As a seasoned crypto investor with a keen eye for market trends and a knack for spotting opportunities, I find Fred Thiel’s optimistic outlook on Bitcoin intriguing. His insights into institutional interest, regulatory environment, and political developments resonate with my own observations. The potential impact of favorable regulations in the United States, coupled with global adoption, could indeed propel Bitcoin to new highs.
On Monday, I had the opportunity to express my optimistic views about Bitcoin in an interview with CNBC, serving as the CEO of Marathon Digital Holdings (NASDAQ: MARA). I highlighted the increasing institutional interest and a conducive regulatory landscape that could potentially drive Bitcoin’s price to unprecedented heights.
Thiel downplayed the influence of the latest Bitcoin halving, asserting, “I believe the halving made no difference at all.” Instead, he linked the rise in Bitcoin’s price to the debut of spot exchange-traded funds (ETFs) earlier this year. According to him, “In January, the launch of ETFs sparked a sudden increase in institutional interest.
Over time, individual investors mainly invested in these ETFs; however, Thiel noticed a change as institutional investors such as pension funds entered the market, also showing interest in ETFs tied to Bitcoin and companies like ours or MicroStrategy’s.
As an analyst, I’ve observed that political developments, specifically the stance of a certain candidate like Donald Trump, who was pro-Bitcoin, can significantly influence the Bitcoin market. His proposed policies, such as a Bitcoin strategic reserve and encouraging mining within the U.S., could potentially foster a more favorable regulatory climate in our country, which might positively impact the BTC market.
His explanation suggested that the recent developments have led to a strong belief that the regulatory climate for Bitcoin and cryptocurrencies in the U.S. is about to improve significantly, possibly even with increased investment in Bitcoin by the U.S. government. This expected change could put pressure on other countries to enact similar policies, ultimately promoting global acceptance of these digital currencies.
Thiel additionally highlighted the strong market mechanisms that were handling selling pressure from long-term Bitcoin holders. In his words, “Every single Bitcoin ever bought was showing a profit, and long-term investors who had owned Bitcoin for years started to sell a small amount to cash in their gains.” However, he underscored the market’s strength: “The demand in the market is so high that it simply continues to absorb it all.
Speaking about Bitcoin’s historic price swings, Thiel suggested that severe dips could be a thing of the past, at least in the short term. “The dramatic drops experienced in previous years, where a peak would be followed by a 20% or 30% drop, I believe are no longer an issue for the immediate future,” he commented. He is convinced that institutional investors will actively enter the market. In his opinion, these institutions are eagerly waiting to invest heavily in Bitcoin.
He used examples from current business practices by significant companies to reinforce his perspective. For instance, he pointed out MicroStrategy’s action of issuing a $3 billion bond and their aggressive acquisition of Bitcoin. “We too issued a $1 billion bond at zero interest the same week as Michael Saylor,” he added, “and we procured hundreds of millions of dollars worth of Bitcoin.” Thiel underlined that this trend is on the rise, with more people following suit.
Summarizing his views, Thiel expressed optimism about Bitcoin’s rising trend. He explained that those selling are doing so into a market with strong demand, suggesting that for the near future, we can expect Bitcoin’s price to fluctuate (going up and down) but overall, it will likely continue its upward trajectory.
Significantly, the financial firm Cantor Fitzgerald has raised its projected price for MARA from $33 to $42. This revision is due to Mara Holdings’ successful completion of a significant $1 billion convertible note offering last week. Out of the $980 million raised, Mara utilized $199 million to retire $222 million in principal of its 2026 convertible notes. With approximately $781 million still available from this offering, Mara intends to acquire more Bitcoin, emulating a strategy similar to MicroStrategy (MSTR).
On the other hand, while MicroStrategy concentrates solely on strategic financial moves to acquire Bitcoin, Mara stands out by running the biggest publicly-traded Bitcoin mining operation in terms of hash rate. This aspect is emphasized by analysts at Cantor as a significant point of distinction with promising prospects.
At press time, BTC traded at $92,531.
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2024-11-27 01:35