Bitcoin may start to lose its reputation as a volatile asset.
Bitwise Asset Management’s Matt Hougan said cryptocurrencies’ wild price swings have declined significantly over the past decade.
“What’s driving the Bitcoin market right now is just a simple imbalance of supply and demand,” the company’s chief investment officer told CNBC’s “ETF Edge” on Monday. “We’re getting a huge source of new demand from these ETFs, but we’re lacking supply. elasticity.”
On January 11, the first Bitcoin exchange-traded fund began trading. The asset has since gained more than 50%. Bitcoin It hit an all-time high of nearly $74,000 this week.
However, Hogan admits this may not be for everyone.
“It changes a lot. Some people find it hard to understand,” Hogan said.
While Bitwise is betting on the growth of Bitcoin, ProShares has an ETF that hopes to profit from losses on its Bitcoin. Short Bitcoin Strategy ETF. It is down 42% so far this year and plummeted nearly 70% last year.
“To quote Mark Twain, ‘Reports of our deaths are greatly exaggerated,'” ProShares’ Simeon Hyman told CNBC. “We’re excited to be here and we think we’re becoming a critical alternative.”
Hyman, the firm’s global investment strategist, noted that Bitcoin’s historical strength has lasted much longer than the launch of the spot Bitcoin ETF.
“This month marks the anniversary of the collapse of crypto-related financial institutions. Last year, Bitcoin was also rising,” Hyman said. “I think some long-term investors are starting to get in for asset allocation and diversification purposes.”
Hyman’s ProShares also operates a long Bitcoin ETF: ProShares Bitcoin Strategy ETF. It’s up 55% since January 1 and 111% last year.
As of Friday evening, Bitcoin was up 180% in the past 12 months.
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