From speculation to safe haven. What has changed?

Cryptocurrencies, Bitcoin: More or less of all, they’ve at least heard of it now. What are the first mental associations that are usually formed when hearing or reading these two words? In addition to being single virtual currencyPerhaps one of the first observations that comes to mind is: highly speculative tools, Given the fluctuations that have occurred over time (also very positively, of course).

However, in the past few weeks, after The conflict between Russia and Ukraine And with markets grappling with fears because of inflation growthAnd CryptocurrencyAccording to many, they seem to have become so safe haven assets.

We read from the site cryptonomist.chSome considerations after a post made to your Twitter profile by Elon Musk:

“….. This is the debate that has been raging among many analysts in recent months: Can Bitcoin protect against inflation? Definitely a deflationary BTC policy: The amount of BTC that can be mined at any time remains at 21,000,000 coins, So that should lead to an increase in price due to limited availability.”

Returning to the words of Elon Musk, the site mentioned the meaning of his idea

“The American businessman recently revealed assets that he believes are worth holding, especially in times of high inflation. Elon Musk is holding his holdings in cryptocurrencies that mainly include Bitcoin.”

Bitcoin: what are they?

What exactly are we talking about when we refer to it BTC?

In short, yes It is a virtual reality that does not exist physically and is not governed or controlled by the central banks of individual countries. Through a technique called blockchainThis, in fact, this tool independent of the banking system, was created as of 2009.

If at first it was possible to have the function of an alternative tool in digital payments, then its function, over time, certainly became more important, to the point that, for example, the case El Salvador He made it legal tender since last September.

Of course, it is a unique and exceptional case, but it A symptom of a strong growth trend From the cryptocurrency market (and Bitcoin in particular).

Prevalence rarity and value variability, plusThere is no organized marketHowever, make it a gray area, many, although attracted to the idea, prefer to stay away. However, others, realizing the news of easy profits, jumped without a parachute and ended up getting hurt badly.

Bitcoin: price trend

To get an idea of ​​what’s going on in Bitcoin market With particular reference to quotes, we take a cue from what is published on the site

“After crashing from an all-time high in November, BTC reached $32,000 in January. Slowly, BTC got back on the right track and managed to briefly rise above $45,000 (and over €40,000).”

give her The outbreak of the conflict between Russia and UkraineList BTC It has remained fairly stable and that in itself is news that can be evaluated positively. Of course, it is also necessary to take into account the path you took quotes itin just under two years, or from the beginning of 2020 to November 2021, They went from just over $7,000 to over $60,000 in November of last year. Racing fully highlights its reputation as a highly speculative investment.

And this is exactly the main problem: Every investment should always be approached in the right way, keeping in mind the potential risks that are triggered. We shouldn’t follow the fashions of the moment or throw yourself headlong into the hopes of making a fuss as if the number “6” in the Superenalotto was made. Not only is it recommended to invest your savings consciously and with the purpose of proper financial planning (with careful and targeted portfolio diversification), but it is definitely mandatory.

Bitcoin: Warning

Precisely the risk is drifting behind enthusiasm and not evaluating all aspects of an investment. This applies to any type of market, not just cryptocurrencies.

As an article published on the site clearly shows

“Cryptocurrencies have reached an incredible level of popularity and are still a very profitable digital investment tool. The result is that more and more people, even inexperienced people, are approaching this world, impressed by the apparent ease of making a profit. The problem is that despite taking Major Steps in Regulation With ETFs agreeing to bitcoin futures, the cryptocurrency market remains highly unregulated.”

What often motivates you to do or not do something is irrationality Inherent in man. Combined with emotion, it can produce disastrous (or miraculous, in the case of particularly favorable circumstances) results.

This is why it is always necessary to have Strong nerves and above all clear prospects and goals.

Bitcoin: investing without buying it

Possibility Invest in BTC without buying it. It might seem like an unreal thing, but it is.

As the site reports

“Now, the possibility has arrived for small savers to invest in bitcoin without buying it directly. We are not referring to ETFs, passively managed funds that have already emerged in developed realities like Canada. It is the volcano bond of El Salvador, the unique country in the world that has adopted bitcoin as legal tender. since last September.

chest with a Minimum denomination $100, they will pay a 6.5% coupon per annum, plus a possible revaluation due to the particularity of investing the money raised starting from the sixth year.

Thus, one can invest in BTC without directly buying BTC. Could this be a great idea? Perhaps, as long as you are willing to take the risks involved. Which?

First of all, the so-called The credit risk of the issuer, El Salvador, is classified as “junk.”“From the major rating agencies. This is why the bond issue recognizes such a high rate of interest compared to market standards. This should clarify the degree of investment risk.”

As the trend is also partly related to BTC price volatilityif the prices of the same thing should go down rather than increase, there is There is a great danger, for El Salvador, that it will in any case find itself unable to repay those who have signed the bond..

Bitcoin: a safe haven in Russia

at Russia, BTC, at this historical point, has become a safe haven asset. what are the reasons?

The answer is much simpler than you might think: An economic system is collapsing, the absence of the dollar, gold and government bonds issued by the US Treasury. what’s left? Cryptocurrency.

A bit of strength and a little bit of inertia, BTC has become a safe haven in this economy that, due to the ongoing conflict, is likely to suffer other heavy repercussions.

What are the practical reasons? in the first place, Unlike gold, it does not need what is called a storage place for its preservation. Unlike bonds, it does not require the deposit of securities with the bank. Unlike a currency, BTC does not need a place where it is physically stored.

BTCBeing a virtual reality, It does not require any tools other than a simple mobile phone. So, in giving a very first thought, we understand how, in practice, it is the only possibility, the only safe haven available to everyone.

Bitcoin: Fear Makes 90

In these economic times, the hardest part is being able to keep your nerve. Haste is always a bad advisor, but the unknowns, unfortunately, are and are there. And they are not few. In addition to the conflict that has grabbed the headlines for a month now, there’s an even bigger risk creeping through the markets: inflation.

The danger is that the increase in inflation reaches higher-than-expected levels and could generate a negative vortex on different economies which, in series, will have an effect on the savings of Italians (and not only).

Therefore, it becomes categorically necessary that neither fear nor emotional state dominate for the moment. Even if being able to remain unaffected is certainly a difficult task.

also because The turmoil in the markets at the beginning of 2022 is not over yet. exactly the contrary.

At this point, do you want to hold on to BTC?

Bitcoin: a safe haven? The confusion is there

Keep Bitcoin as your new safe haven?

The confusion is all there and has its reasons for existence.

Indeed, Self On the one hand, in the last month, Bitcoin prices, unlike stock markets, have remained largely stable, and it is also true that the prices of the safe-haven asset par excellence, that is, gold, have remarkably grown again. The Swiss Franc (a safe haven for the other currency) and the US dollar have also partially done the same.

If Bitcoin is a safe haven, shouldn’t it act like gold? Shouldn’t he raise his prices? Obviously, there is no absolute exact answer.

However, there is an awareness of the fact that today Bitcoin is an investment vehicle to consider but may not yet mature (given its young age as well) to rise to the role of a safe haven in times of unfavorable economic conditions.

Financial insurance advisor, born in 1971.
An accountant diploma, without ever loving accounting, inCommercial Technical Institute Lb Alberti From Lucerna (to). Passionate about football and writing, Juventus and poetry are my big darlings. I have published four collections of poetry. The last, from the title De la petite mort à DieuHe personifies the transcendence of love in its psychophysical sense closest to God, that is, orgasm. Writing is my medicine: episodes of abstinence or rejection are two sides of the same coin.

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