Bank of Singapore – Bitcoin May Replace Gold As Store of Value January 28, 2021 January 28, 2021 Kelly Cromley http://1AZFjzw2#Nwf63pYaMWq#xIY
Bitcoin NewsJanuary 28, 2021 by Kelly Cromley

Bank of Singapore – Bitcoin May Replace Gold As Store of Value

The Bank of Singapore has stated that Bitcoin and cryptocurrency markets have the capability to establish a new digital standard for the storage of value and become a substitute for gold. Mansoor Mohi-uddin, chief economist of the bank, has stated the National News that budding cryptos have to withstand a multitude of tests to demonstrate their permanence and feasibility of holding wealth.

“First, investors need trustworthy institutions to be able to hold digital currencies securely. Second, liquidity needs to improve significantly to reduce volatility to manageable levels.”

Mohi-uddin points out that huge price volatility of Bitcoin in the past 12 months and the manner in which it plunged along with conventional assets in March 2020 as two major indications that it is yet to transform into a stable store of value.

“Bitcoin is highly volatile as its rally over the past year from $4,000 to more than $40,000 and then back towards $30,000 shows. Bitcoin is also correlated with stocks and other risk assets rather than trading as a counter-cyclical safe-haven. In a financial crisis, cryptocurrencies are more likely to be dumped by investors during a market meltdown, as occurred at the start of the pandemic in March 2020.”

He has reservations about the likelihood of cryptos susbstituting fiat currency, but trusts that Bitcoin’s shortage is totally contradictory to the present period of fast money printing and ultra-loose monetary policy.

“Governments are very wary of any technology that could potentially displace national currencies. This would reduce the ability of policymakers to print money during economic crises.”

AuthorKelly Cromley

Kelly is our in house crytpto researcher, delving into the stories which matter from blockchains being used in the real world to new ico coming out.