VanEck: 4 Reasons Why Bitcoin Improves Investment Portfolio Upside

Major United States investment management firm VanEck has listed four reasons why Bitcoin improves an investment portfolio upside.

On Oct. 8, VanEck released research titled "The Investment Case for Bitcoin," aiming to determine what role the cryptocurrency can play in an investment portfolio.

Monetary value instead of intrinsic valueAs VanEck often refers to bitcoin as "Digital gold," the asset manager argues that Bitcoin is a potential store of value.

While Bitcoin critics usually point out a major narrative that Bitcoin has no intrinsic value as a primary argument for its failure, VanEck urged to draw a clear distinction between the terms intrinsic value and monetary value.

According to the firm, Bitcoin actually has MV just like gold or silver, artwork or U.S. dollars.

Low correlation to traditional assetsAccording to VanEck, Bitcoin may also potentially increase portfolio diversification due to low correlation to traditional asset classes such as gold, bonds and broad market equity indices.

Bitcoin halvings, defined as a 50% block reward cut to Bitcoin production rate, are programmed to occur roughly every four years, VanEck explained, noting that each halving event has eventually led to growth of Bitcoin's price.

Famous Bitcoin bull and programmer John McAfee recently cited Bitcoin's scarcity as a primary reason for Bitcoin to hit $1 million per coin in 2020.

As part of the growing adoption of Bitcoin VanEck cited the fact that Bitcoin transactions exceed 400,000 permissionless transactions a day, while Bitcoin on-chain transactions amount to a notable portion of SWIFT transactions.

In mid-September, the Chicago Board Options Exchange's BZX Equity Exchange withdrew its VanEck/SolidX Bitcoin ETF proposal from consideration before the U.S. Securities and Exchange Commission.