Bloomberg Crypto 03/19/2024

Summary

The Bloomberg Crypto segment discusses the recent price swings in the crypto market, with Bitcoin experiencing a significant drop. Anthony Pompliano of Pomp Investments shares insights on the market's volatility and the role of venture capital in the crypto industry. The upcoming Bitcoin halving and its potential impact on the market are also explored, along with the influence of crypto lobbyists in the U.S. elections and the possible introduction of regulatory bills affecting the crypto space.

Takeaways

• 📉 Bitcoin experienced a significant drop of over 12% in the past week, continuing its retreat from the previous week's record high.
• 💰 MicroStrategy's stock price fell 26% in two days after its executive chairman, Michael Saylor, sold $5 million in shares and the company made a substantial Bitcoin purchase.
• 🔄 Bitcoin's trading volatility was highlighted by a flash crash on BitMEX, where a sudden influx of sell orders caused a sharp price drop, differing from other exchanges.
• 📈 Despite recent declines, Bitcoin has seen a compound annual growth rate of 60% over the last ten years, outperforming the S&P 500.
• 🤝 The venture capital interest in the crypto space has increased, with more capital flowing into the industry compared to a year ago.
• 💼 Anthony Pompliano, founder of Pomp Investments, discussed the historical context of Bitcoin's price movements and the potential for future volatility.
• 🏛️ Crypto lobbyists are planning to spend tens of millions of dollars to influence U.S. elections, with a focus on supporting pro-crypto candidates.
• 🔄 The upcoming Bitcoin halving event is anticipated to impact Bitcoin's price, with historical trends suggesting an increase in value post-halving.
• 🚀 The growth of Ethereum and other blockchain technologies is being mirrored on the Bitcoin network, with developments like staking and cross-chain bridges opening up new use cases and potential for yield.
• 📊 The crypto market is currently seeing a mix of investor interest, with both institutional and retail investors participating in a market that includes both traditional assets like Bitcoin and more speculative 'meme coins'.

Q & A

What is the current trend for Bitcoin according to the transcript?

Bitcoin is experiencing a decline, being down about 5% at the time of the discussion and extending its retreat with a drop of about 13% from the previous week's record.

Who is joining the Bloomberg crypto discussion to talk about big price swings and venture capital in the crypto industry?

Anthony Pompliano is joining the discussion to discuss the big price swings and the latest in venture capital in the crypto industry.

What does the Bitcoin halving potentially mean for the crypto market?

The Bitcoin halving could lead to potential crypto consolidation, although the specific implications are not detailed in the transcript.

How is MicroStrategy's stock performance related to the company's Bitcoin purchases?

MicroStrategy's stock performance is negatively impacted, with the company's stock down 26% in two days following a 16% decline, despite the company making a second multimillion-dollar purchase of Bitcoin.

What is Grayscale Bitcoin Trust's current situation regarding outflows?

Grayscale Bitcoin Trust has faced outflows of about $12 billion since its conversion into a spot Bitcoin ETF in early January, with inflows moderating and outflows exacerbating since then.

What prediction does one analyst from Standard Chartered Bank have for Bitcoin's value by the end of the year?

One analyst from Standard Chartered Bank predicts that Bitcoin will hit $150,000 by the end of the year.

What unusual event occurred on BitMEX's crypto exchange?

BitMEX experienced a flash crash on its exchange due to unusual trading activity, including possible misconduct, which led to a significant drop in Bitcoin's price against Tether's USDC stablecoin.

How does the trading of Bitcoin differ across various exchanges compared to traditional equities?

In traditional equities, trades eventually feed back to a single data source. In contrast, the crypto market consists of different exchanges with various data feeds, and some exchanges like BitMEX do not employ internal market makers to maintain a stable price, leading to potential price volatility.

What is the historical context for Bitcoin's price drawdowns during bull markets?

Bitcoin has experienced 30% drawdowns five or more times during its bull markets, making the current 13 to 15% drawdown relatively small in comparison.

How does Anthony Pompliano view the recent interest in meme coins?

Anthony Pompliano views meme coins as a form of gambling that appeals to human nature, similar to lotteries and zero-day options. He acknowledges that people are making real money from them, but he likens it to playing video games for adults.

What is the role of crypto lobbyists in the upcoming U.S. elections?

Crypto lobbyists are planning to spend tens of millions of dollars to influence the U.S. elections, with the goal of swaying races in favor of pro-crypto candidates and increasing their influence in Congress.