Promises of unlimited money-printing lead the world’s largest crypto asset manager to sound the alarm to investors, promoting Bitcoin as a solution.
Bitcoin (BTC) is now investors’ best bet against central bank money printing, a new report from asset manager Grayscale concludes.
In the document, titled “Quantitative Tightening,” the world’s largest digital currency asset manager warned that unlimited fiat money supply risks “debasement” of the U.S. dollar.
Grayscale: gold safe-haven role “antiquated”
BTC, the largest cryptocurrency, is an ideal safe haven, its technical prowess setting aside from gold, fiat and government bonds.
“Untenable levels of debt and fears of widespread default are driving the most aggressive monetary policies since Bitcoin’s creation,” the report concludes.
“Fiat currencies are at risk of debasement, government bonds reflect low or negative real yields, and delivery issues highlight gold’s antiquated role as a safe haven. There are limited options to hedge in an environment characterized by uncertainty.”
Its title is another term coined to describe the effect of Bitcoin’s upcoming block reward halving in around two weeks.
Whereas central banks are engaging in now unlimited quantitative easing, or QE, Bitcoin’s supply is cutting in half. Other sources call this juxtaposition “quantitative hardening,” referring to Bitcoin’s status as “hard” money versus fiat as “easy money.”
“Bitcoin is showing signs of becoming a safe haven while maintaining an asymmetric return profile,” Grayscale’s conclusion summarizes.
“And while the world is seemingly challenging every notion of what is possible, it’s time to challenge another one — that fiat currencies will retain their value. It’s time to pay attention to Bitcoin.”
Tide turns on central bank acceptance
Grayscale has fared well despite the huge panic caused by coronavirus in March. The company now has $3 billion in assets under management, while earlier this month, it emerged that it now controls 1.7% of the entire Bitcoin supply.
The report barely holds back in its thinly-veiled criticism of central bank policy. Investors, it says, should “understand the effects of government monetary and fiscal intervention.”
That language echoes some of Bitcoin’s best-known supporters, including Saifedean Ammous, who extensively addresses fiat weakness in his popular book, “The Bitcoin Standard.”
Speaking on the latest episode of financial news show the Keiser Report, meanwhile, Max Keiser reiterated that as a society, “you can’t print your way to prosperity.”