Bitcoin's Competitive Edge in Capital Markets

Bitcoin serves as a strong competitor for capital, particularly appealing for those focused on long-term value preservation. Its presence in the market influences the pricing of other assets, driving down costs for traditional investments like real estate, bonds, and collectibles. In a free market without capital controls, the dynamics shift: weaker currencies correlate with higher interest rates due to increased borrowing costs. As capital flows favor Bitcoin, traditional asset valuation metrics, such as price-to-earnings ratios and capitalization rates, are put under pressure, suggesting that both interest rates and asset prices in the fiat system are misaligned. With an adjustment expected, borrowing costs may rise, signaling that current rates are too low and thus unsustainable, which will subsequently correct the overvalued assets and highlight undervalued opportunities in the market.