Professional investors should feel confident navigating a conversation around Bitcoin. As this asset continues to pervade advisory conversations and investment committee meetings, the unique qualities Bitcoin possesses can make valuation a daunting task.
Bitcoin’s Quantitative Tightening
As the world grapples with COVID-19, it’s important for investors to understand the effects of government monetary and fiscal intervention, particularly in the context of digital currencies like Bitcoin and the unique attributes they possess.
An Introduction to Bitcoin
Bitcoin is the first and arguably most successful decentralized digital currency in the world. Users can send or receive payments in bitcoin through a peer-to- peer (P2P) network, which is supported by its underlying blockchain protocol.
Bitcoin & the Rise of Digital Gold
Over the last decade, Bitcoin has grown from a small-scale experiment into the dominant leader of a new asset class with the potential to revolutionize many aspects of our lives.
Using Bitcoin to Hedge Against Global Financial Crises
Financial crises are happening more frequently and span across many geopolitical regions. For example, during the Global Financial Crisis (GFC) between October 2007 and March 2009, the S&P 500 and several of its global equity counterparts lost more than half of their value, erasing decades of wealth accumulation and challenging our understanding of market efficiency and systemic risk.
The Next Bitcoin Halving
The next Bitcoin halving will take place in May 2020. At that time, the block reward for miners on the Bitcoin network will decrease from 12.5 to 6.25 bitcoins, the third such “halving” event in the network’s history.