As per Steven Lubka, the managing director of private clients at Swan Bitcoin, ‘Bitcoin is working as a hedge against inflation despite its 2022 weak price performance.’
According to Steven, Bitcoin (BTC) should still be regarded as an inflation hedge, even if it failed to counter this year’s widespread global inflation.
On the contrary, CEO of Skybridge Capital, Anthony Scaramucci, says that Bitcoin needs significantly more buildout before it can act as an inflation hedge. He believes that even though Bitcoin (BTC) is thriving as an attractive asset, it has not yet reached the “wallet bandwidth” that is required for it to be considered an inflation hedge.
Steven Lubeka considers BTC to be inflationary hedge
Steven Lubka, managing director of private clients at Swan Bitcoin, argued that bitcoin should be considered an inflation hedge in his recent interview.
Lubka agreed that Bitcoin has failed to act as an inflationary hedge during the global inflation events this year. However, he seemed to believe that this inflation has been predominantly caused by supply shocks rather than monetary expansion, wherein Bitcoin is in a state to hedge against inflation more effectively.
“In a world where the price of goods is rising because there has been a massive loss of abundance, bitcoin is not going to protect investors from this,” Lubka said.
He added, “Bitcoin has none of those risks that I just identified as stocks or housing have. It’s a pure store of value.”
Scaramucci: Bitcoin could become an inflation hedge once it hits the billion-plus zone
On Monday, on CNBC’s Squawk Box, SkyBridge Capital’s Anthony expressed his belief that bitcoin is still much more than “an early adopter technical asset,” which was valued at nearly a billion dollars before it began to act as an inflation hedge. Will need to login to Wallet.
Scaramucci said, “Until you get into the billion, billion-plus zone, I don’t think you’re going to see Bitcoin as an inflation [hedge] as it’s still an early adopting technical asset.”
The number of bitcoin wallets worldwide is estimated at around 200 million, with the exact number still unknown.
When Bitcoin had just started out, it had a fixed supply of 21 million coins, which is why some endorsed Bitcoin as a potential inflation hedge. However, the narrative has changed over time, given the fact that Bitcoin has been noted to be increasingly correlated to the stock market, as per a new IMF report.
“Bitcoin is still not a mature enough asset to be considered a potential inflation hedge. You don’t have wallet bandwidth with bitcoin,” They say Scaramucci.
Scaramucci clarified that his views should be taken to mean that he wasn’t bullish on the asset. He believes that there is strong institutionalized demand for the leading cryptocurrency given the overall crypto market pointing to recent moves from BlackRock to launch a new private spot Bitcoin trust with Coinbase as the custodian.
Scaramucci feels that the market has so far been filled with too many short positions, which could cause people to ‘tear off their faces when they least expect it.’
At the time of writing, Bitcoin’s price is at approximately $21,406, down by 69.01% from its all-time high of $69,045 on November 11, 2021.
Meltem Demirors, Chief Strategy Officer of CoinShares, at Squawk Box on Monday Told She expects the bitcoin price to remain stable in the third quarter as the price correlation between technical equities and cryptocurrencies continues.
“With Bitcoin, we’ve seen a lot of buying on dips. While internally there’s a lot of enthusiasm within the crypto community around the merge. I don’t think there’s a lot of new capital coming in to buy Etherium on these changed fundamentals,” Meltem Demirors said.
