A Swiss investment bank and financial services firm, Union Bank of Switzerland said that the volatility and scale of Bitcoin are still too high to use the digital currency as money, CNBC reported.
In a note to customers, according to UBS analyst, Yoni Tevez, until legal support gets efficient enough and technical obstacles are surpassed, Bitcoin won’t be measured as a legitimate asset class.
“Bitcoin is still unstable and is limited to get transformed as an affordable payment or the main class of assets. Due to the lack of price stability, bitcoins do not meet the criteria that must be met to be considered as money.”
Bitcoin has witnessed escalating inclination from institutional sources of investment, as prices surged again in July and many anticipated big steps for adoption in the second half of the year.
The approval of the US-based Bitcoin exchange-traded fund is usually considered a possible cause of the seismic move in sentiment, while the global trade and technology company, Susquehanna, this week informed CNBC that the largest source of investment cooperating with Bitcoin would be a similar cause of the turning point moment.
UBS is traditionally very pessimistic about cryptocurrency. The company opted to not to offer cryptocurrency products or services to its client.
Analyzing the historical data on bitcoin prices, Tevez seems to have continued the vote of confidence and noted that bitcoin is not yet able to manage the volume of transactions processed by mechanisms used in the real world.
Earlier this week, UBS said in its report that bitcoin would have to trade at $213,000 to replace the US money supply. According to the industry figures, the price, which is about $223,000, was calculated to convert the money supply it into the new world of bitcoin.
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