Main navigation

Ark’s Cathie Wood Says Bitcoin Could Be Today's Gold Standard

News
Sun, 04/11/2021 - 20:08
article image
Alex Dovbnya
Ark’s Cathie Wood claims Bitcoin is increasing purchasing power, calling it today's gold standard
Ark’s Cathie Wood Says Bitcoin Could Be Today's Gold Standard
Cover image via twitter.com
Read U.TODAY on
Google News
Contents

In a series of recent tweets, Cathie Wood, the CEO of asset management company Ark Invest, claims that Bitcoin could be today’s gold standard because of its ability to increase purchasing power.  

Most countries were adhering to the gold standard in the early 20th century before abandoning it after the Great Depression.   

Blockchain is the new electricity

Wood is convinced that the current technological progress “dwarfs” that of the late 18th century, naming blockchain and artificial intelligence among some of the examples of cutting-edge tech.

Her new Twitter thread is meant to address Tesla CEO Elon Musk’s concerns about the unusually high S&P 500 to GDP ratio.     

The superstar fund manager says that disruptive technologies tend to be deflationary due to Wright's Law. Rapidly increasing productivity is increased earnings while near-zero interest rates are pushing the S&P 500 much higher:

Technology-enabled platforms are deflationary thanks to learning curves, or Wright’s Law. The Gold Standard also was in force...As deflation pressured an increasingly difficult-to-measure nominal GDP (the denominator), exponential unit growth and rapid productivity gains increased the quality of earnings while low interest rates boosted their capitalization (the numerator).

According to Wood, the stock market was up to three times higher relative to GDP in the early 20th century.

Related
As Bitcoin Rallies Back to $51K, Ark's Cathie Wood Says She's "Very Positive" on It

Bitcoin could eclipse gold

Wood certainly knows a thing or two about disruptive technologies since she embodies the most recent speculative mania that has already surpassed the dot.com craze in the late 90s.
Undeterred by haters, she has become a cult-like figure in the investment community. 

In February, Ark Invest hit $50 billion in assets under management, which marked a major milestone for the fund that profited big off Tesla’s rally.

Ark’s crypto asset analyst Yassine Elmandjra claims that Bitcoin could one day eclipse the market cap of gold:

If you look at gold as a $10 trillion market cap, bitcoin is about 10 percent of that, and if we believe bitcoin is a 100 times better version than that, then it’s fairly safe to say that there’s a stark chance that bitcoin captures a lot of gold and market share, and more.    

article image
About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.