Bank analyst Marion Labour named the factors that make the first cryptocurrency an unstable asset.
Deutsche Bank Research analyst Marion Labour called the use of the first cryptocurrency as a store of value too dangerous, but admitted that bitcoin could become the digital gold of the 21st century.
Labour identified three factors that make Bitcoin an unstable asset:
- Two-thirds of the available bitcoin are used for investment and speculation;
- Due to limited circulation, a few large purchases or sales of cryptocurrency can significantly affect the balance of supply and demand;
- Bitcoin price will continue to rise or fall depending on how investors perceive the cryptocurrency.
“About 89% of the total bitcoin supply is already in circulation,” Labourt said.
According to an analyst at Deutsche Bank Research, Bitcoin will remain an extremely volatile asset in the near future. At the same time, Labour added that historically, gold has also been an unstable asset.
In the period from 2000 to 2011, the value of gold futures increased by more than 600% and reached a local maximum of $ 1.9 thousand. In 2011, futures went down.
In 2015, the value of securities fell to a local minimum of $ 1.1 thousand (a decrease of 42% from the local maximum). On September 27, 2021, gold futures on the US premarket traded at $ 1.75 thousand.
Deutsche Bank is the largest German financial conglomerate. As of 2020, he manages $ 1.3 trillion in assets. Since 2011, Deutsche Bank has been one of the globally systemically important banks on which the stability of the world banking system depends.
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