Nov 28, 2023

Bitcoin (BTC) has slipped from 18-month highs seen last week, but many crypto traders remain optimistic about a spot bitcoin ETF approval in the U.S. This comes as the Fed is expected to cut rates by 100 basis points next year, becoming the most dovish among advanced nations' central banks.

Video transcript

Bitcoin has slipped eight from 18 month highs seen last week. But many crypto traders remain optimistic that regulators will soon green light a spot. Bitcoin ETF in the United States joining us. Now to discuss the crypto markets is GSR markets co-founder and President Rich Rosenbloom. Welcome back, Rich. Thank you. Good morning. Good to see you again. Uh OK, so WW we had this uh pull back uh from around the 80 38,000 range. W what do you think uh what do you think caused that sell off that recent sell off? Is it just profit taking or other things in uh in play? Yeah, I think the market is starting to find itself um you know, a little bit long. Um It's the probably the first time in two years where it seems like there's just overwhelmingly bullish news. Um It's, you know, been a little bit tainted by the, you know, recent um uh actions against finance and, and, and crack in. So I think that, you know, a little reminder of the, the regulatory weight in the market probably took it down, but probably more so the positioning than the actual negativity because at the same time, these are they long term bullish catalysts. So in other words, you, you think that people in the market were just looking at it and saying, wait, how do we get here? Why are we here? No, I think people are looking for it to, to go up substantially from here, but markets don't go up in a straight line. So given some of the, the recent negative news um from the regulatory environment in the in the US, you know, seeing a bit of um you know, whether it's profit taking or people um just getting out until the, the momentum looks like it's uh regrown strength. We, we have the Bitcoin. Oh yeah, I was just gonna ask you quickly, we have the Bitcoin having coming up, of course, everyone is expecting this ETF approval next year. Where do you think the market is heading? I generally think uh the market's heading higher. That's why I've been in this industry for over half a decade. Um I think for the ETF specifically the obstacle of the, you know, political well being against it, I think has, has mostly been listed. Now. It's more of the, the practical path being paved. You could see that uh the sec is having, you know, in depth conversations about, about custody and really engaging in a informative fashion um with the the important players. So, um whether it's coming in in January, you know, maybe it's 40 50%. I think it's getting close to 100%. It's going to happen next year. But you say higher, the number uh uh no, no formal call. I said we're going to go up to 28,000. Um the start of this year and we, we far surpassed it. Um It, it's, it's hard to put a specific number on, but I think, uh you know, a approaching new highs, you know, around that 65,000 marker seems like a reasonable estimate. And then it's on to a bajillion. So Dydx, uh they're gonna have about uh nearly half a billion dollars worth of tokens uh going into uh add to the supply here. Uh Is it, is the market able to sustain all these unlocks? You know, this is a fairly large unlock. It is the market. Does it have an appetite for alt coin unlocks at this moment and more supply? Yeah, I'd say uh if you mean at this moment, meaning this last month or so, when we've seen some of the alt coins multiply in price, I would say, yes, it's unclear if this moment is gonna continue for the next few months based on what I said a minute ago, you know, I think, I think it, it will. But a couple of things I mentioned one is that, that when these unlocks happen, it's not that it's out of nowhere. There's, you know, often years ahead of time where the market has to digest it because there's going to be futures, you know, perpetual futures and groups have, have hedged ahead of time. And also if, even if they're not hedged, the market knows that supply is coming. So in a way that things are, things are priced in already. And in terms of the, the demand, even if you're not seeing that demand specifically for, for a what happens if, if there is 50 70 billion of demand coming for um Bitcoin. Once the ETF is uh green lit, then the current holders of Bitcoin, they're the ones who are gonna have to be selling this Bitcoin to the newcomers. When they sell it, they're gonna put part of that cash into ALTs. And so the the size, um you know, if you mentioned it's uh 600 million or so, if that's for a particular alt, you know, which one, you know, agnostic, yeah, might weigh on a specific um alt coin. But I think that the way tonos work is meant to be as you as you have, not just speculation but active use of the project's token. Um the tokens will be absorbed, not just through speculation but through their, their use case within a particular protocol to have that um internal um authentic demand as well as uh speculations from investment. All right. And I want to get your thoughts here on some new research out of Deutsche Bank. They think the Fed could become the most Dovish among advanced nations, central banks, as traders predict that it will cut rates by 100 basis points in 2024. Where do you think the fed is heading next? Yeah, I'm not, not really a rates prognosticator. I, I think that the, the future is, is pretty uncertain. Um, you know, we're in an election year, there's um, potentially, uh another major wave of, uh COVID coming. Um, and also, you know, there's, there's geopolitical risk which does feel like it's uh we, we're one Yemeni missile away from needing a much bigger, uh you know, money printing than 100 billion. So I think that there's a lot of risks for um you know, interest rates if we're dropping them by 100 basis points in a year from now. And it's because we've gotten back towards our inflation targets. And um you know, the, the market looks like it's gonna gradually rise, then, you know, crypto is gonna gradually rise with it. But if we've dropped 100 basis points because of um a uh a problem like a surge in COVID or um you know, another major war that's going to cause a lot more money printing. So I think that's gonna, what's gonna cause, you know, Bitcoin to, you know, approach those new all time hives relatively quickly. All right, rich. We are gonna have to leave it there. Thanks so much for joining us this morning. Always a pleasure having you on. Thank you. Have a great day. That was GSR Market's co-founder and President Rich Rosenbloom.

Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.