Bitcoin (BTC) is still in the process of emerging from last year’s crypto winter, a situation that saw some attention move away from the maiden cryptocurrency. The uncertainty regarding the general economy has also compounded Bitcoin’s recovery.
Despite the uncertainty, 400-year-old German investment bank Berenberg has stated that Bitcoin is set to reclaim the spotlight in the world of cryptocurrencies and general finance sector after fading in the wake of bear market, Coindesk reported on April 28.
Interestingly, the bank acknowledged that Bitcoin’s status in the crypto market had been relinquished to other digital assets and projects in recent years.
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The bank’s bet on Bitcoin is rooted in a research report that outlines several factors that could elevate the cryptocurrency’s status in the coming months. The report sheds light on the increasingly stringent regulatory environment in the United States, which puts almost every token at risk of being classified as a security and subjected to enforcement action.
However, Bitcoin’s unique design, characterized by decentralization and transparency, makes it an exception to this regulatory crackdown.
The report comes at a time Bitcoin has experienced a price rally in recent weeks, with the asset partly inspired by the US banking crisis. Therefore, the bank views the rally as a sign that more investors are considering Bitcoin as a ‘sensible alternative’ among digital assets and the general finance sector.
Benefits from global de-dollarization
Furthermore, the lender suggested that with other global economies attempting to abandon the dollar as the world’s reserve currency, Bitcoin’s value proposition as an alternative to traditional currencies may rise.
The report also notes that the next Bitcoin halving, slated for May 2024, is another possible catalyst for a Bitcoin rally.
“If history is any guide, then Bitcoin could rally ahead of and after this much-anticipated halving,” the report said.
Finally, the bank emphasized the growing importance of the Bitcoin blockchain and how the widespread adoption of the Lightning Network has demonstrated it. Notably, the Bitcoin Lightning Network is a second-layer solution for the Bitcoin blockchain that enables almost-instant transactions with low fees.
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