Bank Of America Analysts Slam Bitcoin: Buying 1 Btc Is ‘like Owning 60 Cars’

The year 2017 is considered to be the bitcoin condemnation period. Many analysts from Bank of America criticized BTC. It slammed bitcoin to be highly volatile and impractical. It is also known to be the asset that is disastrous. It is never considered as a wealth that can be stored or have an inflation hedge. The report also stated that cryptocurrency is not a viable method to make payments to people as it can only handle around 1400 transactions for every hour when compared to the transactions that are processed by visa. It can process around 230 million transactions.

There is a strong decision that is taken by the traditional financial institutions against this cryptocurrency. This decision would be in contrast to the decisions of the major banks such as Goldman Sachs and JPMorgan, which has considered bitcoin to be one of the assets. There is a notion that there are only 21 million bitcoins available globally. This is what will eventually result in the increase of the price of this cryptocurrency over a period of time. However, the price of bitcoin would be based on the supply and demand. It is clear that the supply of these coins would remain the same, but the demand for it would vary. This is what would be having a huge impact on the pricing. The author named Francisco Blanch has never considered the idea of bitcoin being a safe asset. This is categorized as an asset with a lot of risks though is not linked to inflation and would remain volatile. It is not possible for p people to store this as wealth.

The main thing that comes as an argument in bitcoin is not about diversification, stable returns, inflation protection, but it all about the appreciation of its price. The investors who have invested in this cryptocurrency are worried about the returns. When the track record of bitcoin is viewed for the past ten years, the price has been appreciated. This can dismiss all the annoying facts that are enveloping around it. When bitcoins are considered to be posing a negative impact, it poses threat to increase in the adoption from corporate and institutions. The shareholders are very conscious about the risks. The bitcoins will have a higher carbon footprint when compared to the human activities, like dollar to dollar flow. The energy usage by bitcoins has increased to 200% in the last two years in countries such as the Netherlands, Greece and Czech Republic.

There are many bitcoin miners who stated that mining of bitcoins would use only renewable sources of energy from 39% to 76%. The bitcoin mining would mostly happen in China where the electricity is produced by coal. Half of the mining happens in Xinjiang state of China where 80% of the power would be produced from coal. Increase in pricing would add up to the mining challenges, which adds a lot to the carbon output.

Investing around USD 1.2 billion in bitcoins would produce carbon emissions as produced by 1.2 million cars. The Tesla investment of USD 1.5 billion is equal to running 1.8 million petrol based cars.

Leave a comment