Over the past ten years, the USD became a key component of the reserve system of states all around the world. At the beginning of March, it has been noted that more than 59% of worldwide government reserves are held in US dollars.
Until recently, US government bonds and USD had a reputation for being risk-free assets. But the freezing of Russian dollar reserves showed that, under exceptional circumstances, the country could lose its savings.
This opinion was expressed by Galaxy Digital CEO Mike Novogratz during the interview with SNBC. The businessman believes that after the end of all geopolitical battles, the authorities will begin to follow the classic investment rule of portfolio diversification.
In this way, the state will protect its reserves from permanent freezing of large amounts. Novogratz believes that the diversified reserve fund will also include cryptocurrencies like Bitcoin in addition to USD and gold. Because of Bitcoin’s capabilities of risk hedging functions and high income. With other financial instruments, like gold and USD, the main drawback of Bitcoin – volatility