Bitcoin Is Hedge Against Global Liquidity Crises: Grayscale Investments

The major cryptocurrency asset manager which is managed by Digital Currency Group – Grayscale Investments – has recently released a report in which it says that Bitcoin is hedge against global liquidity crises.

Featured on many best cryptocurrency news sites, this report shows that Bitcoin has a massive potential and ought to be considered a strategic position within long-term investment portfolios. The asset manager which acquired CoinDesk in 2016 has also said that Bitcoin is hedge – but that it also has a transparent, immutable and global liquidity.

Additionally, the report shows the new shifts in monetary, fiscal and trade policies around the world. Because of that, Grayscale alleges that politicians and policymakers may find it increasingly difficult to manage their economies – insinuating a need for investors to take control of their own finances.

The latest cryptocurrency news also show that the report (besides claiming that Bitcoin is hedge) examined five recent macroeconomic shocks in which the digital asset outperformed investments as a store of value. The authors in it extrapolated from the case studies including Grexit, Brexit, China’s structural devaluation of the renminbi as well as the two Trump shocks – all of which indicating that Bitcoin is hedge and could be a useful tool in helping investors insulate their portfolios from any potential market failures.

Snother case study showed that according to Grayscale Investments, Bitcoin managed to deal with many crises better than other assets.

“Between the day of the announcement and the trough of the drawdown, Bitcoin largely outperformed the following major markets and currencies, producing a cumulative return of 53.6 percent versus an average return of -10.1 percent.”

Bitcoin was used to hedge against the Chinese liquidity risk, caused by local investors when they sold their assets against a structural currency devaluation.

When it comes to Brexit as a topic in the altcoin news, during the first one-day global selloff of the pound sterling (GBP) and euro, the researchers found that “Bitcoin was a top performing asset” which boasted a return of 7.1% on strong volume versus an average of -2.1% for the rest of the group of currencies.

On top of this, the researchers find cause to recommend because the details of the transaction plan are still being worked out.