Every SMALL Bitcoin Investor MUST Pay Attention to THIS! Cathie Wood

Summary

The transcript discusses the recent success of Bitcoin's ETF, highlighting its rise to become the third most significant asset class. It emphasizes the potential for institutional investment once major wirehouses like Morgan Stanley and UBS approve Bitcoin on their platforms. The speaker also touches on the global monetary system implications of Bitcoin, describing it as a decentralized, rules-based system without government oversight. Furthermore, the conversation explores the convergence of Bitcoin and AI, particularly in Africa, and the impact on the economy. The speaker predicts a continued rise in Bitcoin's value due to its scarcity and institutional interest, comparing the current situation to an 'electricity bubble' rather than a bubble destined to burst.

Takeaways

• 🎉 Bitcoin has achieved a significant milestone with its ETF, making it the third most popular cryptocurrency.
• 🚀 The speaker believes that Bitcoin's success is akin to David defeating Goliath, indicating a significant underdog victory.
• 🏦 Major financial institutions like Morgan Stanley, UBS, and Wells Fargo have not yet approved Bitcoin on their platforms, suggesting a potential explosion of institutional investment when they do.
• 🌐 Bitcoin is described as a new asset class and a global monetary system without government oversight, emphasizing its decentralized and rules-based nature.
• 🤖 A monthly Bitcoin brainstorm session highlighted the convergence of Bitcoin and AI, particularly in Africa, where it's redefining the division of labor and the gig economy.
• 📈 The speaker forecasts a bullish case for Bitcoin, predicting it could reach $1.5 million in 5 years, based on institutional investment and Bitcoin's scarcity.
• 💰 Institutional investors are increasingly considering Bitcoin due to its low correlation with other assets, providing diversification benefits.
• 📊 The scarcity of Bitcoin, with a maximum of 21 million coins, is driving its value higher as institutional dollars push into the market.
• 📈 Despite a recent price increase, long-term Bitcoin holders are holding onto their assets, anticipating further institutional investment.
• 🔄 The speaker expresses excitement about the Ethereum network, Solana, and other blockchain technologies, noting the healthy competition among them.
• 💡 The importance of domain expertise, AI capabilities, and proprietary data is highlighted as key factors in determining the success of companies in the AI space.

Q & A

What significant achievement is being discussed in the context of Bitcoin?

The significant achievement being discussed is the approval of a Bitcoin ETF, which has led to Bitcoin becoming the third-largest asset in its category.

Why is the approval of Bitcoin on platforms like Morgan Stanley, UBS, and Wells Fargo considered important?

The approval of Bitcoin on these platforms is crucial because these wirehouses dominate the speaker's customer base, and their approval could lead to a significant increase in institutional investment in Bitcoin.

What does the speaker imply about the future of Bitcoin in terms of institutional adoption?

The speaker implies that once major financial institutions approve Bitcoin on their platforms, there will be a substantial increase in institutional investment, potentially leading to an 'explosion' in Bitcoin's value.

How does the speaker describe Bitcoin in terms of its role in the financial ecosystem?

The speaker describes Bitcoin as a new asset class and the first global, private, digital, decentralized, and rules-based monetary system in history.

What is the 'Bitcoin brainstorm' event mentioned in the script, and what was one of its key discussions?

The 'Bitcoin brainstorm' is a monthly event where discussions around Bitcoin take place. One of its key discussions was the convergence between Bitcoin and AI and how it is already redefining the division of labor in Africa.

What is the current forecast for Bitcoin's value in the next five years according to the speaker?

The current forecast is that Bitcoin's value could reach $1.5 million within the next five years, which would have been by 2027.

How does the scarcity of Bitcoin contribute to its value?

The scarcity of Bitcoin, with a maximum of 21 million coins that will ever exist, contributes to its value by making it a rare and limited asset.

What unusual behavior of long-term Bitcoin holders is mentioned in the script?

The unusual behavior mentioned is that long-term holders, typically a metric monitored through on-chain analytics, are not selling their Bitcoin even as the price increases, possibly due to anticipation of further institutional investment.

What role does competition among different blockchain networks play according to the speaker?

Competition among different blockchain networks like Ethereum and Solana is seen as beneficial as it keeps the networks honest and drives innovation.

