Research: Bitcoin is an effective portfolio diversification tool with the same store of value and hedging properties as gold

Odaily Planet Daily Report: The Bitcoin Policy Institute recently published a paper titled "The Case for Bitcoin as a Reserve Asset". The article argues that central banks should adopt Bitcoin as a reserve asset to hedge against rising inflation, geopolitical risks, capital control risks, sovereign defaults, bank failures, and international sanctions imposed by the US government. The author of the paper, economist Matthew Ferranti, stated that Bitcoin, as a decentralized asset, has a low correlation with other financial instruments, making it an "effective portfolio diversification tool". Ferranti also emphasized that Bitcoin has no counterparty risk, and can effectively hedge against sovereign defaults (including the risk of financial sanctions). He clarified that Bitcoin and gold allocation may not be the choice of every central bank, however, this emerging digital asset has the same value storage and hedging properties as gold, especially in cases of rapid currency depreciation. (Cointelegraph)