bitcoin disaster hedge 3

Markets Using Bitcoin as a Disaster Hedge

ARK Invest Blockchain Products Lead, Chris Burniske, sits down with CNBC to discuss markets using bitcoin as a disaster hedge in relation to the Brexit vote.

“What we’ve been seeing with bitcoin, generally, is capital market investors are using it as a disaster hedge. We saw this in summer of last year with the Greek debt crisis. Bitcoin trading volume spiked and the price enjoyed a sustained rise. We also saw it late last year with fear of the Chinese devaluing the yuan, and we saw it with Brexit this year.”

“I think we will continue to see capital market users really turning to bitcoin as a disaster hedge due to its low correlation of returns with other capital market assets.”

“In the long-term, when you look at bitcoin’s stellar absolute returns, its dropping volatility, and its superior sharpe ratio (better returns per unit of risk taken), its been a great long-term asset. ARK really sees bitcoin as a long-term play.”

“Just as voice over IP revolutionized voice communication, bitcoin as money over IP is revolutionizing the transfer of value. So you are seeing a lot of people open up to its utility as a technology and an asset. This is something ARK covered in our recent white paper, Bitcoin: Ringing the Bell For A New Asset Class.”

All statements made in this article are direct quotes from the interview with Chris Burniske. Click here to view the full broadcast.

ARK's statements are not an endorsement of any company or a recommendation to buy, sell or hold any security. For a list of all purchases and sales made by ARK for client accounts during the past year that could be considered by the SEC as recommendations, click here. It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities in this list. For full disclosures, click here.