Bitcoin has matured as an asset in the past few years and is now a safe investment such as gold and bonds, said SkyBridge Capital’s Anthony Scaramucci and Brett Messing.
In a recent joint post, the duo also highlighted BTC’s intangibility as significant merit, which outlines bitcoin’s uniqueness.
BTC Is As Safe As Gold And Bonds
Anthony Scaramucci, the co-founder of the large Wall Street investment company SkyBridge Capital, and the firm’s president and COO, Brett Messing, published an opinionated post in an attempt to debunk some of the most popular myths and risks regarding BTC investing.
They admitted several such “unique and pronounced risks,” including the possibility of losing the private keys to a wallet where users store the bitcoin wealth and enhanced price swings.
While the former requires more personal diligence, the latter is changing with “new rules and regulations that have spurred wider institutional adoption.” Such an example came last year as the US Office of Comptroller of Currency authorized banks and custodians to add cryptocurrency services.
These signs of maturation made bitcoin more attractive to institutions as multiple prominent names made sizeable allocations and openly praised the asset. Thus, BTC has become comparable with some of the most traditional and safe asset classes:
“Increased regulations, improved infrastructure, and access to financial institutions – like Fidelity – that hold investors’ money have made bitcoin investments as safe as owning bonds and commodities like gold, which are also used to balance portfolios.”
The executives also noted that BTC is still very early in its adoption phase, and it “offers significant long-term value.” Bitcoin, as an emerging asset class, is currently situated somewhere between “an infrastructure to allow for wider adoption” and “leaving room for appreciation.”
Addressing BTC’s Volatility
One of the most infamous features of bitcoin is its volatility. The primary cryptocurrency has gone up or down by double-digit percentages in a day on more than one occasion. However, Scaramucci and Messing attributed these movements to its “newness” and lack of clear regulation.
The situation is changing, though, as more world watchdogs are looking into and implementing new regulations. Consequently, the duo argued that high-net-worth individuals, macro funds, hedge funds, and life insurance companies are “drawn to the more stable environment” of BTC investing.
Separately, the post touched upon the economic uncertainty prompted by the COVID-19 outbreak, which drove world governments to take extreme actions. In such moments, investors, and even regular people, tend to go for tangible assets, like gold, and neglect intangible options such as BTC. However, the duo believes that this particular feature represents the cryptocurrency’s strength:
“Bitcoin is valuable because of – not despite – it’s intangibility. You can always mine for more gold. Bitcoin is unique among assets as the first store of value in the world where supply is completely unaffected by increased demand.”
The billion-dollar hedge fund SkyBridge Capital launched a Bitcoin Fund L.P. earlier this year with an initial investment of $25 million. Scaramucci will serve as the fund’s manager, and his goal is to “democratize bitcoin.”