Dr Shane Oliver, Head of Investment Strategy and Chief Economist takes a look at Bitcoin which has had nearly a 15 fold increase in price from its low last year.
The key points are as follows:
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Digital currencies and blockchain technology may have a lot to offer – but that does not mean Bitcoin will be it.
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Due to extreme volatility, high transaction costs and slow processing, Bitcoin does not cut it as digital cash.
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But it’s not an asset generating cashflows either, which makes it impossible to value.
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The key for investors is not to invest in something if you don’t understand it and to recognise that just because Bitcoin has surged in price does not prove its worth.
Download pdf copy – Oliver’s Insights: Bitcoin – it’s not a currency, it’s not a capital asset… so what is it?.
If you would like to discuss any of the issues raised by Dr Oliver, please call on Phone (02) 4365 4275