Morgan Stanley’s head of emerging markets and chief global strategist, Ruchir Sharma, published a report on "Why Crypto Is Coming Out of the Shadows". In the report, he mentions how cryptocurrency is becoming more established and for those who don't adapt, to "risk being left behind". The report cites that 20% of all U.S. dollars in circulation were printed in 2020 and how that inflationary risk is fueling the rush to cryptocurrencies. Bitcoin is up 200% in the year, compared to the S&P 500 Index* that only rose 16%.
Moreover, U.S. debt to other countries surpassed 50% of its GDP in 2019. In 2020, given COVID-19, that debt rose to 67% of GDP, a big warning sign that the U.S. dollar may lose dominance as its liabilities rise.
As Bitcoin gains market share, the volatility has gone down from an annual average of over 400% to 69%, compared to "27 percent for silver, 13 percent for gold, and around 20 percent for stocks." According to a recent survey mentioned in the report, "only 3 percent of baby boomers in the United States said they own a cryptocurrency, compared to 27 percent of millennials." As Bitcoin and other cryptocurrencies continue to change the financial landscape, bitcoin will not only act as an investment but also a medium of exchange for paying bills. The case for bitcoin is undoubtedly strong. Those who do not adapt will get life behind.
-Adapt or Die
*The S&P 500 Index, or the Standard & Poor's 500 Index, is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies. It is commonly used as a measure of the U.S. stock market.