The research arm of Coinbase, a top U.S.-based cryptocurrency exchange platform, says investors are likely to actively buy Bitcoin (BTC) when it falls.
Coinbase Institutional says in a new blog post that gold is the winner this cycle due to rising economic and geopolitical concerns.
According to Coinbase, gold's success can be attributed to both the threat of inflation and expectations that the Federal Reserve will begin a rate cutting cycle.
“Gold has been the biggest winner in this environment, hitting new highs amid increased central bank purchases, rising geopolitical risks and reflation concerns.
What makes gold's performance notable is that gold's gains are generally associated with both Fed rate cuts and rising inflation.
Given recent market hawkish views on rate cuts, gold's performance suggests that there is an overweighting of inflation relative to Fed rate changes, and that certain inflation increases may be more problematic than expected. We believe that this shows the overall idea that there is a possibility that this will become a reality. ”
Focusing on Bitcoin, Coinbase Institutional said that the market can expect BTC to accumulate more aggressively during the correction period as the top crypto asset by market capitalization is commonly accepted as “digital gold”. ing.
“In our view, the acceptance of Bitcoin as a type of ‘digital gold’ could enable demand from some new investors in this market regime. As a result, we believe that even if volatility persists during price discovery, we will likely see more aggressive push buying than in previous cycles. ”
Coinbase is also the crypto king as the network prepares for a reduction in new BTC supply due to the halving, while benefiting from demand from spot market BTC exchange traded funds (ETFs). He also stated that he remains bullish on the issue.
“In our view, the capital released by ETFs represents perhaps the most fundamental change in market structure between the previous 2020-2021 cycle and today.
The unlocking of these capitals is coupled with the upcoming Bitcoin halving (estimated to occur between April 20th and 21st, depending on network hashrate fluctuations). Other positive catalystsThrough the second quarter, our view remains largely constructive. ”
At the time of this writing, Bitcoin is trading at $69,283.
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