According to the major investment firm Fidelity, Bitcoin is a unique asset that investors should include in their portfolios.
Despite the importance that Bitcoin has been gaining in recent years, it has been difficult for major financial firms to give their approval to cryptomoney. Analyses such as that of Goldman Sachs have been heard, considering BTC a purely speculative product. That’s why it’s important that the firm Fidelity classifies Bitcoin as a unique asset, in its latest report on digital assets.
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Bitcoin’s relationship with traditional banking
For traditional financial institutions, accepting Bitcoin has been a complicated process. For, despite the countless advantages that crypto-currencies provide to the financial sector. Facilitating the execution of international transactions through Blockchain technology. Banks have usually been reluctant to give their approval to virtual currency.
At the end of the day, this attitude is strongly related to the one maintained by the main governments of the world. Since, the same risk perceived by governments to their privileged position in the current financial system based on fiat money. It is also understood by traditional banking, the main beneficiary of the current monetary organization.
Therefore, it was not strange that some months ago the position of the US investment bank Goldman Sachs was leaked. In a presentation directed to its investors, it advised against the acquisition of Bitcoin, considering it a purely speculative financial product. A position that, however, would not be shared by the company dedicated to the management of financial assets, Fidelity.
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Thus, the unit of the company dedicated to the analysis of digital assets, Fidelity Digital Assets, has mentioned in a recent report that Bitcoin has behaved exceptionally in recent years. Generating unprecedented benefits to its investors, and behaving practically independently from the rest of the assets in the market.
According to Fidelity Bitcoin is a unique asset because of its price. Source: CoindeskAccording to Fidelity Bitcoin, it’s a unique asset because of its price. Source: Coindesk CoinDesk
Thus, Fidelity recommends the acquisition of Bitcoin as an alternative asset. That is, those financial products that, different from stocks and bonds, provide higher returns, but also higher investment risks.
For this reason, for Fidelity the ideal percentage of value that Bitcoin should represent in an investment portfolio is 5% of the total portfolio. If the price of Bitcoin increases significantly, Fidelity recommends selling the cryptomoney to rebalance its weight in the portfolio by 5%. Likewise, if the price drops, it recommends buying BTC.
With this report, Fidelity would become one of the financial firms that have shown the greatest acceptance towards Bitcoin and cryptomonics. Although for some crypto users, 5% seems to be a very low proportion. The truth is that this is an important endorsement of the crypto world, coming from one of the most important investment firms in the world.