Forex trading instructor for DailyFX and ex-JPMorgan Chase forex trader, Tyler Yell, recently explained why Bitcoin should be taken seriously.
Also read: Brexit and Bitcoin and Gold…Oh My!
Yell made the case that in times of market duress, including a period of economic collapse, Bitcoin acts like digital gold. DailyFx is the research website of Forex Capital Markets (FXCM), an online Foreign exchange market broker.
Forex Trader: Bitcoin ‘in a Similar League’ as Gold
According to Yell, bitcoin’s mining network makes all the difference. He noted:
Bitcoin’s network and maintenance is what sets it apart from fiat currencies, and places it in a similar league as precious metals such as Gold.
The Forex instructor said he believes bitcoin should be taken seriously for various reasons, but he gave two main ones. First, bitcoin itself has stood the test of time. Second,
blockchain technology has attracted the attention of big financial giants including Goldman Sachs, Citibank, JPMorgan, Barclays, and BNP Paribas. These mega banks believe that blockchain is ‘Next Big Thing’ in Financial Markets.
He admitted that some would call Bitcoin a fad like other financial innovations, such as Adjustable Rate Mortgages. However, many others will continue to believe that Bitcoin and its technology has and will continue to disrupt everything.
Digital Barter Currency
Yell explained that the reason for buying gold and buying bitcoin. “In a ‘doomsday scenario’ where you desire an asset to hold value while other fiat-priced assets are plummeting in value, BTC like Gold is ideal for bartering,” he said. “The difference is that BTC can allow bartering to be done digitally thanks to the blockchain…whereas gold would most likely be bartered face-to-face in the event of an economic collapse.”
Yell noted that since Bitcoin is based on cryptographic algorithm and transactions verified by a distributed network of miners, not banks or traders, gold and bitcoin both came to have value in a very similar way.
“In this manner, Bitcoin is allowed to act as a digital barter currency without the need for banks and helps to accomplish what Gold has accomplished for millennia by acting as a store of value in bad times and good times, and accepted at all times if the price is right,” he added.
DailyFX Will Start Covering Bitcoin Regularly
Yell has been trading in FX markets since 2007 and has written several hundred articles about them for DailyFX. This is his first mention about Bitcoin, and he appears so convinced of its future domination now that he will give regular attention to it.
“Lucky you, DailyFX will begin covering Bitcoin,” he announced. “Given the correlation of XAUUSD & BTCUSD and the rising popularity of BTCUSD, we felt you’d be interested in learning more about the development of this pseudo-currency / neo-haven asset as it turns toward its awkward growth years of potential adaptability into everyday utilization.”
Do you think bitcoin is like digital gold, suitable for bartering in the case of economic collapse? Let us know in the comment section below.
Images Courtesy of DailyFX, policyexchange.org.uk, Dollars and Sense.