The global crisis and financial market turmoil have many investors looking into whether cryptocurrencies, such as bitcoin, are a good investment for them. A Japanese analyst has predicted high institutional investor demand for bitcoin post coronavirus crisis, giving three key reasons why the cryptocurrency is an attractive investment.
High Institutional Demand Expected Post Coronavirus Crisis
The covid-19 pandemic has led to an unprecedented economic crisis, with the IMF calling it the worst recession since the Great Depression. Companies are missing their earnings estimates and many traditional investments have taken a hit across the board. The crisis has investors scrambling to find safe haven assets, and more people are now asking whether cryptocurrencies, such as bitcoin, are a good investment.
Bitcoin Lab CEO Tetsuyuki Oishi, a guest crypto analyst at Japanese financial company Fisco, shared three reasons earlier this week why he sees considerable demand from institutional investors for cryptocurrencies post the pandemic.
Firstly, he said that the stock market may lose its attractiveness after the coronavirus crisis due to decreased demand for many companies’ products, resulting in long-term declines in corporate profits. He elaborated:
Most consensus is that a V-shaped recovery of stock prices is difficult. Therefore, investors need to seek out investment options other than stocks. Investors can’t just put everything in cash.
Next, the analyst asserted that cryptocurrencies are attractive because there is still very little correlation between them and traditional investments. He explained: “During the plunge, of course, all assets were sold, both gold and bitcoins were sold, but they picked up thereafter …
