Wednesday, 07 August 2019 01:17

Bitcoin to hit $15,000, edging towards ’safe-haven’ status says analyst Featured

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Bitcoin is now becoming a “safe haven asset” and predicted to hit $15,000 in the wake of the devaluation of China’s currency, with the cryptocurrency jumping 10 percent as global stocks reacted to the devaluation of the yuan and the China-US trade war intensified, according to the chief of one financial analyst firm.

The predictions for bitcoin come from Nigel Green, chief executive and founder of financial advisory firm the deVere Group, who said global stocks were “rocked” by the devaluation of the yuan.

“This is not a coincidence. It reveals that consensus is growing that Bitcoin is becoming a flight-to-safety asset during times of market uncertainty,” Green said.

“Bitcoin is currently realising its reputation as a form of digital gold. Up to now, gold has been known as the ultimate safe-haven asset, but Bitcoin - which shares its key characteristics of being a store of value and scarcity – could potentially dethrone gold in the future as the world becomes increasingly digitalised.”

According to Green the legitimate risks posed by the continuing trade dispute and “China’s currency devaluation and other geopolitical issues, such as Brexit and its far-reaching associated challenges, will lead an increasing number of institutional and retail investors to diversify their portfolios and hedge against those risks by investing in crypto assets”.

“This will drive the price of Bitcoin and other cryptocurrencies higher. Under the current circumstances, I believe the Bitcoin price could hit $15,000 within weeks.”

As Green pointed out, the Chinese renminbi fell to under 7 to the US dollar on Monday – the lowest in more than a decade – igniting drops in stocks and emerging market currencies and driving a rally in government bonds.

“With the Trump administration now officially labelling China a currency manipulator, escalating the tensions between the world’s two largest currencies economies, investors are set to continue to pile in to decentralised, non-sovereign, secure currencies, such as Bitcoin to protect them from the turmoil taking place in traditional markets.

“Cryptocurrencies are now almost universally regarded as the future of money – but what has become clear this week is that they are increasingly regarded a safe haven in the present,” Green concluded.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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