Bitcoin as Safe Haven

Bitcoin as Safe Haven
Safe haven is an investment asset that has a low level of risk, when the global economy is uncertain or there is geopolitical turmoil. ... That is, safe haven assets are assets that are used as an escape when global economic conditions are considered unsafe. Examples of Safe Haven Assets There are several types of safe haven assets today, including US government bonds, gold, silver, land and property, Japanese Yen and USD.

Can Bitcoin be used as a Safe Haven?
Bitcoin is often referred to as a risky asset, because Bitcoin was born, about a decade. In many ways, the risk profile of Bitcoin resembles the startup company in its early stages. So Bitcoin as a safe haven takes a long time.

In many ways, Bitcoin is the best safe haven asset. He can "take care of himself". So when the traditional system goes bad, Bitcoin can be relied upon. If there is war or political turmoil in a country, many rich people in the country will buy Bitcoin as a safe haven. The reason is that Bitcoin is open and unlimited, accessible to anyone, with a relatively liquid market in every country in the world. Bitcoin is clearly relatively resistant to censorship, meaning that no government or any institution can directly prevent Bitcoin transactions. Bitcoin has a fixed and clear supply of gold.


Other experts say that until now Bitcoin is not a safe haven asset, especially when the stock market falls due to fears of the Corona virus outbreak, because the value of crypto assets, like Bitcoin, is very difficult to measure. In contrast to stocks, especially bonds, however, in crypto assets such as Bitcoin and Ether, it is really very difficult to measure its value. The main cause is that crypto assets do not have fundamentals. Except for the network itself, because users on the network judge Bitcoin themselves when making transactions. But, the need for the transaction was merely speculative in nature.

When other assets are considered more valuable such as gold and sovereign debt in the US, holders of Bitcoin and other crypto assets tend to sell their reserve assets. This means that crypto assets are considered more risky than the stock market, due to an unexpected Corona virus outbreak. So far, Bitcoin is not a safe haven asset, because we don't have enough historical data to measure it. Later, when the market gets wider, then we have many considerations to review it again.

In the future, when sentiment in the capital market is as negative as it is today, crypto assets, including Bitcoin, potentially behave similarly.