Bitcoin as a store of value_ part 2 – by david young


Prior to catching up on where we stand currently, let’s review a definition of the term Store of Value so we clearly understand the intent here. Today’s futures market This is how Wikipedia defines Store of Value:

A store of value is the function of an asset that can be saved, retrieved and exchanged at a later time, and be predictably useful when retrieved. Cad usd exchange rate The most common store of value in modern times has been money, currency, or a commodity like gold, or financial capital.

The definition of Store of Value as a function is certainly easy enough to understand, but let’s not confuse simplicity with lack of significance. Rub usd converter An effective Store of Value needs to be easily and seamlessly retrieved, exchanged at a later time, and predictably useful when one does retrieve it for use. Litecoin charts Discussions over practical use and what is most likely to happen in a world dominated by technology and mobile connectivity can easily lead to a comparison of Bitcoin and gold and silver as a Store of Value.

Critics of Bitcoin tend to refer to how gold and silver continue to withstand the test of time and “hold their value”. Usd jpy chart That is true. Market futures yahoo The physical piece of metal, assuming it is not fake, will always retain some level of value. Usd to zar exchange rate history However, it is more important to consider which options that we have now will perform the best as Stores of Value moving forward rather than the past performance and history of precious metals.

Given that, let’s compare the performances of Bitcoin, gold, and silver as Stores of Value measured in USD and going back to September 1, 2015. What is the futures market We will compare the price action from this date because in middle to late August of 2015 the PBOC (People’s Bank of China, or China’s “Central Bank”) started to very clearly and publicly reveal its intentions to devalue the Yuan. Binary search tree program in c Although we understand that nations always have and always will engage in “currency wars”, this verbal and written action by the PBOC ratcheted up the intensity. Gender pregnancy We can see this is indeed the case simply by looking at the Yuan versus USD and the Yuan versus a basket of currencies representing China’s top trading partners since this time.

Naturally after major moves in prices people tend to ask if it is “too late” or if they “missed out” on an opportunity. Exchange rate usd to inr This raises the question of whether it is “too late” to effectively use Bitcoin as a Store of Value and where we are in terms of this entire experience with Bitcoin and cryptocurrency in general. Stock market trading hours new years eve In short, how much potential still exists for the market value of Bitcoin to rise substantially?

This analysis contends that we are still very, very early in the game fully understanding that Bitcoin has been operational since 2009. Eur usd news today Bitcoin enthusiasts, early adopters, blockchain techie experts, and VCs tend to express frustration over a “lack of killer apps” or the purported failure of Bitcoin to “go mainstream”. Rate of exchange usd to zar We will analyze what killer apps may appear next in another piece but regardless there is still an absolutely enormous amount of potential for Bitcoin to continue performing exceptionally well as a Store of Value. Decimal division calculator In fact, this analysis contends it is likely that the “killer app” of Bitcoin will remain Store of Value for the foreseeable future because it has the most direct and significant impact on human nature and hence economic behavior. Futures market size Applications for the use of Bitcoin will continue to emerge but there is certainly nothing wrong with Bitcoin “only” being used by most as a Store of Value for the time being.

Part 1 of our discussion of Bitcoin as a Store of Value looked at merely 1% penetration of massive pools of funds such as bank deposits in China and global FX daily trading volume. Euro to usd exchange rate forecast Obviously those factors are still present, but let’s veer into another couple of topics that could also play a strengthening role in the very near future. Exchange rate gbp usd An emerging battle between Bitcoin and gold, looming Bitcoin ETF approvals at the SEC (Securities and Exchange Commission), and the extremely intense battle against cash are three spaces that could very well shine bright lights on Bitcoin over the next several months and beyond.

Given the price performances noted above it is natural and highly likely that more and more people and investment professionals start to at least consider trimming exposure to precious metals and initiating exposure to Bitcoin. Currency converter us to aud Gold topped in 2011 and has been in a bear market since with the typical bear market rallies elevating levels of hope that “this time is different” and gold will soon instantaneously vault to $5,000/oz or $10,000/oz. Html editor windows 10 Perhaps gold will enter a new bull market at some point but the reality is that over the last 12, 24, 36, and 72 month periods, gold’s performance falls well short of that of Bitcoin. Trading places stock market scene video Globally about $7 Trillion is stored in gold. Meaning of futures and options in stock market The GLD ETF stores about $30 Billion and there are several other ETFs related to gold or gold miners. Currency conversion aud to usd Bitcoin currently stores around $15 Billion. Exchange rate jpy to usd As more people ask why they should not shift at least some funds oriented around gold into Bitcoin the size of the potential funds moving could substantially impact Bitcoin’s market value.

This analysis will not speculate on if or when either of the two pending ETFs for Bitcoin will or will not gain approval from the SEC. Dollar pound chart Chances are that at some point there will be a way for individuals and institutions to gain exposure to Bitcoin through the status quo channels if only because of the desire of the establishment to profit from Bitcoin. Usd to inr live chart However, the key here is the potential for institutions to be able to enter into significant Bitcoin positions via an ETF eventually. What is a binary system Currently there is no seamless and direct way for professional money managers to gain exposure to Bitcoin using OPM (“Other People’s Money”). Gbp usd rate today In most cases the charters and regulations governing their funds place very strict controls on what they can and can’t buy. Python example programs If institutions could quickly direct seven and eight figure sums into Bitcoin or even more this would have an enormous impact on Bitcoin’s market value in both directions. Currency conversion usd to aud People may not completely understand and absorb that unlike gold or silver money managers moving very large sums of funds can’t simply buy a large chunk of Bitcoin with the click of a mouse or phone call. Free quotes for car insurance Professional money managers crave and need Alpha (the delta or difference between their AUM and fund’s performance and its benchmark). Gbp to usd exchange rate forecast Don’t be shocked if Bitcoin ETFs are used to try and generate Alpha. Usd to aud forecast This is a potential stimulus that is still sitting out there as a future catalyst.

Venezuela. How does the commodity futures market work India. Hkd usd peg Australia. Nzd to usd chart Pakistan. Chf usd These are not tiny countries with miniscule populations in the grand scheme of things. Forex rates in pakistan Venezuela and India already banished certain bank notes literally at the drop of a hat and instantly created even more havoc for their citizens and economies. Exchange rate of indian rupee to us dollar Australia and Pakistan announced plans to do the same in the near future. Msn news video It is very obvious that this is not a crazy, hypothetical scenario and that Central Banks are and will continue their battle against physical cash (to see our prior analysis click here: ). Eur usd exchange rate history Banning cash will only push more people into using Bitcoin as a Store of Value and even a Medium of Exchange as well.

Despite the exceptional performance of Bitcoin since 2009 as a Store of Value relative to all major currencies, we are still very early in the game. 100 usd in euro The current market value of Bitcoin is a microscopic drop in the bucket in the global tsunami of fiat and liquidity sloshing around. Cnbc stock futures market We have not yet even seen the impact institutions can have on Bitcoin and the War on Cash is just entering the tornado phase. Thb to usd Shifting 10% of the $7 Trillion stored in gold currently is $700 Billion. Usd pound exchange rate How high can Bitcoin’s market value ultimately rise over time? We can’t answer that definitively. Yen to usd conversion How much DEBT IN TRANSIT (state sponsored, Central Bank issued fiat currency) can be exchanged for Bitcoin?

All materials are found on open spaces of a network the Internet as freely extended and laid out exclusively in the fact-finding purposes. If you are what lawful legal owner or a product and against its placing on the given site, inform us and we will immediately remove the given material. The administration of a site does not bear responsibility for actions of the visitors breaking copyrights.