- The Financial Times, which has dismissed Bitcoin since first coming across it in 2011, may be on the verge of a Scrooge-like change of heart
- The Financial Times has finally admitted that Bitcoin might not be the Ponzi tulip scam it has been portraying it as for nine years
- Institutional adoption seems to have melted their cold hearts, just in time for Christmas
It is quite fitting that at a time when Charles Dickens’ A Christmas Carol is getting its annual airing, the Financial Times should appear to have experienced something of a melting of its ice-cold heart with regard to Bitcoin. It’s too early to say that the curmudgeonly 132-year-old newspaper’s correspondents have gone full Scrooge, but it seems that their icy hearts might at least be thawing to the cryptocurrency – and all it took was billions of dollars of institutional money.
Bitcoin? Bah, Humbug.
Our story begins in June 2011 when the Financial Times, whose target market is as rooted in traditional finance as trees are in the ground, first came across the three-year-old fintech upstart. Naturally it didn’t know what to make of it and, rather than trying to understand it, dismissed it out of hand, along with its attempts to reimagine money. To be fair, they were far from alone.
Believing that Bitcoin was a flash in the pan that would die out quicker than Tiny Tim’s chances of winning an Olympic 100m gold medal, the Financial Times sat back and mocked as Bitcoin experienced the well documented booms and busts, calling it variously a massive Ponzi scheme, a pyramid scheme, and, as if it was expecting a prize for incorrect comparisons, “the tulip of the 2st century”.
The Ghosts of Institutional Investment Pay a Visit
While other outlets acknowledged that Bitcoin’s staying power and recurrent market cycles had rendered comparisons with tulipmania and the like redundant, the Financial Times stuck to its outdated opinions, primarily to avoid angering their target market of fellow Bitcoin Scrooges. Even JPMorgan, Paul Tudor Jones, George Ball, and Stan Druckenmiller couldn’t change their minds.
What seems to have finally penetrated the reinforced concrete vault that is the Financial Times’ soul is the buying up of Bitcoin by the very companies that adorn the pages of their venerable newspaper. It seems that throughout Q4 this year, FTHQ has been visited by not just three but several ghosts – Stone Ridge, MicroStrategy, MassMutual, Ruffer Investment and potentially more, all of whom rattled their chains and publicly backed Bitcoin to the tune of billions of dollars.
It seems that these visitations might just have had the desired effect and led the Financial Times to realize that, actually, they might have been labouring under a misunderstanding all these years. The potential crack in the concrete came via a piece written Friday entitled “2020: The year bitcoin went institutional”, which suggested that the tide might be on the turn:
Whether critics like it or not, bitcoin’s status as an asset class is now much harder to dispute.
Hardly a Damascene conversion, but we weren’t expecting the Financial Times writers to be rushing round to the nearest cryptocurrency shop in order to buy up the prize Bitcoin hanging in the window and have it sent to their interns to enjoy on Christmas day. No, instead the tone was one of grudging acceptance, like Scrooge finally accepting that Christmas does actually exist after ignoring it for almost a decade:
Bitcoin’s value has instead become linked to something more profound: its incapacity to go to zero despite having no central point of support or guarantor.
The Financial Times piece actually acknowledges the “large scale institutional investment” Bitcoin has witnessed this year and doesn’t try to put it down to an accident or a scam or anything. No, it’s almost like these companies know what they’re doing. Imagine!
If It’s Not Dead, it Might Just be Alive
The same piece then makes a grand assumption and suggests that all these billions of dollars flowing into Bitcoin might actually mean something:
If you consider institutional flows into bitcoin as a form of ideologically-motivated divestment from fiat you can see they’re worth paying attention to.
Nice of the Financial Times to leave it up to their already skeptical readers to decide when they could have gone straight to the horses’ mouths:
MicroStrategy: “MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash.”
Ruffer: “Bitcoin…acts as a hedge to some of the monetary and market risks that we see.”
In much the same way that Christmas keeps coming round every year, the Financial Times seems to have realized that something that hasn’t died by the age of twelve might actually be alive:
…it is no longer possible to deny its (Bitcoin’s) overall resilience. And since resilience was always part of bitcoin’s raison d’être that’s an important win for the would-be challenger system. All the more so if you consider that institutional money feels it can no longer afford to ignore it.
The Perfect Present
So there you have it. After twelve years of denials, mockery, and declarations of death from the Financial Times, it seems that the spirits have finally done their work and warmed old Scrooge’s heart to the possibility that maybe, maybe, there might just be something to this Bitcoin thing after all. We asked in October if the Financial Times would ever admit defeat over its perception of Bitcoin, and this year might finally be the year it comes to pass.
Just as Scrooge would have undoubtedly been welcomed into Bob Cratchett’s house without a second thought on Christmas day, even after years of browbeating, the Bitcoin community welcomes the Financial Times to our humble abode and says, warmly and with all the tenderness in our hearts, “To the moon, everyone”.