Why Investment Maven Cathie Wood Hails The Crypto As ‘Digital Gold’

Bitcoin continues to gain support despite the implications drawn from Sam Bankman-Fried’s fraud case, which could reinforce the arguments of its detractors. Cathie Wood, CEO of Ark Investment, stands firm in her support for the leading digital currency, advocating for its continued prominence in the virtual asset realm.

According to the ARK top honcho, as reported by Bloomberg, Bitcoin is considered a superior hedge against deflation when compared to gold or cash. The speaker underscored the role of the top crypto as a safeguard against inflation and deflation, attributing this to the absence of counterparty risk and the relatively limited participation of institutions.

During her appearance on Bloomberg’s “Merryn Talks Money” podcast, Wood underscored the attributes of Bitcoin that align with the concept of “digital gold.”

The CEO’s Vision: Convergence Of AI And Bitcoin

Over recent years, the Wood has consistently forecasted a potential decrease in prices, largely attributing it to the rise of emerging technologies like Artificial Intelligence, robotics and blockchain. However, despite ongoing efforts by the United States Federal Reserve to combat inflation since March 2022, the CEO remains steadfast in her conviction that deflation is on the horizon.

She said:

“We’re already beginning to witness signs of deflation, and we’ll likely see more of it before this situation concludes,” suggesting that, based on her assessment, the current period resembles the 1910s more than the 1970s.

During the podcast, Wood shared her foresight concerning an anticipated convergence between AI and the cryptocurrency, envisioning a transformative landscape that will facilitate micro-tasks on a global scale.

She anticipates a redefined division of labor facilitated by this convergence, emphasizing that the potential innovations will surpass the public’s current mindset. This amalgamation is expected to revolutionize the efficiency and reach of global labor dynamics, presenting opportunities for tasks and roles that are beyond the scope of our current comprehension.

Wood believes Bitcoin can transform global work and labor dynamics. This opinion compares the crypto’s revolutionary power to gold’s historical significance, emphasizing its digital stability and value. Her vision shows Bitcoin’s ability to transform global finance.

BTC market cap currently at $680.965 billion on the daily chart: TradingView.com

ARK’s Strategic Moves In The Cryptocurrency Market

ARK stands out among esteemed asset management firms strategically positioned to capitalize on the potential approval of a Spot Bitcoin ETF. As part of this initiative, Wood’s company has submitted its own application for a spot Bitcoin ETF, joining forces with 21Shares in this endeavor.

Additionally, they have invested in the Grayscale Bitcoin Trust (GBTC), indicating their commitment and belief in the prospects and growth potential of the cryptocurrency market through various investment avenues.

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Wood recognized the roles of both the precious metal and Bitcoin as defenses against deflation but highlighted the recent outperformance of the cryptocurrency. She noted that Bitcoin has shown stronger performance, emphasizing the limited involvement of institutions in the cryptocurrency market.

Wood also pointed out the preference of younger demographics for holding Bitcoin over the yellow metal, signifying a generational shift in investment preferences towards digital assets.

ARK bought an extensive amount of GBTC shares in November of last year, when they were selling at a 40% discount. Because of this big buy, Wood’s company now has the most shares in the fund. The asset manager has made about 224% so far, even though it sold some GBTC shares last month.

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