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“I am now bullish on Bitcoin”—Bloomberg newsletter talks institutional mania

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A Bloomberg newsletter described Bitcoin as a “way of disintermediating the existing financial system.” It comes as the perception of BTC as a store of value is continuing to strengthen amidst rising institutional demand.

Tracy Alloway, a Bloomberg financial journalist and the co-host of Odd Lots, wrote in a newsletter entitled “Five Things You Need to Know to Start Your Day:”

“I have a confession to make: I am now bullish on Bitcoin. I’m bullish on Bitcoin because I’m bullish on cognitive dissonance in a complex society, and on people’s ability to produce endless narratives for the cryptocurrency—even ones that are at times contradictory.”

Since March, the price of Bitcoin has increased from $3,596 to over $13,600, rising by over three-fold. During that period, it has seen a noticeable spike in institutional adoption as several public companies adopted it as their primary treasury assets.

bitcoin price
The monthly performance of Bitcoin dating back to 2016. Source: BTCUSD on TradingView.com

The unique value proposition of Bitcoin

Bitcoin is seen as a store of value and a currency to disintermediate the financial system. It can bank the unbanked by allowing users to transfer value between one another with a third party.

The unique value proposition of BTC is that it is a settlement network at a nascent stage. But, it can also operate as an alternative store of value or an “inflation play,” as Paul Tudor Jones previously said.

“The reason I recommended bitcoin is because it was one of the menu of inflation trades, like gold, like TIPS breakevens, like copper, like being long yield curve and I came to the conclusion that bitcoin was going to be the best inflation trade,” Tudor Jones said

.

As such, Bitcoin benefits from the growing demand from financial institutions and asset managers while disrupting the financial system. Alloway explained:

“Bitcoin is a way of disintermediating the existing financial system, but it’s also something that would benefit from a flood of institutional money.”

The strength of fungibility

Alloway emphasized that the strength of Bitcoin is its wide range of use cases. Although its primary use case remains to be a store of value and a hedge against inflation, at its core, Bitcoin is a blockchain network and a computing protocol.

“The list of Bitcoin’s purported uses goes on and on, and every time an obituary for Bitcoin is written, a new use case or bull argument steps in to to take its place. I used to think this was a weakness since Bitcoin could never be all these things at once. But the more I think about it, the more I realize that it’s actually a strength.”

Over time, if the mainstream begins to utilize BTC as a currency, there are ways to secure transactional capacity to do so. Second-layer scaling solutions, for instance, Lightning, can enable individuals to transfer value with near-zero fees and quick settlement times.

The post “I am now bullish on Bitcoin”—Bloomberg newsletter talks institutional mania appeared first on CryptoSlate.



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