Cryptocurrency
Bitcoin Is Suddenly Behaving ‘Like A Tech Stock’—But Might Not Be For Long
Forbes reports, “Technology stocks, including iPhone-maker Apple … and social network Facebook, have surged during the coronavirus pandemic. “Bitcoin, up 60% year-to-date, has (so far) outperformed them all—even beating Amazon’s massive 2020 stock price rally and dwarfing the Nasdaq’s NDAQ 22% increase. “Now, London-based digital asset management firm CoinShares has recommended investors allocate 4% of their portfolios to […]
Forbes reports, “Technology stocks, including iPhone-maker Apple … and social network Facebook, have surged during the coronavirus pandemic.
“Bitcoin, up 60% year-to-date, has (so far) outperformed them all—even beating Amazon’s massive 2020 stock price rally and dwarfing the Nasdaq’s NDAQ 22% increase.
“Now, London-based digital asset management firm CoinShares has recommended investors allocate 4% of their portfolios to bitcoin—arguing ‘bitcoin, in its growth phase, behaves like a tech stock.’
“‘Having started its life at a price of zero, it’s no surprise that bitcoin’s investment performance, like that of successful start-ups, has been stellar,’ CoinShares’ research strategist James Butterfill wrote in a report out this week.
“‘As a disruptive technology, bitcoin’s risk profile is rather similar to that of a technology stock: if it reaches its potential, the value could be immense, but at the same time, there is a chance it fails entirely, leaving the value of bitcoins close to zero.’
“Bitcoin, created in 2009, has seen its value rise rapidly over the last decade—surging from mere pennies per bitcoin early in the last decade to over $11,000 now.
“Meanwhile, tech stocks such as Facebook, Apple, Google and Amazon have soared in recent months, pushed on by coronavirus-induced lockdowns that have accelerated a trend toward digital services and remote working.
“The CoinShares report concludes: ‘ is beginning to mature into a store of value, although this is not how it has behaved in the past,’ and advises investors, ‘a bitcoin portfolio weight of just under 4% is optimal in a traditional 60/40 portfolio.’
“The report chimes with recent research suggesting institutional investors on Wall Street are increasingly moving into the bitcoin and cryptocurrency market. There’s also been interest in bitcoin from high-profile stock market day traders casting around for exciting alternatives to equity…”