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Bitcoin, the digital currency. (Photo: Getty Images/VNA)
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There are still opposing views on the role of bitcoin in the global financial system, especially given the volatile nature of its price movements that seem to defy traditional market logic.
Rob Nelson and David Gokhshtein, founder and president of Gokhshtein Media, believe that bitcoin’s volatility is complex and influenced by factors beyond a simple correlation with the stock market.
According to Nelson, bitcoin’s fluctuations may be more closely tied to the strength of the US dollar. A weaker greenback could lead to an increase in bitcoin’s value.
He argues that many mistakenly associate bitcoin’s movements with the stock market when, in fact, it is considered an entirely different asset class.
Gokhshtein offers a different perspective, highlighting the influence of institutional investors in the cryptocurrency space. He points out that the involvement of financial giants like BlackRock and Fidelity in bitcoin ETFs signifies a long-term belief in the asset’s value.
Gokhshtein also draws a comparison between bitcoin and gold, particularly in light of how the approval of gold ETFs led to significant price increases. He believes a similar pattern could emerge for bitcoin as the market adjusts to the presence of institutional investors.
Gokhshtein emphasizes bitcoin’s resilience, especially during times of global instability. He attributes its recent recovery from lows to geopolitical tensions and economic developments, such as Japan’s interest rate shift and global conflicts.
“Bitcoin’s consistent rebound, even in today’s complex environment, solidifies its position as a valuable store of value,” asserts Gokhshtein.
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