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Bitcoin is "Not Mature Enough to Function as an Inflation Hedge" - Scaramucci.

24-Aug-2022 By: Shikha Jha
Bitcoin is "Not Matu

Investors are gradually losing faith in Bitcoin (BTC) as a reliable inflation hedge. Bitcoin used to be frequently hailed as a haven from the effects of macroeconomic conditions on the economy, but it now seems to be losing this reputation. Anthony Scaramucci has remarked that the asset has not yet achieved the status of a reliable inflation hedge in the face of new realities.

Scaramucci believes BTC is still too new to serve as a hedge against inflation.

The CEO of SkyBridge Capital, Scaramucci, spoke on CNBC's Squawk Box on Monday to examine the state of the cryptocurrency markets.

He pointed out that the asset hasn't yet expanded sufficiently to fill the role of an inflation hedge. Scaramucci cited the present wallet bandwidth for Bitcoin as the primary justification for his claim. When he made his first Bitcoin buy, the bandwidth of the currency was around 80 million wallets, he disclosed. He added that there are approximately 300 million wallets worldwide at this time.

Scaramucci added that until wallet bandwidth hits the billion and billion plus level, BTC cannot be used as an inflation hedge. It is still a cutting-edge technological asset, he said. Scaramucci did highlight BlackRock's recent interest in BTC as a sign of rising institutional demand, though, as a positive.

The macro environment has negatively impacted bitcoin.

Anthony Scaramucci continues to be one of the well-known individuals who is optimistic about bitcoin. Speaking with CNBC in October of last year, Scaramucci mentioned that he has over $1 Billion in Bitcoin. The seasoned investor said at the time that he saw BTC as virtual gold.

Any investor who investigates Bitcoin will be compelled to invest in the asset class, according to Scaramucci. He used Ray Dalio as an illustration. Former sceptic Dalio stated that he already owns some Bitcoin in December of last year.

As macroeconomic conditions deteriorate, Bitcoin, which was previously praised for its resistance to inflation, particularly during the turmoil of the COVID-19 pandemic, looks to be collapsing alongside traditional stocks. This abrupt development has been linked by market observers to BTC's recent association with conventional finance.

At the time of writing, the asset is trading at $21,203, down 11.2% over the previous week.

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