Cathy Wood, CEO of ARK Invest, believes that digital wallets and blockchain technology are among the “game-changing innovations” that stock markets have largely ignored in 2022.
On a Jan. 12 blog post on ARK Invest, Wood suggested that the stock market faces a “wall of anxiety” in 2022, due to fears of entrenched inflation, higher interest rates, and has largely ignored some innovative technologies.
Wood highlighted that digital wallets are “replacing cash and credit cards,” noting that they have overtaken cash as the best transaction method for offline commerce in 2020.
Furthermore, Wood noted that digital wallets should not be overlooked, noting that they also account for nearly 50% of global online commerce in 2021.
Wood suggested that the recent crash of cryptocurrency exchange FTX has not affected the larger mission that public blockchains aim to achieve. I noticed:
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“Public blockchains like Bitcoin and Ethereum have not skipped a beat in transaction processing.”
Wood highlighted how the FTX collapse has educated cryptocurrency investors to be more careful about where their crypto assets are stored, saying that the share of volume on decentralized exchanges, which allow trading without a central broker, rose 37%, jumping from 8.35% to 11.4%.
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Never, in her “30 years of portfolio management,” Wood said, have she witnessed such unstable market conditions, saying she has never seen “markets this turbulent.”
The CEO noted that the economy is facing a difficult situation, with a decline in the money supply, lower commodity prices and “unbundling” of bloated inventories, indicating slowing inflation and possibly deflation.
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Wood noted in the report that fear is high among investors who say investors are holding “high levels” of liquidity not seen since the September 11 crisis of 2001.
Other “game-changing” innovations that Wood believes the stock market has been “largely ignored” in 2022 include artificial intelligence, electric vehicles, space exploration and 3D printing.
She believes that despite market uncertainty, disruptive innovation technologies that “solve problems” have historically gained share during turbulent times.