The vision of Bitcoin absorbing the entire world’s capital float is a compelling story, but it runs headlong into key technical constraints. Bitcoin will not realize this great potential unless mechanisms are created to move and utilize capital directly on the network.
Why Bitcoin Can’t Absorb Global Wealth Overnight
Analyst British Hoddle presents a strong thesis on the role of BTC, arguing that its impact goes far beyond independent assessments and is fundamentally changing the way global capital is allocated. at x postThe British HODL said that while BTC aims to absorb the world’s capital, this is conditional and BTC will not capture all capital flows on the planet unless they are redirected to the BTC network.
However, as BTC becomes more widely understood, capital becomes very sensitive and only the highest quality stocks attract capital. This is simply an existing one, long term A trend evidenced by the dominance of a select few, such as the Magnificent 7 Stocks (MAG7) stocks in the traditional market over the past 30 years.
Bitcoin reinforces this trend as it provides a highly accessible and transparent standard for risk-free returns. As the risk hurdle rate increases, investor No longer satisfied with meager profits from low-quality assets.
The result of this is important market Cleaning and a lot of intensive value-creating innovation as companies are forced to deliver exceptional performance to acquire capital. On the other hand, there is a very fast turnover of terrible companies as BTC’s value proposition becomes increasingly understood by investors. UK Hodl makes it clear that in the era of dominating BTC, it needs to outperform BTC on a risk-adjusted basis to capture capital.
Growing view of Bitcoin as alternative money
Billionaire investor Ray Dalio, founder of Bridgewater Associates, maintains a balanced and skeptical view of Bitcoin, acknowledging its growing influence while pointing out fundamental flaws that prevent ultimate adoption by nation-states.
Dario start By stating that although it is not possible to say exactly how effective BTC is as money, the fact that it is perceived by many as an alternative money is worth paying attention to. He frames the utility of any currency as both a medium of exchange and a store of wealth, emphasizing that the latter is more important.
in spite of Its innovative technology, Dalio is highly doubtful that central banks will take it over as a reserve currency. However, for all transaction Public, but no privacy. This is unacceptable for a sovereign entity that controls vast financial operations. As a result of future risks, the code may break and become less effective through government control. Experts confirm that he has BTC in his portfolio, but not in significant amounts.
Featured image from Pixabay, chart from tradingView.com