With financial markets currently watching the turmoil in the European banking system, and with Deutsche Bank’s problems to the fore, does bitcoin provide the safety investors require in times of distress?
According to a recent CoinDesk feature, any ratcheting up of the current problems in the financial may prove a boost for the digital currency as investors reject traditional fiat currencies.
“The capital markets have awakened to bitcoin as a disaster hedge,” writes analyst Chris Burniske, blockchain products lead for investment manager ARK Invest.
“The digital currency doesn’t correlate with other asset classes, an aspect that may make it more attractive in times of uncertainty,” wrote Burniske, adding,
“Depending on how people feel about Deutsche Bank’s future prospects, they may choose to hedge themselves from the more traditional markets by using bitcoin.”
But are investors truly ready to use crypto-currencies, including Bitcoin, as a hedge against global systemic contagion when the sector has itself had a few high-profile problems.
In June this year, ethereum start-up company DAO announced