12.04.2023 – The price of Bitcoin is picking up. The e-currency has just marked a new ten-month high – and conquered the $30,000 mark. The reasons: On the one hand, the flight from inflation. On the other hand, BTC is suddenly considered a safe haven in the banking crisis.No scandals, no insolvencies – and the bulls are already buying again. This year, BTC has already achieved a whopping return of around 80 percent. The last time the cyber currency was quoted at this level was in June 2022. Here is the daily chart.
Source: Bernstein Bank GmbH
This is an interesting development, which indicates that the distrust of banks persists: Before an institution keels over, many investors apparently prefer to bring their dollars and euros to safety and buy BTC, which they store on a server.
Suddenly BTC stands for safety
Which brings us to a remarkable change in attitude towards e-currencies: they were once considered unpredictable and risky. But suddenly BTC and co. are apparently the safe haven. “BTC is now properly starting to be perceived as a risk-off asset,” said Richard Mico, head of Banxa, a payment and infrastructure service provider in the crypto world. He added: “BTC is also being seen as a reliable store of value that lacks the issues that come with storing your money by way of a third-party intermediary, or a bank.”
Big investor MicroStrategy
Another push factor was the announcement by the company MicroStrategy just over a week ago: according to this, the software group has now amassed around 140,000 BTC coins. At an average purchase price of 29,803 dollars per unit, the company is currently making a profit. So the company did not pull out of the downward slide from the all-time high. Which I’m sure many traders took positively.
Protection against inflation
In addition, the regulatory authority for the financial sector in Argentina has just sent out a positive signal: The Comisión Nacional de Valores de Argentina has approved a series of index futures for the Matba Rofex exchange that are based on Bitcoin. The vote of confidence is the first of its kind in Latin America and could improve acceptance for the e-device. Especially as Argentina is plagued by hyper-inflation and many investors want to preserve their purchasing power outside the peso. In February, inflation stood at a whopping 102.5 per cent year-on-year.
Which brings us elegantly to the topic of inflation: Today’s Consumer Price Index in the US will set the direction for the financial market in the short term. And this also applies to Bitcoin. Consumer prices should provide information on how the Federal Reserve will continue to fight inflation. By the time you read these lines, you will certainly know more. With this in mind: Bernstein Bank wishes you successful trades and investments!
_________________________________________________________________________________
The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 68% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7