Niall Ferguson is an author and the developer of a television series known as “The Ascent of Money.” In a recent interview, he comments why bitcoin is such a huge asset right now and why it’s arguably the best asset to have once the coronavirus pandemic is over.
Niall Ferguson: Bitcoin Is the World’s Top Asset
I’m going to go with bitcoin. It has had a stellar year, up 165 percent year to date. It’s now above $19,000. If, at the beginning of the year, you had said, ‘The pandemic is coming. It’s going to be very disruptive. Should I choose gold or bitcoin?’ You would have been right to choose bitcoin because gold is up only 21 percent. So, bitcoin returns have been an order of magnitude higher.
He further stated that history usually tends to repeat itself. He comments that things like this have happened in the past, such as the Black Death in the 1300s in Europe. That pandemic caused many people to begin switching to the use of coins. He says that ever since the coronavirus hit our financial markets, more and more institutional players and top-of-the-line financial figures have stated that they are looking to take bitcoin seriously. He believes this won’t change anytime soon.
He also states that adoption rates tend to be very up and down no matter what, so even though there are still many doubters out there, this shouldn’t deter people from getting involved considering doubters are likely to exist no matter what the circumstances may be. He mentions:
You could argue, if you were a skeptic like my old friend Nouriel Roubini, that this is just another bubble, but the adoption of a new financial technology tends to be quite volatile, and each time bitcoin rallies and then folds, it folds to a higher level than the time before. So, you could probably take a little bit of a downside risk but hold bitcoin for a year to five years and feel rather good about it.
The Rich Really Want It, Now
He says that so long as the rich and powerful continue to view bitcoin in the light that they do now, and if institutional players continue to invest in it, the price of bitcoin is likely to reach the moon and the stars. He states:
In a new edition of my book ‘The Ascent of Money’ two years ago, I observed that if all the millionaires in the world collectively decided to hold 0.2 percent of their assets in bitcoin, the bitcoin price would be $15,000, which it reached this year. If it was one percent, then the price would be $75,000 per bitcoin. So, as people adopt this as a new form of asset that has a respectable place in a diversified portfolio, there is still quite a bit of upside.