Not surprisingly, my previous tweets on bitcoin were misinterpreted by many. I didn´t predict the demise of bitcoin. I just pointed out that bitcoin changed its nature. From an initial aim of being a currency, it changed into an accepted asset for investment 1/9

As an asset, the future of bitcoin seems assured if it doesn´t become excessively volatile. Last year, various financial institutions, preceding Tesla, started to invest a very small part of their portfolios in bitcoins. As I said, the allocators of wealth stepped-in. That..2/

That reinforced the fact that bitcoin could not be a general currency for regular transactions by regular people. To buy one bitcoin it costs now (it´s going down a bit this morning) ≈ 45900 dollars or ≈ 37900 euros, in the currencies that everyone uses. So,… 3/

To buy a 1/Nov/2020 car priced at 130000 USD (or ≈ €112000), one would pay 11 in bitcoins. Now, just ≈ 3 months late, the person has a car, but the 11 bitcoins would value USD 504.900 or ≈417270, i.e. more than 3 cars. A loser investor. Why use bitcoin for transactions? 4/

That example also shows why bitcoin cannot perform the crucial function of money as a stable unit of account. No firm could use such a unit of account (bitcoin) to base its pricing decisions or financial planning. Bitcoin is not a currency 5/

Bitcoin is now an asset, part of the investment world. In Wall Street, there is already a host of firms dealing in bitcoin derivatives. The Grayscale Bitcoin Trust, a Bitcoin holding company, holds 3.1% of the 18.6 million of bitcoins already mined (i.e.that exist).6/

There is now in Wall Street a whole ecosystem around bitcoin (Brokers, Funds, ETFs..). According to many, bitcoin is a kind of “digital gold” that tries to compete with gold in the same asset class, as I said. Strange as it seems, this is the possible future of bitcoin. 7/

Perhaps more non-financial firms will follow Tesla in having a small investment in bitcoins. Still, it is quite risky. Bitcoin is an asset that doesn´t generate a regular income, only capital gains (or losses). Its value depends only on buyers will and their expectations 8/

Some analysts believe that bitcoin “can only go up”. I quoted a market player speculating that it could go up to USD 400000 if all portfolios buy a little as part of the assets menu. Still, it could also collapse if it turns out to be too volatile, even for financiers..9/9