Bitcoin (BTC) Faces ‘Unexpected Crises,’ According to Bitwise CIO Matt Hougan – Here’s the Explanation

The chief investment officer at Bitwise, a crypto asset management firm, has predicted an unforeseen crisis for Bitcoin (BTC). In a recent discussion on the Insightful Investor YouTube channel, Bitwise CIO Matt Hougan highlighted that Bitcoin has now reached a level of stability where it can be viewed as a store of value, akin to gold.

Hougan emphasized that assets serving as stores of value typically exhibit a trend where their volatility decreases over time as their value rises. He pointed out, “I would argue that [Bitcoin] has reached a point of stability to be utilized as a store of value. Since Covid, the US dollar has depreciated by 25% while Bitcoin has surged by approximately 800%. It serves as a reliable store of value. It’s essential to remember that even gold experiences significant volatility. Bitcoin, albeit slightly more volatile than gold, offers greater potential upside.”

Regarding the investment perspective, Hougan mentioned that due to Bitcoin’s real-time pricing, investors are more sensitive to its volatility compared to other assets, especially during unexpected crises. He stated, “I am quite confident about Bitcoin’s eventual trajectory, but the speed at which it will reach there remains uncertain. Developments such as the US election and decisions on debt and deficits will impact Bitcoin’s journey. Unexpected crises will also play a role. Bitcoin’s pricing in real time magnifies the experience of volatility, akin to an early-stage technology company undergoing real-time valuation.”

At the time of reporting, Bitcoin was trading at $59,084, reflecting a 4.5% decrease over the last 24 hours. Hougan’s insights shed light on the evolving nature of Bitcoin as a store of value and the dynamics influencing its price movements. The cryptocurrency’s journey towards stability and its potential for long-term growth amidst market uncertainties are key considerations for investors navigating the crypto landscape.

The discussion underscores the evolving narrative around Bitcoin’s role as a store of value, highlighting its resilience and potential amidst market fluctuations and unforeseen events. As Bitcoin continues to demonstrate its value proposition and investment potential, its journey towards mainstream adoption and recognition as a reliable asset class remains a focal point for market participants and observers alike.