This is a guest opinion post from Alvin Chia, Northern Trust SVP, Head of Digital Assets Innovation (APAC) and Dr Sizheng Fan, Senior Research Scientist at Harvest Global Digital Asset.
Bitcoin’s stunning rally in 2024, driven in part by a wave of bitcoin exchange-traded funds (ETFs) launched in the U.S. following regulatory approval in January, has convinced even the skeptics that the cryptocurrency is here to stay. While cryptocurrency is just one of the many digital assets, its implications for the broader asset class remain uncertain.
Not long ago, proponents of digital assets saw a revolution, with bitcoin being the most popular example of technology that has the potential to permanently change how we use and store money.
We hear less talk of radical change in the current rally, as bitcoin is seen primarily as a speculative trading asset, made accessible to retail investors through regulated fund structures. Previous bitcoin bull runs, followed by the bursting of a speculative Non-fungible Token (NFT) bubble in 2022, the collapse of FTX and the tightening of government regulations across the globe last year, had cooled public interest before the current rally, while more exciting – and easier to use –inventions like ChatGPT captured popular attention.
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