Bitcoin is the ‘least risky asset’ long-term, says top analyst

Bitcoin is often labeled a risk asset, but Kelly Kellam, Director at Bitlab Academy, argues that when viewed with a long-term perspective, Bitcoin is actually the least risky asset.

Speaking with Roundtable host Rob Nelson and Alex Chizhik, Chief Commercial Officer at HarrisX, Kellam explained that investors get caught up in short-term volatility, losing sight of Bitcoin’s true value as a long-term store of wealth.

“The problem is we’re all greedy, and we want to look at and get so captured in the 15-minute, the one-hour, even the four-hour time chart and go, but it trades so ly. Well, I mean, that’s a different approach — trader versus investor,” Kellam said.

He noted that while Bitcoin trades like a risk asset in the short term, it behaves more like a wealth-preserving investment over longer time horizons.

Why most people struggle With Bitcoin’s volatility — Chizhik

Chizhik agreed with Kellam’s perspective, noting that most people live day to day and aren’t equipped to handle Bitcoin’s price swings.

“It’s tough to manage liquidity, and most people have no idea how to manage liquidity. So when you’re paying the bills and you’re going out and buying eggs, it’s all nice and good in the U.S., right? Even. But if you go outside the U.S. or even within the U.S. with middle class and below, folks that are getting hurt by inflation, they don’t fully have the education to understand that, hey, long-term savings should be in an asset that has escape velocity away from monetary debasement, and that’s NASDAQ and primarily Bitcoin,” Chizhik said.

However, for those living paycheck to paycheck, Bitcoin’s volatility can be a serious issue.

“When you’re living day to day and you have to manage liquidity, the volatility can kill people. If, like Kelly said, they’re leveraged or they don’t fully understand how to manage these month-to-month moves.”

Borrowing against Bitcoin could change everything

Chizhik pointed out that one of the biggest game changers for Bitcoin adoption is the ability to borrow against BTC holdings instead of selling.

“Kelly had a very, very, very smart, and I think overlooked point… borrowing against your Bitcoin or digital assets reduces the sell pressure,” he said.

He explained how this fundamentally changes how people interact with Bitcoin.

“To say that, hey, when I need some liquidity, when I need to buy eggs, I don’t need to go and sell that coin. I can leave it in a bank. That, by the way, solved my custody issue because my house, God forbid, got burned down and so did my keys, but I trust BNY Mellon to custody it and I can borrow against it and I can take a couple thousand dollars out, make it through that next month, wait until the Bitcoin goes through its volatility, and then I’m back in the green again. That is a fundamental shift.”