Bitcoin (BTC-USD) prices have retreated from their all-time highs, but they are still higher year-to-date, thanks, in part, to enthusiasm for new spot bitcoin ETFs. As for the next catalyst for prices, it is likely coming in April when the cryptocurrency goes through a halving.
At the inaugural Bitcoin Investor Day, Anthony Pompliano, founder of Pomp Investments and host of the “The Pomp Podcast” spoke with Yahoo Finance’s Brad Smith about what lies ahead for the digital asset and how Wall Street’s view of bitcoin has evolved.
When asked how high bitcoin prices can go, Pompliano notes “We have violated a lot of the rules that people previously relied on in bitcoin.” One of those “rules” is bitcoin hitting new highs ahead of a halving. On that point, Pompliano calls it “uncharted territory,” noting that bulls will argue that it means prices will go even higher, while others may think “anything can happen.”
Watch the video above to hear what Pompliano has to say about the role bitcoin could play in elections around the world.
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Editor’s note: This article was written by Stephanie Mikulich.
Video Transcript
– We’re at the first inaugural Bitcoin Investor Day. I’ve got the founder of Pomp Investments, Anthony Pompliano, here with me. Thanks so much for taking some time this morning.
All right. So tell us about the setup for this and why bring the meeting of the minds together like this? You’ve got Novogratz. You’ve got Cathie Wood. You’ve got yourself, of course, leading the conversation. You’ve got Anthony Scaramucci.
What’s going on? What do these people all want to talk about right now?
– Yeah, so Bitcoin obviously is one of the best-performing assets. It’s a trillion-dollar asset now, and it’s infiltrated now into the traditional financial world. And so most of the conversation has been around Bitcoin, the Bitcoin investors, the holders, the crypto community.
But now that Wall Street is interested in this– Wall Street is used to a different type of event. They’re used to going to earnings days or going out to Omaha for Warren Buffett’s entire lovingly carnival. And so how do you bring people together to talk about an asset or an organization?
And so they do investor days, and that’s what we wanted to recreate here.
– Certainly. With that in mind, we’ve seen record highs this year. We’ve seen ETFs come forward at the end of last year. A lot of people are wondering, where does Bitcoin go from here? What is next, and what’s the next inflection point that you’re expecting?
– Yeah, so I think that one of the beauty of Bitcoin is that the narrative is so simple. For the average person, it’s, I can just save in an asset that isn’t debased and that tends to protect or increase my purchasing power.
Very simple for them to understand. They don’t have to be up to date every single day on what is the price or what is happening. The same thing now is that simplicity coming to Wall Street as well. And so Wall Street is saying to themselves, wait a second. We can just buy an asset that protects this quote, unquote, “purchasing power.”
But when you have individuals and institutions both doing that, that demand outstrips supply. And so from an investor seat, you’re like, wait a second. If there’s more demand than supply, the price is going to keep going up.
Now, is it going to go up in the short term, medium term, long term? How much? When? All these different things come into how much do you want to allocate. How do you put it into a portfolio? Are you trading or are you just buying and holding? But really, at the end of the day, it’s just, OK, if demand outstrips supply, the price is going to go up.
And I think that’s part of the beauty of this is the Bitcoin community is talking about number-go-up technology. And one of the secrets of Wall Street is Wall Street speculates more than the average retail investor. They have large pools of capital. They wear suits and ties. They got a good smile, but they still speculate just as much.
And so I think what we’re now are seeing is these investors saying to themselves, hey, we’re no different than the average retail person in terms of our psychology, human greed, human fear, and so how do we go ahead and actually express that in the market?
– In marine biology, they have what is called a mega pod. This is a mega pod that’s going to be here of whales out there, folks. And, of course, whales– some of the biggest holders of Bitcoin.
When you think about what their targets are for the end of the year, what is your target for the end of the year? How high do you think we could go for Bitcoin?
– Nobody knows, I think, is the short answer. And one of the reasons why I think people are so excited right now is we violated a lot of the rules that people previously relied on in Bitcoin. So we’d never gone below a previous all-time high. We did that, and we went down to $17,000, but we also had never hit an all-time high before the Bitcoin halving.
And so now, we’ve violated that rule. And so being at an all-time high going into a halving where the supply is going to get cut in half, I think people are like, oh, this could be different. This could be higher.
– Does that create a typical event though that we should be anticipating?
– So I think what it just means is like we’re in uncharted territory. Now, of course, people who hold Bitcoin are going to look at that optimistically and say, hey, that means the price is going to go even higher than we thought it was going to go. Another way to look at it, though, is just, if we’re in uncharted territory, anything could happen.
And so one of the scenarios that people don’t talk about is, maybe we just go sideways for a long time. And that’d be kind of boring. And so I don’t know what’s going to happen, but I do think that, again, the beauty and the simplicity of Bitcoin is that it is the full expression of your economics 101 class.
And in finance, I think a lot of people talk about being a free market kind of investor or theorist, et cetera, but most of the assets on Wall Street are not free market assets. There are circuit breakers. There’s hours of operations. There’s all these things that happen.
Bitcoin seems to be the most free market asset that we have, and so things like supply and demand, just the pure if there’s that more demand and you’re going to cut the supply in half, the price should go up much higher.
– Yeah. One last question for you before we let you go. I see that American flag pin that you got on you. And when we think about the year of elections that’s taking place, internationally, more than half of the world is expected to vote in some fashion or another take part in elections.
What does that mean for crypto? What needs to happen in order for it to be more accepted come November here in the US and even more so internationally?
– So I think some of the most recent surveys show somewhere between 15% to 20% of Americans have played with crypto, hold crypto, invested in crypto, et cetera. So obviously, that’s a pretty big portion of the constituent base.
But on top of that, now you also have politicians that realize, wait, this isn’t just like trying to appeal to the voters. I may actually need the technology.
And so we have seen many countries around the world say, wait a second, should we be valuating this for central bank reserves? Should we be looking at this for our national pension funds? Should we be looking for our sovereign wealth fund to get exposure?
And so it is now becoming a conversation, not only on the geopolitical level, not only on the economic level, but then, also, there’s social implications to it. And so in the United States, one of the most interesting things is there’s a wealth inequality gap.
That wealth inequality gap, if you really look at it, it is not about money, payments, spending, all the things people like to point to. It’s about education. 50% of Americans have investable assets, 50% don’t.
The people who don’t end up being on the wrong side of that wealth inequality gap. The people who do have investments end up being on the right side of it. And so if we could just teach people to invest or get out of a currency that’s being debased, then, naturally, they will benefit from inflation and debasement of the currency.
And so I think that’s what politicians are starting to wake up to is they’re saying, wait a second here. If I can actually help my constituents, and I can put them in a better financial position, I’m probably going to have a good job going for a couple of years here.
