BNY Mellon's Subsidiary Insight Investment Doubts about Bitcoin as Payment Medium
Annie Li Jun 30, 2021 09:25
Despite the Bank of New York Mellon (BNY Mellon) becoming the first global bank that allows customers to hold, transfer, and issue digital currencies, Insight Investment, a subsidiary of BNY Mellon, reveals its sceptical attitude towards Bitcoin as the means of payment.
Despite the Bank of New York Mellon (BNY Mellon) becoming the first global bank that allows customers to hold, transfer, and issue digital currencies, Insight Investment, a subsidiary of BNY Mellon, reveals its sceptical attitude towards Bitcoin as the means of payment.
Insight Investment stated that Bitcoin might not suit most institutional investors due to its high volatility, low liquidity, governance challenges, and ESG risks, according to a Bloomberg report on June 30.
At the same time, facing uncontrollable resistance and high volatility during regulatory risk review, Bitcoin is more difficult to evaluate than gold, and it is impossible to comprehensively consider various factors to determine whether it can well-hedge inflation risks.
The head of currency solutions of insight Francesca Fornasari, stated in an interview:
"Slow and expensive transactions may also hinder widespread adoption."
The parent company of Bank of New York Mellon has stepped into the cryptocurrency industry since February, but the subsidiary called for caution in investing in assets such as Bitcoin.
Fornasari said that:
"We're skeptical in terms of the ability of Bitcoin to take over as means of payment. At the end of the day, you should be aware of the fact that if you're investing in Bitcoin, there's a whole number of different factors and considerations that are going to affect the value of your investment, that has nothing to do with inflation or inflation hedges."
Since the Bitcoin bear market occurred in 2018, Bitcoin has demonstrated the weakest quarter performance. Bitcoin reached an all-time high (ATH) of $64,854 on April 14 this year, and it has now fallen by half its price.
Bitcoin, the world's largest cryptocurrency with a market cap of $659,031,377,940, was trading at $35,118.37 during the intraday, according to Coinmarketcap.
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