Crypto assets are tracing a path back onto investors’ radar, notes Fred Pye, CEO and Chairman of Canadian investment fund 3iQ Corp. Anticipating the further pivot to crypto, he suggests that what’s happening at the present moment is only accelerating the crypto revolution.
According to Frederick Pye’s opinion column on Gulf News, the conflict in Ukraine is creating far-reaching consequences not just in Ukraine and Russia but throughout the rest of the world.
Lives have been lost, millions are seeking refuge in neighboring nations, and the rhetoric surrounding the conflict is teetering between peace and escalation with the sentiment shifting from moment to moment, the 3iQ head says.
As per Pye, the Ukraine and Russia situation certainly makes investors nervous. At any given moment, it could escalate, and markets will no doubt respond negatively should that happen. Investing markets don’t like uncertainty. That includes the market for digital assets.
However, the situation does demonstrate the value and long-term growth potential of digital assets and the role they play during difficult times, politically and economically, he says.
Pye sees the long-term future for digital assets as still bright. Institutional capital continues to flow into Web 3.0. Ethereum’s transition to a proof-of-stake consensus algorithm is still going to be completed later this summer, and Bitcoin’s next halving event is still going to happen in less than two years.
3iQ CEO says his company’s position that these occurrences will likely only increase the long-term value of digital assets as a whole. As time passes, greater clarity on the fallout resulting from the conflict in Ukraine and higher inflation rates will begin to reveal itself; Pye suggests that investors will eventually gain confidence in ‘risk-on’ assets again.
As the market capitalization of Bitcoin is sitting at over $900 billion, with the weight of the economic sanctions the Western world has levied on Russia, the Russian ruble is now worth approximately $625 billion, just two-thirds of the value of Bitcoin, the 3iQ head notes.
Pye does not doubt that economic sanctions are driving crypto prices higher. If Russians can’t trust their own government-issued currency, what better alternatives will they have? Not surprising that Russia’s young professionals leave the country in search of greener economic pastures. Those that can’t are likely to look towards digital currencies as a safe haven, he says.
Pye foresees the EU will likely place further economic sanctions as the next steps in continuing to deter Russia’s aggression. As well as, European nations will be forced to move away from Russian oil and gas as the conflict in Ukraine rages on.
Therefore, even before the conflict began and well after it concludes, more nations, institutions and retail investors will continue to see the value of protecting capital by investing in digital assets.
Anticipating the further pivot to crypto, Pye suggests that the asset class is going to be a big part of the future, and what’s happening at the present moment is only accelerating the cryptocurrency revolution.