baseline Vol. 001

November 20, 2020

The year 2020 is marked by the pandemic, and many of us have faced new challenges. After the initial shock, we are now in a phase of orientation. We try to understand whether and how our society will change as a result of the newly acquired insights.

Governments and central banks are implementing extraordinary measures to counteract the pandemic's economic consequences. Negative interest rates and expansionary monetary policies have become the norm. Both the US Fed and the European Central Bank have recently adjusted their views on inflation targets and are now aiming for an average of 2%, implying that further easing and interventions are on the way.

Nobody can predict with certainty how these interventions will affect our economy in the long term. As a result, topics such as portfolio diversification and capital preservation have increasingly moved into the spotlight for many investors and companies.

Traditional assets, such as equities and gold, have rallied sharply after a turbulent first quarter and in light of a falling dollar. But at the forefront, up over 100% since the start of the year, is Bitcoin.

The Bitcoin market has matured over the past few years, and investments in the double and triple-digit million range pose no problem, even for publicly listed companies. As recently as October, Square, Inc. (NYSE) invested USD 50 million from its total assets in Bitcoin; MicroStrategy (NASDAQ) had previously announced an investment of USD 425 million. And in 2021, PayPal, Inc. will start providing access to cryptoassets to its 346 million users.

Nevertheless, 11 years after the introduction of Bitcoin, many questions remain unanswered, and misconceptions persist. We have therefore put together a selection of content to make this new asset class more approachable. Additionally, the investor guidebook offers insights into how institutional and professional investors can gain access to cryptoassets.

Read the first edition online.

Available in German and English.

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