Research arm of $670 billion asset manager AllianceBernstein lauds bitcoin as ‘safe haven’

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Bitcoin, the world’s largest cryptocurrency, is a “safe haven asset” that consistently outperforms gold, with bitcoin now boasting better returns than the precious metal, according to a recent memo from Bernstein Research, an analytical division that is separate from but owned by Nashville-based global asset management firm AllianceBernstein, which manages some $670 billion.

Despite the punishing crypto winter of 2022 and high-profile implosions of FTX, Three Arrows Capital, and the Terra-Luna stablecoin, Bernstein Research cited bitcoin’s recent three-year spike in prices, which have reached a growth percentage as high as 150% at times. In fact, the company said, bitcoin’s market performance has beaten that of gold in the last five years, making it an ostensibly superior asset to back.

“Since its inception, bitcoin has consistently outperformed gold,” Bernstein Research said this month in a memo sent to TheStreetCrypto. “Over [the] last 3 years, gold has been flat, while bitcoin is up 150% (despite the 60% drawdown in 2022).”

If more investors come to agree with Bernstein Research, and bitcoin were to consume gold’s $13 trillion market cap, the price of each bitcoin in circulation would reach about $650,000.

Gold only acquired an exchange-traded fund (ETF) in the U.S. in November 2004, which some analysts believe played a pivotal role in gold’s appreciation over an eight-year period. According to Oppenheimer Asset Management’s John Stoltzfus and Matthew Naidorf, the price of gold rose just 16.84% prior to the gold ETF, but after the fund’s arrival, gold prices spiked 286.90%.

Similarly, bitcoin is on track to win approval for an ETF soon, after months of stalling by the U.S. Securities and Exchange Commission (SEC). With the SEC opting not to fight a ruling in favor of Grayscale’s ETF, many companies are now jockeying to claim the crown of first spot bitcoin ETF.

“I’m going to let each of these crypto exchange cases speak for themselves, and they’re in front of jurists,” said SEC chairman Gary Gensler this week. “They’ll play themselves out where they play themselves out.”

“The inaccessibility of crypto wallets and the treacherous track record of exchanges, has made bitcoin inaccessible to the mainstream. The bitcoin ETF would make Bitcoin accessible in broker accounts, well integrated with private banks and wealth managers/advisors,” Bernstein Research wrote, sending a positive signal that an unveiling of a spot bitcoin ETF might only herald mainstream adoption after the tumult of 2022.

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Edmund Shing, PhD

Global Chief Investment Officer
BNP Paribas Wealth Management

Edmund has over 29 years of experience in financial markets in a wide variety of positions, ranging from proprietary trading to portfolio manager in a number of financial institutions in London and Paris.  He previously held the role of Global Head of Equity and Derivative Strategy at BNP Paribas in London from 2015 to 2020, and has been Chief Investment Officer at BNP Paribas Wealth Management since November 2020.

Edmund is responsible for piloting our investment strategy and will continues to rollout out recommendations and themes with actionable advice that brings our expertise to our clients and support to our client-facing teams.  In this time of change, his expertise in following and anticipating markets is a true value added for both our customers and those at Wealth Management who serve them.

Edmund has a PhD in Cognitive and Computing Science from the University of Birmingham in the United Kingdom, and has done advanced studies in Knowledge-Based Systems and in Experimental Psychology.  He is an EFFAS-certified financial analyst. He has also authored the book “The Idle Investor” published by Harriman House in 2015, proposing 3 simple investment strategies that take only a few minutes to execute per month.

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