Dan Morehead, the founder and CEO of Pantera Capital, has recently stated that crypto may be the only safe asset class for investors during the next economic downturn.
In a recent interview on the Bankless YouTube channel, Morehead revealed the reason for hoping to see cryptocurrencies serving as a safe haven for investors during a broad financial crisis.
According to Morehead, the crypto markets will prove to have a unique resiliency towards tightening monetary policy. Unlike bonds, real estate, and equities, Morehead says crypto assets will likely be unfazed by rising interest rates, which most market participants are already anticipating.
Pantera Capital founder added that an asset such as Bitcoin (BTC) should remain indifferent to changes in interest rates.
Dan Morehead noted:
“I’m massively bullish on crypto right now and I think that the reason is because every two years, for the last 10 years, an order of magnitude more people come into crypto, so I think that steady flow of just smart people reading about it is coming.
“But the other asset classes being destroyed think is going to sink in. Basically, there’s almost nowhere to hide. That’s why we call it the ‘great unwind.’ Everything except crypto I think is really going to be impacted.
“If we’re even partly right, bond yields are going to go to five percent or higher, obviously that crushes bond prices but it has to impact stocks and real estate and anything else that has a discounted cash flow.
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“So I think for a normal investor looking at the kind of normal asset classes…they’re going to just say ‘hey, if we have money to put to work, it’s hard to imagine putting it to work in any of these other things,’ and crypto should be completely disconnected from interest rates.”
“There really isn’t any reason that a utility token like Bitcoin should really care if rates are zero, five, ten percent. I don’t see why it should matter so I do think they will decouple which is a story we’ve been all talking about for a decade.
“The reality is Bitcoin’s typically not correlated with everything else but it does get really correlated in these stress moments when the S&P comes off a big bunch.”
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