Pandemic coronavirus and the subsequent quarantine has forced people to think about the value of traditional money. The fact that the government decided to print Fiat to help citizens, and to do it at serious scale. And since the turnover of nowhere have money, the existing body of currency depreciates. In this regard, many experts suggest to contact gold, silver and Bitcoin, the release of which is restricted. However, the President of the management assets of the company Creative Planning Peter Mallouk disagree.
In support of the purchase of gold and Bitcoin has voiced many experts in the market. For example, in the first half of the month billionaire Paul Tudor Johnson talked about investing in cryptocurrency 1-2 percent of his fortune. The specified percentage can reach 100 million dollars, that is quite a large amount.
Later the decision Johnson supported the CEO Social Capital and the investor of Camat Palihapitiya. According to him, Bitcoin is an independent asset, so it is less likely to lose money during the economic crisis. Note that in early may the correlation coefficient between the first cryptocurrency and the S&P500 index, which includes indicators of the US companies with the largest market capitalization decreased to 0.15.
This means that the exchange rate BTC and shares do not relate to each other. That is, in theory Bitcoin can insure investors in the event of a market decline. However, the collapse of the indicators in mid-March proved to be painful for all.
Why you should not buy Bitcoin
However, according to Peter Mallouk, Bitcoin and gold are assets for speculators. Investors should trust the government and cooperate with it, that is, to reach stocks and bonds. He encourages everyone to think twice before you invest your money in the digital assets or precious metals.
“No need to plunge into the world of speculation,” said Mallouk during an interview with CNBC. Here is his quote in which he shared his own definition of speculative assets.
We call “speculative” anything that brings income to the investors.
Head of Creative Planning believes that Bitcoin and gold will still go through countless UPS and downs. According to him, ordinary investors are unlikely to derive any benefit.
That is, Peter doubts that the dramatic variability in rates of cryptocurrencies and a small growth of gold suitable for novice investors.
Malluk sure , investors should trust the government and buy bonds. Although even in this case, there are some risks. Here is a quote.
If you give money to the debt of the company or the government, they have to refund you. In fact, this is no different from a loan to your brother — perhaps he has income and he will return your money.
And yet the facts speak against the statements of the expert. In 2020 Bitcoin surpassed the profitability of stocks, bonds, oil prices and any other traditional assets. Moreover, the value of cryptocurrencies fully recovered from its fall in March, amid the panic surrounding the spread of the coronavirus.
Fortunately, with the purchase of Bitcoin you don’t need to trust anyone. If your coins stored on a personal cryptocurrency wallet, no one can take away or affect the value of the uncontrolled emission of new coins. So at least the consequences of indiscriminate release of new bitcoins bitcoin is not threatened, it simply does not work.
We believe that the version of Peter Mallika really has a right to exist. Maybe she's really perfect for novice investors who is willing to put up with the possible fall of the cryptocurrency rate of 40 percent per day. However, willing to risk people clearly should think about the relationship with Bitcoin in favor of this at least indicated by the results of the conduct of the course. Also BTC is still the best performing asset of the past decade.
Even more interesting are looking for in our cryptodata millionaires. Also don’t forget to follow us on Yandex Zen.
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