MicroStrategy, a US-based firm that provides business intelligence, mobile software, and cloud-based services, had bought a relatively large amount of Bitcoin. The company had reasons to protect itself from the impending inflation problem and take advantage of what the company believes to be the most unique niche in value storage, even against gold, which has been an industry favorite for the past decade. So, can Bitcoin be the national currency?
Bitcoin as a national currency: Is it possible?
According to the ZyCrypto news, the cryptocurrency interaction from the American economy echoes the comments made by Jason Williams, co-founder of Morgan Creek Digital, who claims that the US may be the first country to adopt Bitcoin as its national currency.
No country in the world has made Bitcoin a national currency, and the US, like many others, is still in the early stages of hardening proper regulatory guidelines. But there are two alternative ways Bitcoin can be more dominant than it already is and mobilize itself to become the currency of the nation. Adoption by institutional investors and leading traditional technology companies.
There is a transition from gold to Bitcoin
As a better store of value, Bitcoin ceases to be an asset to prove. The number of investors has doubled compared to 2019. Since then, many investors have been investing their money in Bitcoin as a safe haven asset.
Preparing themselves for the perceived economic recession, investors competed to lock their assets with the safest vehicle. This was before the pandemic or the US-China tension. The US dollar is also in a weak spot, as the US presidential election has fueled investors' fears, among other key factors. Most US investors naturally switch to gold, silver and the stock market.
With dollars minted for economic stimulus, investors struggled with upcoming inflation by trying to secure their assets, and the value of digital currencies began to explode. However, even though Bitcoin keeps the title as a unique asset; Its performance against gold has been surprising. Bitcoin gained 64% since the beginning of the year, while gold gained 28% and silver 49%.
The traditional gold acquisition curve among investors is also flattening, and savvy investors are turning to Bitcoin. This also applies to hedge fund manager Paul Tudor. The billionaire macro investor explained that he considered various bets on assets such as gold, stocks, commodities and treasury before realizing that there is a "growing role for Bitcoin". This awareness has attracted firms like MicroStrategy, and members of the company reiterate that Bitcoin reserves will not be sold. Crypto-centric institutions like Grayscale have also seen an increase in the number of investors.
Result
Bitcoin, as a national currency, could look possible anywhere in the world. However, with the pace of the country, the cryptocurrency was long behind, long before central policies were weakened. Without a national adoption, Bitcoin is still valuable in nature.
