Pompliano Reminds Global Investors: Bitcoin Is The Best Performing Asset Class In Past 10 Years
Despite the current bear market and all the problems that it is bringing to the industry as it devours the gains of the investors this year, Anthony Pompliano, the partner of Morgan Creek Digital Assets, has defended the idea that Bitcoin (BTC) is, in fact, the best performing asset class in the decade.
According to him, Bitcoin will be very likely to fall to 85% of its all-time high when it reaches around $3,000 USD, but it will stop there. He says that the selling pressure happened to drive the prices down because Bitcoin was overpriced after the rally last year.
While Bitcoin was, he believes, overvalued, Pompliano defended that it has outperformed S&P, Dow Jones, NASDAQ and others during its longest bull run. Also, the asset had two drops of 85% and it is still over 400% when compared to the last two years.
The Big Players Get In
He has also added that Bitcoin’s price action in the past years has been driven mostly by retail investors and that we can see their impact as soon as they invest. Their movements are clear and their strategies are generally more simple than the ones from the institutional market.
Now, however, we got Fidelity and the owner of the New York Stock Exchange (NYSE), the Intercontinental Exchange (ICE), with its Bitcoin platform Bakkt. These will completely change the rules of the game in the future.
Bitcoin was considered to be a highly volatile asset during its life. The volatility was only down for some time in 2018 as the prices slowly dropped. However, now, most institutional clients are currently trading using the considerably less transparent over the counter (OTC) trades, which have effects that are not apparent immediately all the time.
Pompliano was also asked about miners during the interview. He affirmed that as the values of crypto go down, so do the mining operations. Only in regions with very cheap power it is still a good idea to mine Bitcoin, he said. This is mostly because the prices are so low that it is hard to generate profits.
In most of the world, it costs at least $6,000 USD to mine Bitcoin. With the price now being only a little bit more than half of that, you would be mining and actually losing money. However, the miners of some regions spend as little as $2,000 USD to mine 1 Bitcoin (BTC) sometimes, so they may achieve better results in the end.
The Future Of The Market
Pompliano seems to believe in a bright future for Bitcoin, as most of the people in the industry do. The token will have more support of institutional investors in 2019 and this will increase its chances of having a new rally or, at least, to go up again a bit.
Vinny Lingham, a CEO of Civic, a blockchain startup, has predicted that the $3,000 to $5,000 USD price range will last six months, so it looks like we still have a lot of time to wait.
Bitcoin is currently trading at about $3,700 at the time of this report. It was in the low $3,000 some days ago, but now it has regained some of its price.