Will central banks hold BTC in 2021
Well-known cryptanalyst, trader and head of Aike Capital Alex Kruger tweeted a couple of posts predicting if central banks will start holding bitcoin in 2021
Previously, he was strongly opposed, but now he believes that central banks will be able to transfer part of the reserves to BTC. That is, the first cryptocurrency will become a store of value along with gold.
Moreover, if at least one bank starts holding cryptocurrency, this will have a huge effect on the development of the crypto market. Therefore, the relationship between BTC and gold requires careful study.
Central banks will sooner or later own BTC, Kruger said. The forecast is based on changes in gold demand in 2020. For 10 years prior to this, the demand for gold was stable, but in 2020 interest in it dropped sharply.
Gold consumption has been cut by central banks. And if they invest their assets in bitcoins in 2021, using only 5% of the demand for gold, this will increase the demand for the leading cryptocurrency by more than $ 1 billion.
It follows that it is not profitable for central banks to become bitcoin killers. After all, not a single created national digital currency can become such a store of value.
On the contrary, the goals of central bank digital currencies are to become a viable vehicle for transactions. And BTC will make an excellent digital stablecoin in the future.
To summarize all of the above, it is not certain that central banks will invest in cryptocurrencies this year. Perhaps this will happen in 3-5 years.
It took institutional investors like GrayScale or MicroStrategy 3 years to enter the market. So time will tell if Alex Kruger is right in his prediction.