Moneta's Chief Global Market Strategist, Aoifinn Devitt, has challenged the concept of cryptocurrencies as a safe haven, describing them as 'risky' assets that demand a high tolerance for volatility.
Pressure on the Crypto Market
Ethereum fell sharply by 27% on Sunday, reigniting discussions about the role of digital assets as safe havens during financial stress.
Doubts About Safe Haven Status
Devitt highlighted the uncertainty around how cryptocurrencies will respond to fundamental economic factors such as interest rates and inflation, noting that they act as extremely 'risky' assets.
Bitcoin and Market Perception
While some proponents have labeled Bitcoin as 'digital gold,' Devitt remained skeptical. She noted that even though Bitcoin is perceived as an alternative currency, demand for fiat currencies, notably the U.S. dollar, remains strong.
Devitt underlined that despite the growing accessibility and liquidity of cryptocurrency assets, they do not constitute a safe haven. She cautioned about the market's high volatility.
