Cathie Wood, the founder, CEO, and CIO of Ark Invest has reiterated that, despite the present market circumstances, she is more positive on Bitcoin than negative.
Speaking on CNBC’s Squawk Box, the serial investor highlighted the finer parts of Bitcoin’s fundamentals that made it a sound investment for her organization and other investors.
For Wood, who believes in investing in innovative technologies, Bitcoin represents a valuable asset class and a new monetary system that is more than simply an inflation hedge. If their data is correct, the economy may soon turn deflationary, according to the CEO, since inflation is falling. This is why Bitcoin is more than simply a haven against inflation. Bitcoin, she believes, will continue to serve a vital role in defending against counterparty risk and protecting against seizure as inflation fears go away.
In the long run, it is critical as an asset to protect against counterparty risk in the event of a collapse similar to that of 2008 and 2009. It’s also a critical asset class for hedging against wealth confiscation other than inflation. She also emphasizes that Bitcoin will always have a role as a rules-based global private monetary network unlike any we’ve seen before.
One of the basics of Bitcoin is that it has no counterparty risk. This is because bitcoin arose from the 2008 financial crisis, primarily triggered by counterparty risk in the housing market, resulting in many defaults and a financial market meltdown. In basic words, counterparty risk, also known as default risk, is the possibility that a company or a person would be unable to satisfy their debt payment commitments.
Bitcoin supporters believe there should be no danger of any party trading in Bitcoin defaulting on payment or a third party seizing Bitcoin kept in one wallet. Bitcoin does this by being a decentralized system with no centralized authority for regulators to target.
In the meantime, Wood refused to provide specific financial advice when asked whether the present market was a good time to purchase for understandable reasons. Nevertheless, she did point out that more indications were indicating “green” than “red” as per Ark Invest’s on-chain monitoring.