Fidelity Calls Bitcoin an ‘Aspirational’ Store of Value and an ‘Insurance Policy’

Bitcoin is an aspirational store of value according to Fidelity Digital Assets.

Fidelity Digital Assets, subsidiary of multi-trillion dollar investment firm Fidelity Investments, views Bitcoin (BTC) as an “aspirational store of value� and an “insurance policy� against a troubled financial system according to a new report.

Fidelity holds over $8 trillion in assets and its digital assets arm launched in October 2018.

Bitcoin is an “aspirational store of value�

The report, Bitcoin Investment Thesis: An Aspirational Store of Value, notes that Bitcoin meets the basic test for being considered a store of value but hasn’t achieved that status yet:

“Many investors consider Bitcoin to be an aspirational store of value in that it has the properties of a store of value but has yet to be widely accepted as such.�

The core components which drive its potential as a store of value lie in the “decentralized settlement network and its digitally scarce native asset�. Bitcoin’s volatility, often used in counter arguments against Bitcoin being a store of value, can be considered beneficial to adoption as it “attracts attention, development and innovation� the report says.

According to John Pfeffer of Pfeffer Capital LP, who is quoted in the report: “Most people in the world don’t yet see Bitcoin as digital gold. As soon as people see it in a different way, the price will adjust�.

Bitcoin is an “insurance policy�

The report also makes reference to the concerns around money printing as a result of the COVID-19 financial crisis and suggests that some are losing trust in traditional economies:

“The unknown consequences of record low interest rates, unprecedented levels of global monetary and fiscal stimulus and deglobalization are all adding fuel to the fire of awareness and adoption.�

John Vincent of Wakem Capital Management made reference to money printing in light of the recent Bitcoin block reward halving. “You don’t need to be a PhD to understand that the number of dollars just doubled whereas the BTC supply just halved,� he said. 

Another catalyst for adoption the report notes is the transfer of wealth from the older generation to a younger demographic as “younger people view Bitcoin more favourably�.

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