Portfolio manager and crypto analyst Mati Greenspan says billions of dollars are essentially sitting on the sidelines, ready to move into Bitcoin, Ethereum, XRP and the altcoin market at large.
Greenspan is using data from the crypto research firm Messari, which shows that the total value of all stablecoins is just shy of $6 billion. Stablecoins are digital currencies that are pegged to traditional assets like fiat. They’re designed to maintain a steady value and offer crypto traders an easy way to sidestep the extreme volatility of the crypto markets.
Greenspan’s theory implies that the billions of dollars in the stablecoin market represent traders who have decided to exit their positions in BTC, ETH, XRP and other crypto assets and are waiting for the optimal time to re-enter the market.
Binance Research released a report in November on the habits of 69 clients with crypto allocations ranging from $100,000 to $25 million.
The report found that 96% of those investors are using the stablecoin market, with Tether (USDT) ranking as the favorite.
“USDT is the dominant stablecoin with 40.25% usage, holding the top ranking for both Chinese and English survey respondents. USDC, TUSD, PAX are following close behind USDT, and several English survey respondents wrote in BUSD under ‘Others’, reflecting an initial interest by our institutional & VIP clients…
Putting the broader results in line with respective market capitalizations, the overall use for each stablecoin is roughly in line with the rank of its respective market capitalization.”
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Raoul Pal, former executive at Goldman Sachs, predicts Bitcoin will be the best-performing asset over the next decade.
According to Pal, co-founder and CEO at Real Vision, an on-demand financial TV channel where major investors share their best business ideas,
“If I could only own one asset for the next 10 years, it would be bitcoin $BTC. It encapsulates all of my larger macro views and feels like the point on the far horizon we are headed to, in some shape or form. Yes, like gold too and many other things but BTC risk/reward beats all.”
Pal has a long history with Bitcoin. He was an early investor who sold all of his holdings in June of 2017, calling BTC “a solution looking for a problem.” But in an August 2019 interview on the Stephen Livera podcast, Pal said he thinks the highly volatile and risky cryptocurrency is worth investing in even if there’s only a 1% chance it succeeds.
“I know all these macro guys, they’re all in it. They get it. They get the optionality. They may be complete believers, part believers, partial believers. But even then, if it’s a 1% chance of being right and the upside is 100x from here, you’d do this all day.”
Pal previously managed the GLG Global Macro Fund in London for GLG Partners, one of the world’s largest hedge fund groups, and ran the hedge fund sales business in equities and equity derivatives in Europe for Goldman Sachs.