According to a recent report by Morgan Stanley, Bitcoin is no longer viewed as a traditional currency, but rather as a speculative asset.
While Bitcoin was originally designed to function as a decentralized means of carrying out transactions and storing savings without the need for an intermediary, it is now heavily influenced by the traditional banking system.
The report notes that Bitcoin’s value is supported by bank liquidity in US dollars, and therefore it is seen as a speculative asset rather than a currency.
Despite this, many holders of the cryptocurrency still view it as a way to protect themselves from the risks associated with traditional banking.
However, the purchasing power of Bitcoin is still subject to the policy decisions of the US Federal Reserve.
If Bitcoin were to operate solely in line with its original purpose of being a decentralized currency, its value would likely rise amidst the current banking uncertainty.
Recently, Bitcoin has shown signs of recovery amidst the crisis in the banking industry, with the cryptocurrency briefly surpassing $26,000.
Charles Edwards, founder and CEO of investment firm Capriole, believes that Bitcoin could soon experience a significant price jump, reaching $100,000.
Wallet holders with a balance between 10 and 10,000 BTC have reportedly added over 40,000 coins to their accounts, amounting to $821.5 million, as the price of Bitcoin has dropped to $20,000.