The CEO of One River Asset Management says his company now owns bitcoin worth “well over” $ 1 billion. He revealed that the institutional interest in bitcoin is “astounding,” noting that nearly all major US institutions are debating the cryptocurrency. He believes bitcoin will be worth more than gold, worth around $ 500K.
The CEO of One River Asset Management is a Bitcoin Bull
One River Asset Management CEO and co-founder Eric Peters shared his views on bitcoin at length in an interview with Bloomberg last week. First, he revealed that his asset manager now holds bitcoin “Currently well over a billion dollars.” He then discussed the case for institutional investors to currently own cryptocurrencies.
“We are now in a unique period,” said Peters. It is the period that has happened many times throughout history when “governments become extremely indebted, monetary policy becomes less effective, and eventually governments … have to spend and actually spend a lot of debt. When they do, they do. they usually try to relieve themselves of the debt they incur by lowering the currency in which they spend that debt. ”The CEO added that“ those who own that currency end up losing their purchasing power. ”
He went on to talk about crypto assets, stating that they are “really interesting in the sense that they are a new asset class altogether.” He noted that they “have some unique properties, some of which are similar to those you’d find in gold, except that they are hugely under-priced compared to gold.”
In addition, bitcoin and other cryptocurrencies have “technological properties” and “will look different tomorrow, next year and in a decade”. This makes bitcoin “unique to gold, because if gold looked the same two thousand or two billion years ago, it will look the same two thousand and two billion years from now,” described the president of One River, elaborating:
I think you have to be a real pessimist to think that an emerging technology platform isn’t getting more interesting, more useful, more valuable.
He further explained, “It is very rare to find an asset that allows you to take advantage of future benefits [the technologies] while also softening the downside [monetary debasement] like that.”
Peters also clarified that he always starts with the macro aspect when it comes to investing as he has been a macro investor throughout his career. With technology, the CEO opined:
I’ve seen enough to know that tomorrow will look essentially better than today. When you invest, it’s incredibly important to know: Will tomorrow look better, worse, or the same? I think I’ve seen enough to understand that tomorrow looks better in these assets than today.
“We spend huge amounts of debt. We let our central bank buy them … the scale of them is so profound … so the question is, in that environment, what are the assets you can own, ”he continued.
Peters went on to list some plausible investment options: stocks, gold and digital assets. He claimed that digital assets are “dramatically undervalued compared to some of these other valuable stores,” which is why his company is “excited” about this, emphasizing that “it’s just an underrated asset to that macro backdrop.”
The One River CEO also praised bitcoin’s solid offering. He stated, “It’s unlike any asset I’ve seen in the world in the sense that no offer is responsive to price. If bitcoin increased in value five times, or 10 times or 100 times, no more bitcoin would be produced. You can’t really say that about anything else in the world. “
He also compared bitcoin to gold. “I think at some point it will be worth more than gold, because gold is not infinite. Gold continues to increase in terms of supply, ”he noted. In contrast, there will be only 21 million bitcoins. The CEO explained:
If it just hit the market cap of all the gold in the world, it would add up to something on the order of $ 500,000 per bitcoin.
“Right now, it’s trading at, say, $ 30,000, so if you look at it from a trader’s perspective, there’s tremendous convexity at the top,” he confirmed.
In answering a question about how long it takes for bitcoin to become more valuable than gold, Peters said it is “policy dependent”. He could see it happen in a few years’ time when we see “some sort of next recession followed by more issues and more purchases from the fed.” Nevertheless, he pointed out that “one of the things about these assets is… it costs you nothing to keep them. You run the price risk down, but you have no negative carry. “
The One River executive also discussed whether crypto assets will appeal to institutional investors if they continue to co-exist with fiat money or whether institutions should see some sort of government or central bank acceptance or approval before jumping in.
After publicly disclosing that his company had invested about a billion dollars in bitcoin, he said that “the number of institutions that have filled my day with calls and questions about this is astonishing.” He reiterated that it is already happening “enormously”.
Peters expects the crypto asset class to “mature in a decade,” adding:
What is happening is that almost every major credible institution in the US is having discussions about this … Many of them call us to ask.
“They are fascinated by this,” he further shared, emphasizing that “it should be because this is the first and last asset class to appear in our lifetime.”
As for how the crypto landscape, including BTC, looks like a year, said Peters, “Prices will be higher.” While he admits volatility will persist, he believes it will diminish as prices go up. He explained that as prices go up, “you’re attracting new types of investors, with stronger hands, frankly … so I think there’s going to be a lot of money drawn into these assets in the coming year.”
He also believes there will be more regulation in an effort to increase transparency for the entire crypto asset class, but regulators will not destroy the asset class as they understand that the future of finance will be digital.
Do you agree with One River’s CEO about bitcoin? Let us know in the comments below.
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