Are Crypto's now one of the Stability Pillars?
In traditional Finance (TradFI), there we two to three stable pillars (AKA Safe Havens) that one could sell assets and then purchase in turbulent times that provided supreme level of safety. Perhaps not always the best return but safety can help you rest well at night. The tried and true pillars have been: US Treasuries and Gold. With the Tariff tantrums going on here in the US, the US Treasuries have been whipsawing investors even defying traditional notions that rates should be dropping and they are rising! Unless you have had your head under a rock the last 3-4 months you have witnessed Gold meteoric rise to several consecutive fresh all time highs (ATH). Did you buy some? Come on admit it you allowed FOMO to win right, I knew it.
What do I mean by Stability Pillar?
I currently view them as 'Safe Havens', that bring a level of comfort from high risk assets and markets. Over the past 3-weeks have you noticed how Crypto, lead by BTC of course, seem to be bucking the massive drawdowns bringing pain to nearly every corner of the world. This makes me wonder, is Crypto now a Stability Pillar like the old stalwarts? And this upward trend does NOT just apply to BTC its been a wide swath of Alt-coins as well. One finance rule I learned back during the lock-downs era was money flows to where it is treated best! Sure seems like Crypto's fits that requirement at this point in our cycle. Do you agree? Are you doing it and just not telling your friends yet?
Does this mean we are changing the monetary Order?
Nope, I promised myself I was not going down the de-dollarization route again. I believe current crypto offerings provide an option for countries such as Japan, China, Russia and others the ability to sell their US Treasuries and move the capital into something designed to avoid sanctions and political whims. Hmm, did I read that somewhere as part of their design? I just don't recall where. Perhaps you can remind me down in the comments where to refresh my memory.
Summary
The TradFi stalwarts still bring safety and perhaps they are still the go-to for those that still believe Crypto is snake oil. On the other hand we have an entire new class of investments (notice I didn't call them securities, just in case our friend Gary G is still lurking hoping to get rehired at his old job). As Crypto continues to evolve countries might evolve and take advantage of Crypto reserves to balances our national treasuries. This will not happen overnight but I think its entirely possible.
Credit - BLOG image - finance.gov.capital = ALL RIGHTS REMAIN
