It took just two months for Bitcoin to double in price between late December and late February and it has been appreciating almost steadily ever since, now nearing $60,000. But is that rally sustainable and a reason to buy the most liquid of cryptocurrencies?
Not according to the findings of a new report from the commodity strategists at BofA Securities that knocks down many of the often-cited reasons to own Bitcoin: that it democratizes the world of finance, doesn’t correlate with other assets and acts as a hedge against inflation. In addition, the report lays out other shortcomings of cryptocurrency.
The report concludes that “the main reason for holding Bitcoin is not diversification, stable returns, or inflation protection, but rather sheer price appreciation, a factor that depends on Bitcoin demand outpacing supply.“ There is “no good reason to own BTC unless you see prices going up.”
Check out the slideshow above to learn more about key Bitcoin “dirty little secrets,” according to BofA Securities’ commodity strategists.