How does the speaker view the current state of Bitcoin in terms of being a bubble?

The speaker does not believe that Bitcoin is in a bubble. Instead, they compare it to the invention of electricity, suggesting it is a transformative technology rather than a temporary trend.

What factors does the speaker identify as key to determining winners and losers in the AI and blockchain space?

The speaker identifies deep domain expertise, AI expertise, good distribution strategies, and harnessing proprietary data as key factors in determining success in the AI and blockchain space.

Outlines

00:00

🚀 Bitcoin ETF Success and Institutional Adoption

The speaker celebrates Bitcoin's ETF launch, positioning it as a significant win akin to David versus Goliath. They highlight that despite the ETF success, major financial institutions like Morgan Stanley, UBS, and Wells Fargo have yet to approve Bitcoin on their platforms. The anticipation is that once these institutions begin to adopt Bitcoin, there will be a significant surge in institutional and governmental interest. The speaker emphasizes that Bitcoin is not just a technology but represents a new asset class and a global monetary system without government oversight. They mention a monthly 'Bitcoin brainstorm' event that explored Bitcoin's convergence with AI, particularly in Africa, where it's redefining the division of labor and the gig economy. The scarcity of Bitcoin, with a maximum of 21 million coins, is underscored as a value driver. The speaker also discusses the unusual behavior of long-term Bitcoin holders not selling despite recent price increases, suggesting confidence in Bitcoin's future value. Metrics and predictions about Bitcoin's potential value are also touched upon, with a previous forecast of $1.5 million per Bitcoin by 2027 still considered plausible.

05:02

🔗 The Impact of Cryptocurrency and AI on Economy and Investment

The second paragraph delves into the excitement surrounding the Ethereum network, Solana, and the roles they play in the cryptocurrency space. The speaker appreciates the competition among these networks as it keeps them honest. They discuss the inefficiencies in current payment systems, highlighting that using intermediaries like credit cards can impose a 2-4% tax on every purchase. The potential for cryptocurrencies to reduce this 'tax' and increase access to purchasing power globally is emphasized. The speaker refutes the notion that the current interest in cryptocurrencies represents a bubble, instead characterizing it as a response to 'electricity'. They also mention a shift in investment focus away from well-understood stories like Nvidia towards companies in their portfolio that are undervalued and poised to benefit significantly from AI advancements, particularly those with deep domain expertise in areas like multiomics. The importance of proprietary data in determining the success of these companies is stressed. The paragraph concludes with an invitation to join a growing community for timely crypto analyses and strategies, encouraging viewers to subscribe for updates.

Keywords

💡ETF

ETF stands for Exchange Traded Fund, which is a type of investment fund and exchange-traded product, traded on stock exchanges much like individual stocks. In the context of the video, Bitcoin's ETF is mentioned as a significant milestone, indicating that Bitcoin is becoming more mainstream and accessible to investors, as it allows them to invest in Bitcoin without having to buy and store the cryptocurrency directly.

💡Wirehouses

Wirehouses refer to large brokerage firms that offer a wide range of financial services, including investment banking, asset management, and brokerage services. In the script, it is mentioned that wirehouses like Morgan Stanley and UBS have not yet approved Bitcoin on their platforms, which suggests that there is a significant untapped potential for Bitcoin's adoption by institutional investors once these firms start offering Bitcoin-related products.

💡Asset Class

An asset class is a group of similar assets that are believed to behave in a similar way under various market conditions. In the video, Bitcoin is referred to as a new asset class, emphasizing its unique characteristics and potential as an investment separate from traditional assets like stocks and bonds. The speaker suggests that Bitcoin's low correlation with other assets makes it an attractive option for diversification.

💡Global Monetary System

A global monetary system refers to the framework that governs the exchange of currencies and the functioning of the global economy. The script discusses Bitcoin as a part of a new, global, private, digital, and decentralized monetary system without government oversight. This highlights the revolutionary potential of Bitcoin to redefine how money is created, stored, and transferred across borders.

💡Decentralized

Decentralized refers to the distribution of functions and powers away from a central authority. In the context of the video, Bitcoin's decentralized nature is emphasized as a key feature, meaning that no single entity controls it, which is a contrast to traditional financial systems that are centralized and regulated by governments and banks.

