Fidelity Digital Assets, a subsidiary of Fidelity Investments focused on digital assets, has published a new report titled "Bitcoin Investment Thesis: an Aspirational Store of Value," in which the crypto-focused arm explains why bitcoin outperforms other assets as a store of value.
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Since Bitcoin’s scarcity was coded into the protocol when it was created, one of its most novel innovations is its "unforgeable digital scarcity."
"Scarcity is the key characteristic cited in reference to a good store of value as it is essential for protecting against the depreciation of real value in the long run," the report says.
Fidelity Digital Assets admits bitcoin (EXANTE: Bitcoin) is "relatively nascent" and yet has limited demand compared to a global store of wealth such as precious metals.
However, the rationale of investors for establishing exposure now is that it will be a much larger market if it is widely used as a store of value in the future, the company highlights.
"To achieve considerable status, more investors need to become knowledgeable about bitcoin’s inherent properties and determine that the benefits of storing at least some value in bitcoin are superior to the opportunity costs of storing value in a different medium," Fidelity Digital Assets added.
Fidelity also forecasts bitcoin will likely meet the global adoption once the massive transfer of wealth from the older generation to a younger demographic is over, as younger people view bitcoin "more favorably."
Earlier, iHodl reported that according to Fidelity Investments, over 30% of institutional investors own cryptocurrencies such as bitcoin.
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