Animoca Brands’ founder Yat Siu, who is one of the biggest blockchain investors in the world, reckons this is the time to hunt for deals.
One of the biggest crypto investors in the world has come out with a bold claim. Yat Siu, who is Animoca Brands’ founder, recently told Bloomberg News that, from his perspective, “Now is the time to deploy more capital, not less.” He also compared this crypto downturn to the crypto downturn of 2018, saying: “If people say this is a crypto winter, then 2018 was the crypto ice age.”
While his optimism is to be expected (he is one of the biggest investors in the world in the blockchain space, and so has a lot riding on the market’s recovery), he’s not alone in his bargain hunting. In a context where the 8 months leading up to August saw the blockchain industry lose more than 60% of its total value, with nearly US$2 trillion wiped from the space entirely, the market has – over the last month – seen something of a stabilisation (today, on August the 23rd, Bitcoin is worth AU $30,903.12, while on July the 23rd it was AU $32,414.96).
Many people in the space remain positive. A popular phrase that did the rounds at NYT NFC echoed a similar sentiment to the one we heard Siu tell Bloomberg News: “It’s not a bear market. It’s a build market.” On top of that, despite the plummeting prices of web3-based assets, a recent Telstra report found that boots-on-ground blockchain developers have never been busier.
Then there’s institutional investors. As The Motley Fool reported in August: “Some institutional investors appear to be preparing to take new positions in crypto, potentially leading to a broad-based market recovery.”
The Motley Fool added that “the key catalyst for Bitcoin is the sudden interest of institutional investors in crypto as an asset class, as best exemplified by the Coinbase-BlackRock [the largest asset manager in the world] deal.” The Motley Fool also reported that “the key catalyst for Ethereum is the upcoming technological upgrade known as the Merge, which could usher in a new era of decentralized applications.”
Given volatility is predicted by many experts to remain par for the course for crypto, many investing experts and financial advisors say you shouldn’t sink much of your portfolio into crypto, and should first focus on saving an emergency fund and paying off high-interest debt (and investing in a reliable, well-rounded stock portfolio).
“You have a high chance of losing it all, but a small chance of winning it big,” Nate Nieri, a CFP with Modern Money Management in San Diego, California told NextAdvisor, for instance. “Don’t gamble an amount that would burden your family or prevent you from achieving your goals” [if you lost it all].
Warren Buffet is even more critical. He has previously said Bitcoin is “probably rat poison squared” and that he will never own any of it. He also reportedly (per CNBC) said at a Berkshire Hathaway meeting earlier this year: “Whether it goes up or down in the next year, or five or 10 years, I don’t know. But the one thing I’m pretty sure of is that it doesn’t produce anything.”
“It’s got a magic to it and people have attached magic to lots of things.”Warren Buffet
Holding up a $20 note, Buffet said: “Assets, to have value, have to deliver something to somebody. And there’s only one currency that’s accepted. You can come up with all kinds of things — we can put up Berkshire coins… but in the end, this is money.”
“There’s no reason in the world why the United States government … is going to let Berkshire money replace theirs.”
“If you said … for a 1% interest in all the farmland in the United States, pay our group $25 billion, I’ll write you a check this afternoon,” Buffett said.
”[For] $25 billion I now own 1% of the farmland. [If] you offer me 1% of all the apartment houses in the country and you want another $25 billion, I’ll write you a check, it’s very simple. Now if you told me you own all of the bitcoin in the world and you offered it to me for $25 I wouldn’t take it because what would I do with it?”
“I’d have to sell it back to you one way or another. It isn’t going to do anything. The apartments are going to produce rent and the farms are going to produce food.”