DAS 2021: Crypto Market Could Hit $40T in Five Years
Founders of Morgan Creek Capital Management, 10T criticize hedge fund manager Ray Dalio’s remarks on crypto
From Left: Dan Tapiero, 10T Holdings, Mark Yusko, Morgan Creek Capital Management, and Dan Morehead, Pantera Capital, at Blockworks Digital Asset Summit 2021: Source: Photo by Mike Lawrence
key takeaways
- Pantera CEO Dan Morehead noted that while bitcoin’s market cap could grow by 10 times in half a decade, he expects other crypto segments to go up even more
- Executives counter argument of Bridgewater Associates CIO Ray Dalio that governments will “kill” bitcoin if it becomes successful
The cryptocurrency market capitalization could continue to roughly double in size each year over the next half decade to reach $40 trillion by that time, Pantera Capital CEO Dan Morehead said during a panel at Blockworks’ Digital Asset Summit (DAS) on Wednesday.
While he noted that bitcoin could grow by 10 times during that span, he expects other crypto segments to go up even more. More than 100% of the returns in the cryptocurrency industry have come outside of bitcoin over the last six months, Morehead added.
“Money protection or a digital gold is one of the things blockchain does, but there’s hundreds and hundreds of different use cases — NFTs, DeFi, all that and that’s why it’s so exciting,” he said. “It’s going to go through so many different industries and end up being worth so much value because it’s disrupting things that weren’t touched. Basically all of finance wasn’t touched by the internet.”
The global cryptocurrency market cap today is $2.28 trillion, according to CoinGecko, as cryptocurrency trading volume in the last day was at $144 billion, as of 12:30 p.m. eastern on Thursday. The market caps of bitcoin and Ethereum were at about $900 billion (39.8% of overall market) and $425 billion (18.7%), respectively, the data shows.
Morehead was joined on the Manhattan event stage by Mark Yusko, founder and CIO of Morgan Creek Capital Management, and Dan Tapiero, founder and CEO of 10T Holdings.
Yusko, who estimates a $25 trillion crypto market in five years, said he expects a burst in the crypto market value over the next 24 months, followed by a bust.
“People will [say] it’s over, it’s the end,” he told the crowd. That’s the beginning.”
Yusko noted that he also expects the dominance of bitcoin to decline to about 20% of the overall crypto space, perhaps reaching $5 trillion by 2026.
Meanwhile Tapiero estimated that the crypto market value could hit $20 trillion and said bitcoin reaching a price of $500,000 is “very reasonable” within five years.
Bitcoin’s price was above $48,000 on Thursday afternoon, according to CoinGecko, up 4.3% in the last seven days.
“I don’t know that bitcoin dominance will fall … because there is a world in which things start getting built on bitcoin,” Tapiero explained. “There’s so much innovation happening at such a fast pace that, at least for me, I find it hard to be specific on the bet.”
Can crypto be stopped?
Ray Dalio, CIO of hedge fund manager Bridgewater Associates since 1985, said Wednesday in an interview with CNBC that though he has a small allocation to bitcoin relative to other investments, the growth of crypto could lead to its end.
“It’s an amazing accomplishment to have brought it from where that programming occurred to where it is,” he said. “…I think at the end of the day if it’s really successful, they’ll kill it. They’ll try to kill it and I think they will kill it, because they have ways of killing it.
“It doesn’t have intrinsic value,” Dalio added. “If you put cryptocurrencies, or let’s say bitcoin, in the historical perspective, there are so many things in a historical perspective that didn’t have intrinsic value and had perceived value and then became hot, and then became cold.”
Taperio called Dalio’s comments “ridiculous” during the DAS panel, noting that older investors who are choosing to ignore the benefits of crypto are having their wealth devalued.
Yusko called bitcoin the “greatest money ever invented,” noting that it and gold are the only two forms of actual money.
“That money … will displace all of the bad, crappy money, and that is inevitable and there’s no way to stop it,” Yusko said. “Ray Dalio is crazy to say they can shut it down. No, you can’t.”
The Morgan Creek founder noted China’s first crackdown on bitcoin in 2013, which sent its price tumbling.
“The price fell from $1,400 to $1,000 in two weeks,” Yusko noted. “Where is it today? Is it higher than $1,000? Last time I checked it was, right?’
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