Pomp on Bitcoin's price rally: "Institutions are starting to come in"

15 May, 2019
by Richard Allen
Pomp on Bitcoin's price rally: Institutions are starting to come in

Founder and partner at Morgan Creek Digital Assets, Anthony Pompliano sat down with CNBC’s Squawk Box and Kevin O’Leary to discuss the Bitcoin’s impressive price performance.

Pompliano begins by saying “the Bitcoin bulls are back,” referencing CME’s Bitcoin futures volume crossing $1.2 billion as well as trading volumes on exchanges reaching new highs. When asked why the Morgan Creek co-founder explained:

“I think there are two things. One, definitely institutions are starting to come in. You see Fidelity announcing that they’re going to start their custody and trading, Bakkt has set their deadline for July but retail also comes in.”

Pomp continues, explaining Bitcoin is a scarce asset, and with the halvening about a year away, it's set to become much more scarce. “Historically, that’s been a big moment in terms of a price driver because it reminds people that there’s only 21 million of these,” the co-founder said.

The other factor Pomp believes is driving Bitcoin is the trade war. “This idea that we’re watching essentially a trade war play out on Twitter. You look at non-sovereign currency and I think there’s some kind of safety.”

Pomp was then asked if he believed Bitcoin would take a dip if the trade war is solved. “It could,”  he said. He explains that when looking at the macro trend, Bitcoin has seen three drawdowns over 80% in its lifetime. He then compares Bitcoin to Amazon stocks, saying the two have very similar historical movements.

Bitcoin, however, continues to set new yearly lows. “And again, it’s just supply and demand. If you have a scarce asset and demand increases” prices are driven up.

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