Cathie Wood: Bitcoin is an excellent hedge against inflation, reiterates target price of $1 million

On Thursday, Ark Investments CEO Cathie Wood reiterated her $1 million price target for Bitcoin at the Bitcoin 2022 conference in Miami, calling the cryptocurrency "a great hedge against inflation."

Bitcoin fell slightly to $43,300 in early trading today, up nearly 3% from the same period last month, but the price of the currency has fallen 9% so far this year and 25% from the same period last year. As of press time, the currency is trading at $42,894 per coin.

"If the inflation problem gets worse, Bitcoin will be a good hedge against inflation," Wood said. It is understood that at present, the US economy is affected by continued supply chain disruptions and geopolitical tensions, and inflation is soaring to its highest level in 40 years. Although the price of Bitcoin is highly volatile, Wood pointed out that research shows that 70% of Bitcoin investors hold Bitcoin positions for more than 6 months, and its liquidity has jumped 10 times.

Wood stressed that although the number of investors accepting Bitcoin has increased, it still has a long way to go before it is fully accepted. Moreover, the price of Bitcoin is not stable, which is a terrible thing for investors. As a new asset class, the risk of participating in it will become very large.

In addition, the change in wording in U.S. Treasury Secretary Janet Yellen's important speech on digital assets on Thursday showed that she "has changed her attitude." Wood believes that "this is a positive factor for the currency." It is understood that a year ago, Yellen's comments on Bitcoin were mainly biased towards adverse effects such as money laundering and environmental damage. Michael Saylor, CEO of MicroStrategy (MSTR.US), who spoke with Wood, also emphasized that he is more optimistic about Bitcoin than ever before.