Bitcoin has once again surged to record-breaking highs in 2024, propelled by the recent halving event and the green light from the Securities Exchange Commission (SEC) for the bitcoin spot exchange-traded fund (ETF). This momentous occasion not only signifies a significant reduction in the issuance of the leading cryptocurrency but also underscores its growing recognition as a legitimate store of value.
Thales Freitas, CEO of Bitso, a prominent Mexican exchange, shared insights into Bitcoin’s journey and the implications of recent developments during a discussion with Investing.com Brasil at the Web Summit Rio.
Reflecting on the historical trajectory of Bitcoin, Freitas noted key differences in this year’s rally, attributing the current sideways trading between $65,000 and $70,000 to the prevailing global liquidity conditions, particularly influenced by U.S. interest rates.
Commenting on Bitcoin’s status as an asset, Freitas emphasized its inherent scarcity, asserting that regardless of market fluctuations, Bitcoin remains a coveted and finite resource. Amid concerns surrounding escalating U.S. debt levels, Freitas expressed optimism about Bitcoin’s potential as a hedge against inflation, foreseeing a sustained demand for the cryptocurrency.
Addressing Bitcoin’s role as a store of value amidst fluctuating market conditions, Freitas acknowledged the impact of external factors such as interest rates but highlighted the increasing involvement of institutional players and the dwindling supply of Bitcoin as factors likely to mitigate volatility in the long run.
Drawing parallels between Bitcoin and prime real estate, Freitas likened the cryptocurrency to a valuable asset in a sought-after location, particularly emphasizing the significance of the SEC‘s ETF approval as a validation of Bitcoin’s long-term viability.
Discussing the prospects of altcoins amidst the Bitcoin rally, Freitas revealed a cautious approach, with a majority of his personal portfolio allocated to Bitcoin. While acknowledging the potential of innovative altcoin projects like Solana, he noted a recent deviation from traditional altcoin cycles, with memecoins and certain NFTs gaining prominence over altcoins.
Despite the evolving landscape, Freitas underscored the importance of Bitcoin as the benchmark asset, advocating for a diversified portfolio approach that incorporates select altcoins alongside the flagship cryptocurrency.
