The enthusiasm for bitcoin is becoming “more and more sectarian” and is based on “magical thinking,” Will Hobbs, investment director at Barclays Wealth & Investments, told Business Insider.
The first cryptocurrency could turn out to be a wingless bird if interest rates rise, he added.
Hobbs stressed that his company is not interested in investing in bitcoin, despite the record rally. He named volatility as the main reason:
“It is several times more volatile than our riskiest asset class, which is emerging market equities.”
The investment director noted two main criteria that an asset must have in order to get into the Barclays Wealth & Investments toolkit:
have a positive expected return;
be attractive for diversification.
“Perhaps over time, bitcoin will satisfy both. But at the moment it is difficult to talk about it. We wait on the sidelines and watch others, ”concluded Hobbs.
He expressed concern about Bitcoin’s enthusiasm:
“It looks like a religion – more and more sectarian.”