Anthony Pompliano, the Founder of Morgan Capital Digital Investments, recently appeared on CNBC’s Squawk Box to speak about Bitcoin [BTC]’s recent drop and a possible recovery. He also spoke about the general use case of Bitcoin, as well as providing a general outlook on the state of the market.
He began by stating that Bitcoin has experienced two such drops over 80%, with the current drop said to extend to about 85% from its all-time high of $20000, which puts the price at around $3000. He further said that while it did come close over the weekend, it still has a distance to drop.
Pompliano spoke about the price of Bitcoin in December of last year, stating that it was overvalued. However, he did offer his opinion on three things to remember about Bitcoin. He stated:
“This is a transaction settlement layer. It’s the most secure in the world, so it’s gotta be worth something. It can’t be worth zero. It’s the best performing asset class over the last 10 years it’s outperformed SP, Dow, Nasdaq during the longest bull run.”
While he did point out that the asset had experienced two drops below 80% in value, he also stated that the coin is up in value over 400% in the last two years. Furthermore, Pompliano mentioned that the price incline over the course of 2017 was driven by retail investors, with institutions moving into the market. He also clarified that institutions were buying Bitcoin over-the-counter, leading to money flow in markets that do not have transparency or insight.
When asked about whether the price of Bitcoin moving below $6000 undermines the mining process, Pompliano revealed that there are tiers of miners, and that there are even some that produce the coin for anywhere between $2000 and $3000. He also clarified that his firm has been buying in from when the coin was dropping from $20000, attributing it to a “deep conviction in over a long period of time”. On the drop, he stated:
”What you saw is this washout that people who are spending $6000-$6500 to create Bitcoin they’re underwater now.”