Proponents of the uniquely volatile commodity argue it is a valuable hedge against inflation, similar to gold.
Many bitcoin enthusiasts and investors are quick to criticize government-backed currencies as prone to devaluation and say increased government buy-in will stabilize bitcoin’s future price swings, give it more legitimacy and further boost an already rising price.
But the risks are significant. Critics say a crypto investment is highly speculative, with so much unknown about projecting its future returns, and warn that investors should be prepared to lose money.
Only a couple public pension funds have invested in cryptocurrency and a new U.S. Government Accountability Office study on 401(k) plan investments in crypto, issued in recent days, warned it has “uniquely high volatility” and that it found no standard approach for projecting the future returns of crypto.
It has already been a landmark year for crypto, with bitcoin hitting $100,000, the U.S. Securities and Exchange Commission approving the first exchange-traded funds that hold bitcoin and crypto enthusiasts being cheered by Trump’s promise to make the United States the “bitcoin superpower” of the world.
MORE LEGISLATION ON CRYPTO COULD BE COMING
Lawmakers in more states can expect to see bills in 2025 to make them crypto-friendly as analysts say crypto is becoming a powerful lobby, bitcoin miners build new installations and venture capitalists underwrite a growing tech sector that caters to cryptocurrencies.
Meanwhile, a new crypto-friendly federal government under Trump and Congress could consider legislation from Sen. Cynthia Lummis, R-Wyoming, to create a federal bitcoin reserve on which states can piggyback.
This story is from the December 21, 2024 edition of Techlife News.
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This story is from the December 21, 2024 edition of Techlife News.
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