💡Lightning Network

The Lightning Network is a second-layer payment protocol that operates on top of a blockchain network, in this case, Bitcoin's. It enables fast and low-cost transactions, which is crucial for scaling the network to handle a higher volume of transactions. The script mentions a developer named 'Rose' from the Lightning Network, indicating the importance of such technologies in the evolution of Bitcoin and its use cases.

💡Gig Economy

The gig economy refers to a labor market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs. The video script discusses how the convergence of Bitcoin and AI is redefining the division of labor, particularly in emerging markets, by enabling a micro-gig economy, which could potentially revolutionize the way work is done and paid for on a global scale.

💡Institution Push

Institution push refers to the trend where institutional investors, such as banks, insurance companies, and pension funds, are increasingly investing in a particular asset or market. The script talks about the growing interest of institutions in Bitcoin, which is expected to drive up its value due to the scarcity of Bitcoin and the increasing demand from these large investors.

💡Scarcity Value

Scarcity value is the concept that an item's value increases as its availability decreases. In the video, it is mentioned that there will only ever be 21 million Bitcoins, creating a real scarcity value. This limited supply is a key factor in Bitcoin's potential for price appreciation, especially as more institutional investors seek to own it.

💡On-chain Analytics

On-chain analytics refers to the analysis of data that is recorded on a blockchain, which can provide insights into the behavior of users and the state of the network. The script mentions a metric called 'long-term holders,' which is an on-chain analytics metric that tracks wallets that have not moved their Bitcoin in over 55 days. This metric is used to gauge market sentiment and the potential for price movements.

💡Multiomic Space

The term 'multiomic space' likely refers to an area of research and application that involves the integration and analysis of multiple types of biological data (omics data), such as genomics, proteomics, and metabolomics. In the video, it is suggested that companies with deep domain expertise in AI and the multiomic space are particularly well-positioned to benefit from the advancements in AI technology, indicating the potential for significant innovation and growth in this area.

Highlights

Bitcoin ETF success, ranking as the third largest ETF, and its impact on the industry.

Wirehouses like Morgan Stanley and UBS have not yet approved Bitcoin on their platforms, indicating potential for future institutional growth.

Bitcoin is described as a new asset class and a global monetary system without government oversight.

The importance of Bitcoin's decentralized and rules-based nature in the context of monetary systems.

Discussion of the convergence between Bitcoin and AI, particularly in Africa, and its impact on the division of labor and gig economy.

The potential for Bitcoin to redefine economic structures in emerging markets.

A bullish forecast for Bitcoin, predicting a value of $1.5 million in 5 years (by 2027).

The low correlation of Bitcoin returns with other assets, making it an attractive option for diversification.

The scarcity of Bitcoin, with a maximum of 21 million coins, and its potential impact on price.

Observations on institutional investment in Bitcoin and its effect on price dynamics.

Analysis of on-chain analytics, particularly the behavior of long-term Bitcoin holders.

The unusual stability of long-term holder wallets despite recent price increases.

The role of different blockchain networks like Ethereum and Solana in the crypto ecosystem.

The importance of competition among blockchain networks for maintaining integrity and innovation.

Discussion on reducing transaction costs and the impact on global purchasing power.

Addressing the question of whether the current crypto market is a bubble and the argument against it.

The potential overvaluation in the market due to an excess of capital chasing the same assets.

A shift in focus from Nvidia to undervalued companies with potential in AI and domain expertise.

The significance of proprietary data in determining the success of companies in the AI space.

Invitation to subscribe for updates on crypto news and market insights.

