00:00 Speaker A
IPOs getting some love on Wall Street including the debut for crypto brokerage firm Gemini Space Station, while cryptocurrencies are set for weekly gains, investors awaiting the Fed’s September meeting next week when the central bank is expected to cut interest rates. For more on the crypto landscape, let’s get to Bitwise head of research, Ryan Raspsen.
00:23 Speaker A
Ryan, it is great to see you. Maybe start big picture, Ryan. You you look at Bitcoin here, we’re you know at around 116. You know, since we broke to records over the summer, Ryan, we we kind of been moving sideways here. And I’m I’m curious what you make of that. I I’ve heard, you know, some folks talk about it it’s it’s Bitcoin dollars moving out of Bitcoin and into other coins, but what do you make of it?
00:58 Ryan Raspsen
Look, I think we have the general seasonality in Bitcoin that exists across other markets like equity markets and other risk asset markets. And so the summer is slow. You know, the saying, sell in May and go away, isn’t unique to stocks, it exists in crypto. So I think that’s one reason why after reaching new all-time highs a few months ago, we’ve chopped somewhat sideways. I think it’s important to zoom out and look at the performance year-to-date, which has been extremely strong. And I think we’re right around the corner for a heat up in the markets come Q4.
01:31 Speaker A
And when you say heat up, Ryan, what could we we be looking at there?
01:38 Ryan Raspsen
Look, I our target price for Bitcoin at the end of this year is 200,000, which I know is significantly higher than it is today, but we see a lot of demand kind of driving Bitcoin to that price, particularly in Q4 as rate cuts do come in, as advisors, institutional investors look at their Bloomberg screens and think about what kind of assets they want to trade and pile into in a lower rate environment. Bitcoin is just one of those assets that looks extremely attractive right now. We know a Bitwise from speaking with financial advisors and hedge fund managers and RAAs every single day, that they’re more and more interested in getting exposure to Bitcoin. The ETFs make it easier to do that. And the amount of demand coming into Bitcoin is just simply so much more than supply that we believe the price could snap up to that 200k range in a very short matter of time.
02:40 Speaker A
You mentioned those Fed cuts, Ryan. So, you know, you do have that Fed meeting on deck next week. The expectation is they cut by by 25. Let’s say they do, Ryan, I’m just curious, how do you think Bitcoin would respond and react to that?
03:00 Ryan Raspsen
I think Bitcoin and all risk assets respond extremely well to that. There’s an element of these rate cuts that certainly is priced in. I think the market anticipates at least 25, probably 50 basis points with of cuts by the end of the year. But what I don’t think is that people understand just how quickly Bitcoin moves in a risk on environments while rates are being cut. Historically, Bitcoin has performed remarkably well in low interest rate environments. I think one thing that’s incredible to see is that Bitcoin has notched new all-time highs over the past year and a half, despite interest rates being relatively high for its 15-year existence. So I think we’ll finally get a chance to see now that Bitcoin has started to enter its institutional era with ETFs and with corporations purchasing Bitcoin and with governments and pensions and endowments getting into Bitcoin. Now we’ll finally get to see what impact that has in a low rate environment.