At the Bitcoin 2022 conference, Michael Saylor, CEO of MicroStategy and Cathie Wood CEO at Ark Invest argued that Bitcoin has never seen a more positive environment.
Saylor and Wood look at the current landscape through lenses that focus on regulatory issues and the macroeconomic environment. They also see a future where the capital markets will accept bitcoin regardless of what happens. Wood reiterated a prediction by her firm, that each bitcoin would be worth $1,000,000 by 2030.
The talk focused on the positive attitudes of previous bitcoin skeptics to the asset. Wood spoke out about what she considered a significant change for Treasury Secretary Janet Yellen. Her public speeches and commentary have repeatedly warned of the negative consequences of bitcoin and digital assets on financial markets and consumer welfare.
In a recent interview with CNBC, she stated that crypto has grown rapidly and now plays a significant part in not only transactions, but also in investment decisions for many Americans…There are some benefits to crypto and we recognize that innovation in the payment system may be a good thing.
Saylor stated that he saw President Biden’s recent executive order, which required government agencies to examine digital assets and evaluate their potential, as the green light for Bitcoin. He said that he does not know if the President of the United States has ever directed the government’s acceptance of a new asset type.
Saylor then turned to capital markets and recalled an incident where analysts at Merrill Lynch mocked him when he said that he wanted bitcoin to be bought with MicroStrategy funds. “They laughed at me, and said that they would not sell it to them, but that we wouldn’t be allowed to discuss it, or else we get fired.” He told the audience that he wired $175million out of the bank quickly. The ultimate vindication was that his inbox contained bitcoin research from Merrill Lynch that was sent to him by the same broker. As if we are covering it now. This is how we think. Every bulge bracket farm has started to cover it.
Both Wood and Saylor see bitcoin as an important hedge and store-of-value in today’s macroeconomic environment. This is amidst rising inflation and uncertainty due to the growing impact of sanctions against Russia and ongoing coronavirus outbreaks around the globe. Saylor noted that, even though the issues are unfavorable for the world, they all highlight the need for a global, non-sovereign store value like bitcoin.
Both see bitcoin as a long-term success, but the asset is vulnerable to macroeconomic headwinds in the short-term. Wood believes it is a fallacy for investors to place bitcoin in tech stocks (which are currently struggling) hoping that the correlation will decrease over time as the asset becomes more accepted.
Bitcoin’s recent struggles include a drop of 5% from $47,000 to $43,375 at 12:08 ET.