Here’s How Many Wallets Is Needed For Bitcoin To Be An Inflation Hedge

Bitcoin’s most important selling point is its ability to beat inflation rates. It has been referred to as the “digital gold” because a large portion of the community believes that bitcoin is an inflation hedge better than any other asset. But not all bitcoin supporters believe that bitcoin is an inflation-hedge. Anthony Scaramuccci, CEO of Skybridge Capital is one of them. Here is what he thinks.

We need more wallets

Since its inception over a decade ago, bitcoin has seen a tremendous rise. It is no surprise that bitcoin is being compared with other assets that have been around longer. Gold, which was previously the preferred inflation hedge for investors, is one of them.

However, BTC has become more popular and can now be registered as an inflation hedge. Anthony Scaramucci, despite many people believing that BTC is an inflation hedge, doesn’t believe so. It all boils down to how the cryptocurrency was adopted.

Scaramucci stated during an interview on CNBC’s Squawk Box, that although bitcoin could be used as an inflation hedge it is far from being one. The CEO explained that this is due to the fact that there are still less than one billion bitcoin wallets.

Currently, there are approximately 300 million bitcoin wallets. However, Scaramucci states that Bitcoin wallets cannot be considered an inflation hedge until they reach the 1 billion mark.

Bitcoin Is Still Too Immature

Bitcoin is still a young asset, despite being around for just 13 years. The fact that bitcoin is a digital asset adds an additional layer of uncertainty to the equation. Scaramucci also points out this immaturity.

He said that BTC is not an inflation hedge because of its infancy as a technical asset. This does not mean that cryptocurrency is unrealized in its potential.

Investors have found bitcoin’s limited supply to be a major draw. Scaramucci even pointed out this fact as one of the main arguments for BTC. He believes that bitcoin will eventually rival or even surpass gold, which is thousands years old. This is mainly due to bitcoin’s ease of movement and storage.

According to current estimates, less than 5% hold bitcoin. ARK Invest CEO previously stated that bitcoin could reach $500,000. If 5% of institutional funds were moved into bitcoin.