Pantera Capital CEO says cryptocurrencies are the best asset for preserving wealth

Digital assets will become the “best place” to preserve capital after the completion of the Federal Reserve’s rate-hiking cycle. This was stated by Dan Morehead, founder and CEO of Pantera Capital.

#Bitcoin is down -19% year-on-year — during a period when the Fed printed $5 trillion — seems cheap.

The Next Mega-Trade: https://t.co/kfWepItKpe pic.twitter.com/MgGz2bD6BB

— Dan Morehead (@dan_pantera) February 17, 2022

“Investors must invest in something. If rates rise, blockchain will become the most attractive. I expect the linkage with traditional financial markets to weaken soon. Bonds will be ‘crushed’, stocks and real estate in a high-rate environment will become less interesting. Blockchain will prove to be a genuine realm for investment”, — he explained.

Morehead noted the absence of cash flows in cryptocurrencies, which links them to gold. The executive pointed out that digital assets may behave differently from rate-sensitive financial instruments.

The Pantera Capital CEO stressed that the value proposition of cryptocurrencies remains unchanged, and the decline in prices in recent months has been driven by the reaction to Fed signals and the approaching end of the US tax year.

“Over the past year, the market capitalization of digital assets rose by $1.4 trillion. This could have driven a meaningful portion of recent selling”, he explained.

Morehead warned that before returning to a growth trajectory the market could experience a series of ups and downs.

Earlier in October, the Pantera Capital CEO allowed the formation of a wave of selling of the first cryptocurrency after approval ETF based on Bitcoin futures.

Earlier, JPMorgan strategist warned of a crash in the crypto market after the Fed raised its key rate. Analysts at Glassnode recorded a reduction in leverage and a rise in put-option purchases ahead of the Fed’s March meeting.

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