Transcripts

Bitcoin congrats on your ETF it's done

very well you're number three now number

three you know this was David against

Goliath and you know uh so this is a a a

a very nice win for us now we're not

finished and in fact in our business

what's interesting is the wirehouses

which dominate our customers so Morgan

Stanley all the advisers at these

warehouses Morgan Stanley UBS maryn at

BFA Wells Fargo not one of them has

approved Bitcoin on its platform that

hasn't even happened yet and those are

our primary clients when that happens

wait until you see explosion in the

institutions coming on um and then

governments following um I mean the the

the ship is sailed yes it has and this

there there this is not just a

technology

um it's a new asset class right and

beyond that it's a global monetary

system you know it is the first

Global uh private meaning no government

oversight digital and

decentralized rules-based that's the

most important word here rules-based

monetary system in history it's a big

idea we we did um something called

Bitcoin brainstorm we do a Bitcoin uh uh

brainstorm monthly and one of them was

the converence between uh Bitcoin and Ai

and we had uh you'll probably know of

his his developer name Rose be uh from

the lightning from the lightning Network

on and he was talking about how in

Africa already this convergence

is redefining division of labor uh I

mean the gig economy we understand here

in the United States put that on

steroids in terms of micro micro gig

economy in the emerging markets and you

have a a a whole whole new kind of

economy so yes very exciting well uh we

have all kinds of uh metrics but when I

was uh at uh abundance

uh the uh the forecast was our bull case

was $1.5 million in 5 years so that

would have been 2027 we still have time

and uh and we still think that's going

to be right um if you just look at the

institutional push into Bitcoin this new

asset class they have to consider it as

fiduciaries when you use that Co those

code words new asset class what it means

the the correlation of these returns are

very low compared to those of other

assets especially as bonds and stocks

are becoming more correlated you need

something uncorrelated yes absolutely

absolutely and so they have to consider

it now what are we saying there are 19.6

million Bitcoin out there right now and

the highest it will ever go is 21

million uh well okay there's real

scarcity value and what what is going to

happen the price increase for every

institutional dollar pushing in now is

going to be much higher than it

was last year two years ago it's you

know we're going to get uh into if these

institutions really want to own it what

I found fascinating recently just

learned it this morning is uh typically

when you go through a a price move a

bitcoin price move to the upside you

usually see long-term holders which is a

metric we monitor it's an onchain analy

analytics metric um and it means people

who have not moved or wallets that have

not moved their Bitcoin in 55 days or

more yes well normally when you go

through a price move to the upside a

very nice one like we've seen in the

last year that tends to start moving

down and it did that true to form but it

has reversed in recent days because what

we learned is uh

gbtc sold some of its Bitcoin so that

was those wallets hadn't been changed in

a long time right now that is done at

least for the time being now that is

done and um it's going back up again as

the price goes up that's highly unusual

and I think it is because um the

long-term holder saying why would I sell

now when I know all these

institutions which own nothing own

nothing in this realm in this new asset

class they have to consider it because

it is a new asset class and so so uh yes

we're um very excited about the ethereum

network and salana and so they all play

different roles and what I love is

there's kind of a little competition I

think competition is always good uh to

keep the other networks honest yeah when

we did our digital Wallet work um you

know we we're saying okay let's try and

figure out how much it how many steps it

takes for a merchant or for a consumer

to pay a merchant and that was nine

steps including the two of them uh and

that's and and you know there are many

other middlemen but these were the most

direct steps and that is a one well a 2

to 4% tax on every purchase in the world

if you're using uh intermediaries credit

cards and so forth so uh just think

about that cutting you know that tax

rate dramatically is is going to

increase access dramatically yes and so

here is the question there that we're

getting all the time is this is this a

bubble

and the way we are answering it is no

this is not a bubble this is there's

something Elric electricity a bubble

exactly exactly now is there too much

Capital chasing you know chasing the

same thing um that could be I can tell

you you know we've had in in uh and you

know the headlines I'm I'm not saying

anything that that you don't know but uh

we have been pulling away from Nvidia

mostly because we see how well

understood that story is and it is um

and and all praise to Jensen Wong and

his incredible team uh you know they

have done so much of the heavy lifting

uh uh up you know as we've evolved to

this uh level now however

it is we're the companies in our

portfolio that are hugely undervalued

and not recognized for uh what AI is

going to enable are those with deep

domain expertise and especially in one

of your favorite areas Peter um the

multiomic space so deep domain

expertise AI expertise take this

seriously this is going to determine

winners and losers good distribution

whether alone or with partners and then

finally most important harnessing that

proprietary data data that a company has

that nobody else has thank you for

joining us today on this insightful

journey into the world of crypto and

investing if you found value in today's

discussion and want to stay updated on

future crypto news and Market insights

don't forget to hit subscribe button

below and click the notification Bell by

subscribing you'll be part of our

growing community

gaining exclusive access to timely

analyses and strategies I look forward

to having you with us in the next video