Home » Business » Opinion: Bitcoin will strengthen its position in the conditions of zero rates and market shocks.

Opinion: Bitcoin will strengthen its position in the conditions of zero rates and market shocks.

CoinShares Development Director Meltem Demirors said negative oil prices are turning the concept of risk in traditional markets, which could strengthen the position of the first cryptocurrency. Comments are given by the Cointelegraph.

The venture capitalist believes that the performance of May contracts for WTI crude oil at prices below zero will forever change the investment world. The COVID-19 pandemic challenged “all ideas of normality,” so she believes a return to her former times is out of the question.

“We are not just observing a change in oil prices. We are observing an understanding of the whole energy value chain. ”– Demirors prompted such conclusions to those events.

According to the top manager of CoinShares, geopolitical interests will now be shifted from access to energy to “computing and communication parameters”. As a basis for her opinion, she cited China, which is developing 5G technology and blockchain.

Turbulence in the financial markets in March, according to Demyroros, also began to change the concept of risk before our very eyes, which could play into the hands of the first cryptocurrency.

“At zero interest rates, the world has truly lost its low-risk, stable, fixed-income assets”“She explained.

Demirors believes that investors are beginning to shift interests towards more risky and highly profitable assets, like bitcoin. The attitude of market participants towards volatility is also changing – the first cryptocurrency is no longer scared by its price fluctuations against the background of what is happening with other assets.

However, according to CoinShares development director, bitcoin has a number of existential risks. Most holders trust their funds to exchanges, so they carry the potential risk of freezing or seizing their assets.

“There are many who consider Bitcoin a hedge against the systemic collapse of the entire financial infrastructure, but they contradict themselves if they do not store cryptocurrency in cold wallets”– explained Demirors.

Recall, Bitcoin Lab CEO Tetsuyuki Oishi presented three reasons why institutional people will perceive Bitcoin as a good investment amid shocks due to the COVID-19 pandemic.

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