Fidelity: ‘Countries That Secure Some Bitcoin Today Will Be Better Off Than Their Peers’

Even if a country doesn’t agree with the fundamentals of bitcoin, it will be forced to acquire some as a form of insurance, Fidelity wrote in a recent report.

AccessTimeIconJan 17, 2022 at 9:19 a.m. UTC
Updated Jan 18, 2022 at 3:29 p.m. UTC

While 2020 and 2021 are considered the years of bitcoin’s institutional adoption, Fidelity Digital Assets wrote in a new report that 2022 might be the era of adoption of bitcoin by sovereigns.

  • The report contrasted China’s crackdown on bitcoin throughout 2021 to El Salvador taking the “opposite approach” by adopting the digital asset as legal tender.
  • “We think the two developments observed this year couldn’t be more opposed. Time will certainly tell which path is more successful,” Fidelity wrote.
  • Even though many countries around the world are taking a strict approach to regulating crypto, Fidelity doesn’t believe that outright bans are on the table.
  • “An outright ban will be difficult to achieve at best and, if successful, will lead to a significant loss of wealth and opportunity,” reads the report.
  • Instead, as more countries adopt bitcoin, other countries will be forced to as well even if they don’t believe in the investment thesis or adoption of bitcoin.
  • “We also think there is very high stakes game theory at play here, whereby if bitcoin adoption increases, the countries that secure some bitcoin today will be better off competitively than their peers,” said the report. “In other words, a small cost can be paid today as a hedge compared to a potentially much larger cost year in the future.”
  • At an institutional level, a Fidelity Digital Assets Institutional Investor Survey found that 71% of U.S. and European institutional investors surveyed intend to allocate to digital assets in the future.
  • The price of bitcoin is down approximately 10% since the beginning of 2022, according to CoinGecko, and is currently trading at $42,853.

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
3 Things Blockchain Projects Can Do to Grow Merchant Acceptance
CoinDesk - Unknown
2
CoinDesk - Unknown
Exploring a Bitcoin Mining Container

A walkthrough of an industrial, portable BTC mining rig.

CoinDesk - Unknown
3
CoinDesk - Unknown
From BTD to FUD to WAGMI: Understanding Crypto Acronyms

If you follow crypto on Twitter, Discord or another platform, you may see people saying that they have “FOMO” or that the market is driven by “FUD.” Here’s what you need to know to decode the conversation.

CoinDesk - Unknown
4
CoinDesk - Unknown
CoinFLEX Says Roger Ver Owes It $47M USDC as Spat Turns Public

The crypto exchange is launching a recovery token because of debt owed by a high-net-worth customer.

CoinDesk - Unknown