Charles Schwab’s chief investment strategist says she puts faith in the entire U.S. financial system, the banking system, the power of the central bank, and the Federal Reserve more than bitcoin.
Charles Schwab’s Strategist Skeptical of Cryptocurrency
Charles Schwab Chief Investment Strategist Liz Ann Sonders shared her thoughts on cryptocurrency and the U.S. financial and banking systems on a Yahoo Finance webinar last week.
The Wall Street strategist explained that she trusts the U.S. financial system more than she trusts cryptocurrency miners, stating:
I still put some faith in the entire U.S. financial system, the banking system, all of its protections, as well as the power of the central bank, the Federal Reserve, to sort of control the fiat currency that is also the global monetary standard and the world’s reserve currency — versus, say, bitcoin miners.
Regarding cryptocurrency, she said: “I am an admitted skeptic to some degree. I’m not on either end of the spectrum, meaning I’m a skeptic but I’m not [saying] this is complete nonsense.”
She explained that she has been asking one question for a long time, “which is what problem is this solving for?” However, the strategist said, “I have yet to get a very compelling answer.”
Commenting on using bitcoin as an inflation hedge, she noted that the cryptocurrency has been around since 2009 but “the only burst of inflation that we’ve gotten since that period of time was during a three-month period where bitcoin was cut in half. So you sort of lose that argument.”
The strategist proceeded to raise concerns about bitcoin’s “concentration,” which she considers a significant threat. “The latest data that I’ve seen is the top 2% of bitcoin holders own somewhere between 90% and 95% of bitcoin. And then there’s leverage associated with a lot of this,” she described. The strategist cited “The implosion of Melvin Capital with Gamestop” and “The implosion of Archegos and stocks like CBS Viacom” as examples of what concentration issues could lead to.
Noting that crypto could have “underestimated” risk factors, she opined:
I think that thread of leverage and concentration arguably can weave its way through a lot of these areas where you’ve seen tremendous amount of speculation.
What do you think about the comments by the Charles Schwab strategist? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Charles Schwab’s chief funding strategist says she places religion in your complete U.S. monetary system, the banking system, the facility of the central financial institution, and the Federal Reserve greater than bitcoin.
Charles Schwab’s Strategist Skeptical of Cryptocurrency
Charles Schwab Chief Funding Strategist Liz Ann Sonders shared her ideas on cryptocurrency and the U.S. monetary and banking programs on a Yahoo Finance webinar final week.
The Wall Road strategist defined that she trusts the U.S. monetary system greater than she trusts cryptocurrency miners, stating:
I nonetheless put some religion in your complete U.S. monetary system, the banking system, all of its protections, in addition to the facility of the central financial institution, the Federal Reserve, to kind of management the fiat foreign money that can be the worldwide financial normal and the world’s reserve foreign money — versus, say, bitcoin miners.
Relating to cryptocurrency, she mentioned: “I’m an admitted skeptic to some extent. I’m not on both finish of the spectrum, that means I’m a skeptic however I’m not [saying] that is full nonsense.”
She defined that she has been asking one query for a very long time, “which is what downside is that this fixing for?” Nevertheless, the strategist mentioned, “I’ve but to get a really compelling reply.”
Commenting on utilizing bitcoin as an inflation hedge, she famous that the cryptocurrency has been round since 2009 however “the one burst of inflation that we’ve gotten since that time frame was throughout a three-month interval the place bitcoin was reduce in half. So that you kind of lose that argument.”
The strategist proceeded to lift issues about bitcoin’s “focus,” which she considers a major menace. “The newest information that I’ve seen is the highest 2% of bitcoin holders personal someplace between 90% and 95% of bitcoin. After which there’s leverage related to loads of this,” she described. The strategist cited “The implosion of Melvin Capital with Gamestop” and “The implosion of Archegos and shares like CBS Viacom” as examples of what focus points might result in.
Noting that crypto might have “underestimated” threat components, she opined:
I believe that thread of leverage and focus arguably can weave its approach by way of loads of these areas the place you’ve seen large quantity of hypothesis.
What do you consider the feedback by the Charles Schwab strategist? Tell us within the feedback part beneath.
Picture Credit: Shutterstock, Pixabay, Wiki Commons
