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According to Horizon Kinetics, a contrarian investment firm, cryptocurrency and land are the best assets to protect against currency depreciation.
Horizon Kinetics, a contrarian investment firm, advises investors to seek exposure to crypto assets in the face of mounting global economic challenges.
Speaking to the Financial Times, Horizon’s co-founder Peter Doyle warned that the coronavirus pandemic and growing debt will usher an inflection point for the world economy, predicting:
“There is no turning back after the pandemic and globally there is a debt problem and it means either default or currency debasement.”
Horizon’s Paradigm fund made a 1% allocation into Grayscale’s Bitcoin Trust in 2016, with the investment now representing 10% of the fund’s portfolio.
“People should have exposure to the asset class,” asserted Doyle, emphasizing Bitcoin’s capped supply amid concerns regarding currency debasement.
“The best long-term investors tend to have concentrated portfolios and low turnover in holdings as they let the companies they own grow and compound returns,” he added.
Horizon Kinetics currently boasts three of the top-10 performing mutual funds of 2021 so far, according to Morningstar.
Aside from its crypto allocation, the firm’s top-performing funds have benefited from long-term investments in landowners and real estate developers across North America, such as Texas Pacific Land, Dream Unlimited, and Brookfield Asset Management.
Guardtime, a European blockchain firm, published findings earlier this month that the coronavirus pandemic has prompted governments to accelerate their research into central bank digital currencies (CBDC).
The firm’s research found that “Not only has Coronavirus accelerated the digitisation of society, but it has also further transformed how we use money,” predicting that a CBDC could be launched within three years.