Fund manager Brian Kelly says the market is mispricing bitcoin and that “when the price of bitcoin drops so low it is a sign of a downtrend.” He sees a string of “all positive things” reflected in the pricing of the cryptocurrency.
Asset Manager Brian Kelly Says The Market Is Misrepresenting Bitcoin
Brian Kelly, founder and CEO of digital currency investment firm BKCM LLC, was asked about the price of bitcoin in an interview with CNBC on Tuesday.
Kelly manages the BKCM Digital Asset Fund and the REX BKCM Blockchain ETF (NYSE:BKC). He wrote “The Bitcoin Big Bang – How Alternative Currencies Are About to Change the World”. In addition, he was previously a hedge fund manager at Shelter Harbor Capital, where he co-founded. He also co-founded MKM Partners, a brokerage firm that caters to institutional investment managers.
“For me, when you look at bitcoin, it is about network effect and address growth,” said the asset manager. “One of the key indicators I pay attention to when managing crypto money is how fast the addresses are growing and what the market is expecting the addresses to grow.”
Referring to his chart, he explained: “The address growth is basically flat, but the market is acting up, we’re going to have a 20% drop in address growth. We haven’t seen that kind of gap since March 2020 have seen.” Kelly elaborated:
Normally, when the price of bitcoin drops so low it is a sign of a downward process… the market is mispricing what is going on under the fundamentals of bitcoin.
He continued: “So we look to March 2020 when bitcoin was at $3,500 and it went up to $60,000. We are looking at exactly the same type of situation where it looks like bitcoin is trying a downside. “
As for his fund’s investments, he revealed that he “personally added to our fund this month because I think it’s a huge opportunity. At the fund, we are tall and getting tall.”
The fund manager then went on to say, “What I want to see now is, obviously, bitcoin is driven by a lot of momentum, so now we need to follow more prices here and build on that momentum,” emphasizing:
The story hasn’t changed one bit for me. We are adopting institutional. We’re getting an inflationary hedge and regulatory wise, we’re reducing regulation. It’s not going to be banned, we’re talking about getting it into the fold.
“These are all positive things for me and it’s reflected in that pricing for me,” he reiterated.
Kelly was then asked how low the price of bitcoin could be and whether $30K was down. “I don’t know if $30,000 was less,” he admitted. “I have a lot more faith that it was.” However, he added that “Bitcoin has a weird way of making you look stupid.” He confirmed: “If it drops to $20,000, I will definitely buy both my diamonds with my hands.”
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