Former U.S. President George W. Froome believes that if and when interest rates start to rise, crypto assets may experience a “rapid and profound price crash.”
Institutional benefits of BTC
in comment Frum, which refutes the claims of inefficient BTC mining, conducted an investigation via Twitter and also attacked the value proposition of crypto assets. He pointed out, “Of all the arguments that support Bitcoin, the worst is undoubtedly the store that resists inflation.”
Nevertheless, despite this criticism, the crypto asset continues to gain support from institutional investors and large companies. For example, electric car manufacturer Tesla (Tesla) recently revised its investment policy, and the company revealed that it has purchased $1.5 billion worth of BTC.
In addition, according to the website of bitcointreasuries.org, which tracks companies or institutions exposed to BTC, large companies hold more than 1.3 million coins or 6% of the total circulation.
The true value of BTC
At the same time, Frum’s remarks on Bitcoin triggered a debate on Twitter about the true value proposition of the encrypted asset. For example, Alex Gladstein, chief strategy officer of the Human Rights Foundation (HRF), in response to the above remarks, reminded the former speaker about the impact of Bitcoin on human rights. Gladstein, who recently approved the crypto asset, said:
Only 13% of people live under a liberal democracy with a reserve currency. The remaining 7 billion people live under authoritarianism or weak currencies. Bitcoin is a powerful tool for them.
In addition, another user named Unfettered Nic Carter shared with Frum another possible outcome of the interest rate increase. The user explained: “If interest rates rise, the corporate sector and the government will be insolvent.” Carter then asked: “What do you think is more likely to happen? We bankrupt everything, or do we print out the way?
At the same time, other Twitter users like Lepton939 stated that they agree with BTC’s proposition to provide “freedom from inflation.” However, the user expressed concern about the volatility of encrypted assets:
“Because the price fluctuates a lot, I’m afraid to keep it going. But I guess its true value lies in the scale of illegal transactions it accommodates.”
Nevertheless, other users, such as Jeffrey Smith (Jeffrey Smith), also praised Frum for these comments about Bitcoin.in his tweet, Smith commented:
Exactly. Zero intrinsic value (related to interest rate observation); 100% speculative value (=big fool theory); and environmental chaos. What don’t you like
Although Smith proposed that “gold is very similar,” he quickly explained that, unlike BTC, this precious metal can be used to make jewelry. Then he concluded: “As far as I know, there is no Bitcoin jewelry.”
Do you agree with Frum’s statement that once interest rates start to rise, the value of BTC will collapse? Tell us what you think in the comments section below.
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