First, bitcoin was never a safe haven. Even before this recent crash it was just too volatile, too young and too untested for that role. In spite of the lack of logic, the narrative endured because so many wanted it to be true.
Now that we can put that legend to rest – an asset that can fall by over 40 percent intraday is unlikely to ever be taken seriously as a safe haven – more realistic expectations should emerge. This will support credibility amongst the investment community and perhaps give bitcoin a more justifiable role in portfolio management.
The greater the range of alternative assets, the better for investors, especially in troubling times like these. Analysts and fund managers will be looking for opportunities to offset the upcoming shift in market fundamentals – many are likely to take a closer look at bitcoin, which does not depend on macroeconomic metrics.
In a market where relationships are broken and assumptions are smashed, an alternative asset – vulnerable as it may be to money flows – does start to take on an appealing narrative of its own, more innovative and more credible than that of the safe haven.