Bitcoin will save when currencies devalue – Cathie Wood
Bitcoin will save when currencies devalue – Cathie Wood
Cathie Wood, founder and CEO of the Ark Invest fund, called Bitcoin an insurance policy against the devaluation of fiat currencies and fraudulent regimes. She noted that more and more investors are opting for mainstream cryptocurrency amid the decline of their national currencies against the US dollar.
Cathie Wood sees Bitcoin as a means of protecting against loss of purchasing power and preserving their capital, emphasizing that the significant interest in BTC in various countries around the world signals a flight from the risks inherent in the traditional financial system.
Bitcoin has become an insurance policy against fraudulent regimes and banking crises, Cathie Wood believes. "There is a currency debasement going on that people are not talking about."
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Many fiat currencies are now in crisis and devaluing against the dollar. These include the Nigerian naira, which is down 50%, the Egyptian pound (down 40%), the Argentine peso, the Turkish lira, the Lebanese pound, and the Pakistani rupee. These countries are struggling with high rates of inflation, but their currencies have depreciated sharply in recent months.
Against the backdrop of rising risks to fiat currencies, Bitcoin hit new all-time highs in March not only against these currencies but also against the dollar, demonstrating its benefits as a safe-haven asset in difficult market situations, according to Cryptopotato.
The head of the Ark Invest fund sees this as a pattern: the devaluation of fiat currencies causes an influx of funds into Bitcoins. In recent months, Bitcoin ETFs have also attracted significant amounts of investor money, triggering a sharp rise in the price of BTC. Most investors recognized crypto assets as a protection against the unfavorable monetary policies of central banks and decided to save their money with their help.
"Believe it or not, BTC is a flight to safety. A defense against devaluation. A hedge against a loss of purchasing power. I think it's an insurance policy against rogue regimes or failed fiscal and monetary policies," said Cathie Wood.
As an example, she cited the situation with the collapse of several banks in March 2023, when there was a real threat of a global crisis in the banking system. At that time, Bitcoin received new incentives and showed a growth of almost 40%, which increased confidence in the crypto market and attracted many new investors to it.
Last spring, several US banks, including Silvergate and Signature Bank, were unable to continue operations after massive withdrawals of funds and deposits from the banks triggered a sharp outflow of deposits. Bank stocks fell sharply, forcing the government to take steps to stabilize the situation by closing banks.
At the same time, BTC felt a new burst of strength and showed significant growth, although the cryptocurrency market was previously in a bearish cycle.
The founder of the investment fund noted that this pattern shows that BTC has no counterparty risk.
Read also: Crypto analysts predict the rise of Bitcoin to 90,000 dollars
