Bitcoin Valuation Approach

This question practices how to evaluate an asset when traditional valuation methods like discounted cash flow do not work. Candidates need to think through the difference between productive assets, which can be valued from expected cash generation, and non-productive assets, whose value depends more on market demand, scarcity, acceptance, and investor perception. In investment banking interviews, this kind of question tests judgment, commercial awareness, and the ability to explain why some assets are priced by supply, demand, and portfolio role rather than by earnings or cash flows.

It also helps interviewers see whether a candidate can discuss Bitcoin in a balanced way, including the debate over whether it should be viewed as a currency, a speculative asset, or a hedge within a portfolio. This is relevant in FIG because it connects to broader questions about money, stores of value, financial system trust, and the role of alternative assets in asset allocation.