Bitcoin has been trading around the $40k level over the past few weeks but market experts believe BTC will rally higher in the long run.
Dan Morehead, the CEO of Pantera Capital is confident that the cryptocurrency market will record higher growth over the coming years. Morehead his opinion known during a recent interview with Bloomberg.
When asked why Bitcoin is currently underperforming despite the rising inflation in the United States and the non-active nature of the bonds market, Morehead replied that Bitcoin is mirroring the S&P 500. He said;
“There is a very short-term correlation between Bitcoin and the S&P 500 in very stressful times. There's been six of them in the history of Bitcoin and it's highly correlated for about 71 days and then it breaks down. And I really strongly believe that's the case here that there's a knee-jerk reaction that when the S&P gets crushed and bonds get crushed you have to crush everything bitcoin cryptocurrencies.”
However, Morehead stated that when the dust settles and stocks and bonds underperform, more people will turn to cryptocurrencies like Bitcoin. He is confident that Bitcoin will perform excellently independent of the interest rate.
The decentralised finance (DeFi) sector has gained massive interest over the past few years and Morehead believes there is more growth ahead. He said;
“So there is this perception sort of value cryptocurrencies because some don't have cash flow. Some do have cash flows. But it's basically econ one to one supply and demand every two years 10 times more people use cryptocurrency than they did in the past.”
The Pantera Capital CEO said he is confident Bitcoin’s value will increase massively over the coming years. He said;
“I think it actually will be some number like that ($400,000) that all the users use cases that are really rolling out. People are using it. And now institutional investors are really investing in the space from taking it you know like 10 or 20 basis points to maybe 10 years 8 percent of their portfolio or something like that. So I do think what about we'll have that. It doesn't have to be Bitcoin.”
Bitcoin is down by more than 40% from its all-time high but the interest in the leading cryptocurrency continues to increase.