Bitcoin Investment Insights

In a conversation at the Exchange conference in Las Vegas, which gathered about 2,000 investment advisors and asset managers, Dominic Rizzo, global technology portfolio manager at R. Rowe Price, stated that now is a favorable time to invest in bitcoin.

Bitcoin as a Commodity

Rizzo compared bitcoin’s price to a commodity, suggesting that investors should approach it similarly. He noted, “Bitcoin itself has traded very close to its average cost of mine. So if you think about it like a traditional commodity, that’s actually historically a really good time to have exposure to it when it’s close to its cost of mine.”

In traditional commodity investing, when the cost of mining or extracting a commodity is close to the spot price, it often indicates that the commodity’s price might have found its floor, suggesting limited downside risks. Rizzo hints at a similar dynamic for bitcoin if one draws parallels between commodity cycles and bitcoin pricing.

According to MacroMicro blog, the current average price of mining bitcoin is around $84,770, while the spot price is hovering near $87,000.

Embracing Blockchain and AI

Rizzo also highlighted the importance of blockchain and digital payments in fintech and artificial intelligence (AI). He remarked, “The world is getting more global, we’re moving from cash to digital payments … so, I think digital payments is really at the nexus of moving money cheaply and taking a software-driven approach to areas that have historically been not software-driven.”

He emphasized that blockchain is a critical part of this transition, asserting that every investor should have some exposure, whether through stocks of companies like Coinbase (COIN) or Robinhood (HOOD), or by investing in crypto miners benefiting from AI advances.