After trading in a narrow range for weeks, Bitcoin (BTC) has dropped to $34,500 and is down more than 50 percent since hitting its all-time high of $69,000. The largest cryptocurrency failed to rise higher and continued to live in the wild. Because according to Kevin O’Leary, venture capitalist, entrepreneur and star of the “Shark Tank” series, there’s a lack of institutional adoption. O’Leary also announced his altcoin investments. Here are the details…
Are cryptocurrencies not as adopted as they seem?
said in an interview at the Bahamas crypto conference, “The reason Bitcoin stays in such a tight trading range is basically because no one owns it. I’m not saying this cunningly. So there are some individual investors, hedge funds and some private funds; however, no sovereign wealth fund has indexed BTC,” he said. The fact that these state-owned mutual funds are not adopting crypto means there is no buyer to support the market when cryptocurrencies drop. “But that could change with even a small investment of 1% that is permanently held at this weight once indexed,” he explained.
Admittedly, the news about the increasing institutional adoption of crypto is considered to be untrue. At the Crypto Bahamas conference co-hosted by 30-year-old crypto billionaire Sam Bankman-Fried and think tank SALT, O’Leary observed that half of the audience were institutional investors or governments that had no crypto ownership. “They are here because they are watching the momentum and policy begin to change,” he said, pointing to the tripartite bill on cryptocurrencies that was passed through bipartisan committees on Capitol Hill to form US Senators Pat Toomey, Bill Hagerty and Cynthia Lummis.
In addition to these laws, US President Biden signed an executive order on cryptocurrencies in March, urging federal agencies to examine the risks and benefits of cryptocurrencies while encouraging the Fed to continue evaluating a central bank digital currency. This has been positively interpreted by the crypto industry as a major step towards regulatory clarity in the US.
O’Leary mentioned his portfolio of altcoins
As an institutional investor, O’Leary states that he has not allocated more than 20 percent of his portfolio to any of the 11 sectors in the S&P 500. O’Leary believes that cryptocurrencies will be the 12th sector of the index. “So we think that Bitcoin and altcoin projects are an industry and we increased our weight to 20 percent. Under such authority, you can only own 5 percent of any asset. This is a classic corporate mandate,” he said. Today, O’Leary holds 32 positions in cryptocurrencies consisting of tokens as well as stocks of crypto companies including FTX, Immutable Holdings, WonderFi and BitZero.
Its strategy is to provide enterprise-grade infrastructure games that support crypto activities and diversify their bets across tokens, projects and companies. For example, its portfolio includes popular altcoin projects Solana (SOL), Avalanche (AVAX) and Hedera (HBAR), Polygon (MATIC), Helium (HNT), and Serum (SRM). O’Leary used the following statements on this subject:
I have to get diversity, that’s my biggest motivation. I don’t need all of them to be successful, I need all four to be successful. This venture is like an investment, you’re lucky to have a 20 percent job, but they pay for all the mistakes you make when they work.
O’Leary is optimistic about NFTs
An avid watch collector, O’Leary is optimistic about how NFTs can disrupt the secondary market that specializes in trading high-end watches. According to consulting firm McKinsey, the pre-owned watch market will reach between $29 billion and $32 billion in sales by 2025. The rapid growth and high value of the asset class also attracted scammers. According to O’Leary, this problem can be resolved if watchmakers simultaneously release an NFT containing all the time information, serial number and all other authentication information. Additionally, they can receive a royalty every time the watch changes hands.
O’Leary is betting on the growth of NFTs through his stake in Immutable Holdings, which has early-stage startups like NFT.com, 1800Bitcoin.com and CBDC.com. Eventually, he thinks, NFTs will become the technology that supports and validates passports, property titles, conference tickets, and driver’s licenses. O’Leary uses the following phrases for NFTs:
Why do I have to carry a card that I could lose when I will have an NFT asset connected to my mobile device and can only show my driver’s license to the police officer? The police can also know via NFT that my identity may be absolutely correct. This use case is coming, and that’s what the NFT platform will be about.
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