By Alessandro Albano
Investing.com – Nigel Green, CEO, told Investing.com of the DeVere Group ($10 billion) AuM holding company.
Cryptocurrencies are seeing a (slow) recovery after the recent sell-off, with just over $48,000 and close to $3,900, but the recent sell-off “is triggered by a broader sense of risk aversion that has had a huge impact on many sectors in the stock markets as well.” “.
The CEO explains: “The panic occurred at a time of sharply rising inflation which encouraged central banks to tighten monetary policies, putting liquidity at risk that benefited many asset classes including Bitcoin.”
He adds, “Those who believe in cryptocurrencies are always buying on the downside, because they know that digital, global and decentralized, borderless money is clearly the future. BTC has nearly doubled since January 2021: how many other investments can be indicative of that?”
Despite the strong annual rise, even the cryptocurrency with the highest market capitalization has not been spared the volatility of a brand of cryptocurrency, as evidenced by the trend of the past two quarters. But for Green, the volatility is “always used as a buying opportunity to fill portfolios.” “This could explain why a lot of people are worried about selling cryptocurrency when things are a little turbulent on social media.”
In a scenario characterized by high inflation, and with people worried that this will severely erode their purchasing power, cryptocurrencies and other digital currencies can be considered a “shield against inflation” thanks to the “limited supply. which is not affected by price”.
“In this inflationary period – the manager stresses – the asset outperformance is one of the assets that has been universally hailed as the last hedge against inflation, at least for now.”
To back up his argument, Green highlights the fact that the third-largest owner of Bitcoin has amassed more than $150 million in cryptocurrency after the latest flash crash, BitInfoCharts data shows. He warns that “prices of bitcoin and other cryptocurrencies can drop by 10% or more in a matter of hours,” specifying that “it is essential to have an appropriately diversified portfolio to mitigate risk.”
Long-term investors usually “always benefit from those who panic buying their assets at a low cost”. “Doesn’t the sharp drop in bitcoin seem particularly beneficial to you with such high inflation?” Finally asks the CEO of the London company.
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