According to Fidelity Digital Assets, Bitcoin's "liability" and counterparty risk are enduring characteristics that set it apart..
Asset manager Fidelity Investments predicts that Bitcoin's (BTC tickers down $19,182) future may "stand in stark contrast to the rest of the world."
Fidelity Digital Assets, the company's crypto subsidiary, distinguished Bitcoin from other currencies in a recent study titled "The Rising Dollar and Bitcoin," which was published on October 10.
Bitcoin "does not correspond to the liability of another person:"Report
Fidelity continues to publicly reiterate its faith in the largest cryptocurrency despite the near-year-long bear market, despite the fact that it is no stranger to bullish Bitcoin views.
Analysts discussed how far Bitcoin as an asset has deviated from current standards in the report.The fixed issuance and supply of Bitcoin are especially important in the new environment of high inflation.
They explained, "Therefore, bitcoin may soon stand in stark contrast to the path that the rest of the world and fiat currencies may take – namely the path of increased supply, additional currency creation, and central bank balance sheet expansion." This is the path that the rest of the world and fiat currencies may take.
Although the report's title refers to the strength of the US dollar in comparison to other currencies around the world, Fidelity emphasized the British pound crisis as an event that cannot be measured by Bitcoin.
In conclusion, the company predicted that "more monetary debasement may be required to alleviate the high debt load among developed economies," adding that "recent events in the United Kingdom have shown counterparty and liability risks in the system, making monetary intervention and doses of liquidity features that are not likely to go away any time soon."
It came to the following conclusion: "Comparatively, bitcoin remains one of the few assets that does not correspond to another person's liability," "has no counterparty risk," and "has a supply schedule that cannot be changed."
Fidelity's optimistic assessment of the current state of the Bitcoin network itself diverges from the nervousness of its crypto-sector peers elsewhere. Volatility remains the crypto-sector base case.
According to the company's summary of research for the month of October, network fundamentals and the BTC illiquid supply reached 10-year highs.
Glassnode, an on-chain analytics company, came to the conclusion that Bitcoin's future would likely be marked by volatility, as reported by Crypto Express in its most recent weekly newsletter, "The Week On-Chain."
“With realized and options implied volatility falling to historic lows, the Bitcoin market is ripe for volatility.It concluded by providing a summary of the data points covered. "On-chain spending behavior is compressing into a decision point, where spot prices intersect with the Short-Term Holder cost basis."