Bitcoin gets likened to hurricane insurance by a crypto fund manager, only that it is half-priced. Travis Kling, who is a crypto fund manager at Ikigai Asset Management, which is a crypto investment firm, stated that Bitcoin is a solution and can be likened as a form of insurance. According to him, it can be insurance against hurricanes and also the US fiscal policy.
According to his tweet on March 20th, there is a hurricane that is yet to hit the US economy and it will have adverse effects. He then suggested that the solution may be Bitcoin, which is currently so affordable with the crypto market crash.
According to Kling, even though the price of Bitcoin is dropping, it can be likened to insurance against the biggest financial experiment in history.
Kling’s tweet is kind of controversial, especially at such a time when people have lost hope in Bitcoin and are questioning its ability to be a safe haven asset. Bitcoin has lost about half of its value, following the downward trend in the traditional market.
Is Bitcoin really safe?
Everyone in the crypto community is very aware of the current recession and its impact on the price of cryptocurrencies. On Jan3, Andreas Antonopoulos predicted that cryptos are likely to crash when the traditional financial assets crash because every aspect of the economy will be affected.
Those sentiments were supported by Anthony Pompliano, who is the co-founder at Morgan Creek Digital, on March 12 arguing that the main cause of the crisis will be due to low liquidity. According to him, the liquidity problem was caused by investors selling their assets at the same time due to panic.
Pompliano added that most assets go through the same phase and gold underwent that phase during the financial crisis in 2008. According to him, that will make governments lower their interest rates as well as promote qualitative easing. That will make the crypto to easily recover from the crisis. That will drive investors to safe haven assets and unique monetary commodities such as Bitcoin.
Kling is not the first one to compare Bitcoin to insurance. Chamath Palihapitiya, the Virgin Galactic chairman also did the same comparison last month.
One thing for sure is that the crypto market will rise once the market recovers from the recession phase. It might, therefore, be a good time to buy the crypto assets.