Bitcoin (BTC) continues to be one of the most discussed topics in the financial world. Its proponents claim that it is a tool for financial freedom, a hedge against inflation, and a hedge against systemic risks. However, despite BTC’s popularity, many experts, including WSPNPayment CEO Austin Campbell, have expressed doubts about the advisability of using Bitcoin as a strategic reserve for states or companies. In his detailed analysis, Campbell explains why Bitcoin as an asset has its advantages, but should not become an element of state and corporate financial strategy.

Bitcoin #btc as an asset: advantages and limitations

Campbell acknowledges that Bitcoin has unique properties that make it attractive to private investors:

  1. Hedge against systemic risks.
    Bitcoin allows you to store assets outside the traditional financial system, which is especially important in countries with unstable economies.

  2. Decentralization and censorship resistance.
    BTC remains one of the most secure digital currencies from external control, making it a safe tool for long-term storage of value.

  3. A tool for saving money.
    For private investors, BTC can serve as a kind of "digital gold" that protects against inflation.

However, despite these advantages, Campbell argues that Bitcoin is absolutely not suitable for use as a strategic reserve of the state or on corporate balance sheets.

Why Governments Shouldn't Invest in Bitcoin

1. Weakening control over monetary policy.
Campbell emphasizes that adopting Bitcoin as a strategic asset would undermine the state's ability to manage its economy. If the US, for example, decided to include BTC in its reserves, it would signal the country's inability to manage the dollar, which would lead to a decline in confidence in the national currency.

2. Risks of confiscation.
If the government recognizes Bitcoin as a strategic asset, there is a risk that it will be confiscated from citizens in a crisis situation, which will only exacerbate mistrust of the authorities.

3. Inefficiency of BTC as a government asset.
Bitcoin, Campbell says, "just sits there." It doesn't generate income, it doesn't build infrastructure, and it doesn't solve society's problems. Governments should be investing in education, health care, road repairs, not "magic money."

4. BTC instability in crisis situations.
During a crisis, Bitcoin could be dumped on the market to finance government needs, causing its price to plummet at the very moment it is needed most.

5. Long-term economic consequences.
Investments in BTC divert resources from the real sector of the economy. As a result, money that could be spent on infrastructure development or scientific research is locked in a passive asset.

Why Corporations Shouldn't Use Bitcoin as a Reserve

1. Mixing roles.
Campbell points out that including BTC on corporate balance sheets turns companies into hybrids of operating businesses and crypto funds, making them harder to value and less efficient.

He cites MicroStrategy as an example, whose approach to buying Bitcoin has attracted the attention of the market, but is not a universal model for other companies.

2. Risks to the economy.
If corporations start buying Bitcoin en masse, it will lead to a misallocation of resources. In the short term, the price of BTC will skyrocket, but in the long term, jobs will suffer, economic activity will decline, and this could bring down not only the economy, but Bitcoin itself.

3. Conflict of interest.
Campbell believes that companies should focus on creating products and services rather than speculating on cryptocurrency, otherwise it could undermine investor confidence.

Other experts' opinions

Nassim Taleb, author of The Black Swan, is also skeptical about Bitcoin. He believes that BTC is more suitable for speculation than for long-term storage of value:
"Bitcoin is not an inflation hedge. It is volatile and more like a Ponzi scheme."

Michael Saylor, founder of MicroStrategy, on the contrary, believes that BTC is digital gold:
"Bitcoin is the only asset that does not lose its value in the long term. It is the most reliable form of money."

Analytics: What do the numbers say?

  1. MicroStrategy example.
    The company spent more than $4 billion buying Bitcoin. While this increased its market cap, it left its business dependent on the cryptocurrency’s volatility. It’s a risky strategy that isn’t suitable for most companies.

  2. State reserves.
    As of 2024, no major economy uses Bitcoin in its reserves. Even El Salvador, which made BTC legal tender, has struggled with its volatility.

  3. Attracting private investors.
    According to a study by Fidelity, more than 50% of institutional investors are already considering Bitcoin as part of their portfolio. However, this does not mean that they are ready to make it their main asset.

What does it take for BTC to be adopted en masse?

1. Price stabilization.
High volatility scares away investors and makes Bitcoin unsuitable for use as a reserve asset.

2. Development of infrastructure.
To use BTC in the economy, convenient payment systems are needed that are accessible even to people who are far from technology.

3. Regulation.
Clear laws and investor protection will increase confidence in Bitcoin.

Bitcoin remains a powerful financial instrument, but it should not become part of government or corporate strategy. Governments and companies should focus on developing the real sector of the economy, not on speculation.

Campbell emphasizes:
"Invest in BTC yourself, but don't force the government or corporations to do it for you."

The future of Bitcoin depends on whether it can transform from a speculative asset into a fully-fledged financial instrument. This will take time, technology, and the right strategy.