The first city in the world to invest in cryptocurrencies?

Bitcoin price on Tuesday, February 9, it broke a record, breaking the barrier of 48 thousand. dollars. It happened right after the announcement that a business giant Tesla company buys bitcoins for 1,5 billion dollars. Soon, Miami, Florida may become the first city in the world to invest in cryptocurrencies, writes Daniel Kostecki, an analyst at the company Conotoxia Ltd, providing a Forex service for portal users Cinkciarz.pl.

The year 2021 continues to surprise in the financial markets, and the pace of events is very fast. The US dollar and US Treasury bonds seem to be losing out on underlying assets to hold on corporate or even local government balance sheets. The place is getting a new trend, which can be based on a contract, because it is not on utility value yet. It is about the possible investment in cryptocurrencies as a balance sheet diversification.

This is what Tesla did, announcing that it was following in the footsteps of companies such as MicroStrategy and Square, buying BTC for $ 1,5 billion. Tesla is to have approx. 20 billion free funds and has decided to allocate 7,5 percent. for the purchase of the most popular cryptocurrency.

Bitcoin is record-breaking

This caused euphoria in this market. This morning (Tuesday, February 9) the BTC / USD exchange rate rose to over 48. According to market observers, the decision of Tesla's management board may open the way for other companies, whose shareholders may soon ask: why not allocate a few percent. funds to buy BTC? The question seems justified at a time when inflation expectations in the US are soaring and the money supply is growing at a record pace. When it comes to tens or hundreds of billions of dollars, each percentage of the loss, due to negative real interest rates, represents significant amounts.

Soon, it may turn out that cryptocurrencies are in demand as reserve assets, not only for Wall Street investors, but also for local governments of American cities. The mayor of Miami, Florida, a supporter of the popularization of cryptocurrencies, is already looking to apply for it. Miami may soon be the first city in the world to allocate part of its budget to bitcoin. The decision may be made this week.