect its value to “double over the course of over the next 12 months ”.

The fall in the value of Bitcoin should be seen as a major buying opportunity, said Nigel Green, CEO and founder of deVere Group.

Bitcoin fell more than 9% on Friday, dragging smaller tokens down.

Bitcoin hit an all-time high of $ 69,000 earlier this month, as more and more big investors embraced cryptocurrencies, many drawn by its supposed inflation-resistant qualities.

Others have crammed into the digital token on the promise of quick wins, a drawdown that has been accentuated by record or negative interest rates.

“The discovery of a new variant of the coronavirus has rocked global stock markets as it brings a new wave of uncertainty,” Green said.

“The crypto markets have mirrored the reaction of other financial markets. This highlights how mainstream digital assets have become, as a growing number of institutional investors have crammed into Bitcoin this year.

“But for this reason, when they temporarily reduce exposure to most risky assets, despite the longer-term outlook, they also do the same with Bitcoin. In turn, due to Bitcoin’s gigantic market share, this weighs on the entire crypto industry, ”said the head of the fintech organization.

He continued, “However, I think this is a knee-jerk reaction from the crypto market. It will pass pretty quickly as it did with the delta variant in the summer.”

Bitcoin is often referred to as “digital gold” because, like the precious metal, it is a medium of exchange, a unit of account, non-sovereign, decentralized, rare and a store of value.

“In addition, investors will once again focus on growing fears of global inflation caused by lingering supply-side problems,” said the CEO of deVere.

Bitcoin is widely regarded as a shield against inflation, mainly due to its limited supply, which is not influenced by its price.

“This ‘inflation shield’ will continue to bring growing investment into the crypto market from major institutional investors, bringing with them capital, expertise and reputation – and further driving up prices.”

Echoing similar sentiments, Martha Reyes, head of research at the BEQUANT stock exchange and digital asset brokerage, said: “News of a new variant of the coronavirus originating in South Africa has led to a massive sale in all asset classes.

“If lockdowns ensue, which is not our baseline scenario, it will lead to more helicopter money, which will ultimately benefit digital assets.”

Ruud Feltkamp’s point of view supports the opinions of both experts. The CEO of the cloud-based automated cryptocurrency trading bot Cryptohopper said, “Inflation is skyrocketing and people are looking for more alternatives for their money in the bank. I don’t think it will be long before investors see this as a “cheap” time to buy. We’re still in the middle of the bull cycle, and I think rising inflation will cause more money for stocks and crypto to rise. “


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