Real Vision CEO Raoul Pal and Dan Tapiero, Founder and Managing Partner at 1RoundTable and 10T Holdings recently spoke about their macro-outlook and the life changing opportunities in crypto.
Crypto – A Long During Asset
Tapiero and Pal spoke about the 1980s and 1990s, when the bond market attracted the brightest minds, but now, they believe, the most intelligent investors have moved to areas with greater opportunities, like digital assets.
Pal reflected on the generational divide in understanding and accepting new investment sectors like crypto. He highlighted the significance of deep research in understanding these emerging markets, considering them as pivotal macroeconomic developments with long-term impact.
This is a long during asset – you need a long-term time horizon. If you got a long duration, you should be buying in the sell-offs and not selling […] Most VC Investors are waiting for prices to go high before buying.
U.S. Losing Influence – Again
Pal emphasised the need for a deep understanding of the complexity and significance of digital assets, describing them as an “invention” and a “security truth machine.” The conversation also touched on regulatory challenges in the U.S., contrasting it with more favourable regulatory environments in other regions like Singapore, Hong Kong, and the UAE, where digital asset businesses are increasingly moving.
Pal added that historical financial market developments, particularly in London, became a hub for various financial markets due to U.S. protectionism and regulatory constraints. He suggested that a similar shift might occur with digital assets, with other global financial centres potentially taking the lead if the U.S. remains restrictive.
What’s a bit strange is that you have people in positions of authority like Gensler, who are actively attacking, so its not like they are even neutral. He doesn’t talk about all the benefits, ever. It’s absurd.
Different Regions – Different Use Cases
Globally, the interest in crypto and blockchain has been more robust, particularly in Asia and the Middle East. In the United States, however, institutions such as endowments and pension funds are still lagging in understanding and investing in this space. Tapiero suggested that U.S. institutions might only begin significant investments when crypto like Bitcoin reach higher valuations.
Each of the different regions around the world has different use cases that excite them […] Paris Blockchain Week is all about the luxury goods companies trying to figure out NFTs. Its gaming in Asia, the Middle East is more about cryptocurrency and savings technology.
Tapiero noted emerging trends in the blockchain space, particularly in real-world asset tokenisation and the development of stablecoins. This trend is seen as a significant step forward in the broader application of blockchain technology, suggesting a future where various assets could be tokenised.
Everything, Everywhere – All at Once
Tapiero believes that broad-based adoption of crypto will start with traditional financial players like ETFs validating the space. However, a more comprehensive adoption will occur as companies in the crypto and blockchain sector begin to go public, potentially on global exchanges like NASDAQ, Singapore, or London.
Projecting into the next bull phase, Tapiero anticipates significant growth in the value of major cryptos like Bitcoin and Ethereum. He expects full-scale adoption by the general population, leading to the tokenisation of a wide range of assets.
Interestingly he noted there was still scepticism in the Trad-Fi market, especially doubts about use cases and the apparent speculative nature of crypto. At the end of the day, Tapiero thinks those who dismiss the potential of digital assets will be left behind, as the industry is already substantial and well-established.
Two years ago Larry Fink was ‘this is all fraud and money laundering’ and then he changed in July and says ‘well it [Bitcoin] is a global asset, it’s an important asset.
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