Steven Ehrlich, the director of digital assets for Forbes, joins "Forbes Talks" to discuss bitcoin surpassing $60,000 and the rise in the overall cryptocurrency market and crypto stocks.
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NewsTranscript
00:00 Hi everyone, I'm Rosemary Miller here with Stephen Ehrlich, the Director of Digital Assets
00:08 here at Forbes, here to talk about Bitcoin surpassing $60K for the first time in over
00:14 two years. Thank you so much for joining me today, Steve.
00:17 Thanks, Rosemary.
00:19 So, Steve, why did Bitcoin surpass $60K today?
00:23 It really just comes down to the same three letters that we've been talking about for
00:27 the last seven months or so, or excuse me, seven weeks or so, ETFs.
00:32 There's been a big surge in demand for these products offered by the likes of BlackRock,
00:37 Fidelity, Invesco, so on and so forth.
00:40 I mean, in fact, I think about almost $15 billion in assets have flowed into these accounts
00:45 and net some significant withdrawals from Grayscale, which is the industry leader.
00:51 I think there's been a net of almost $7 billion in new demand.
00:56 And just in the last couple of days or so, there's been unprecedented surges in demand.
01:00 BlackRock itself brought in $520 million.
01:03 This set a daily all-time record for them.
01:06 So what's really happening is that while I know we've spoken in the past about how Bitcoin
01:12 had a habit of buying the rumor and selling the news, this occurred when Coinbase went
01:16 public back in April of 2021.
01:20 And when Bitcoin Futures ETFs were allowed to trade in November of 2021, this is one
01:26 of those cases where people were buying the rumor and they are also buying the news.
01:33 And speaking of surges, I know Coinbase even crashed today because of the surge.
01:38 I mean, is this a time people should even be buying, Steve?
01:42 This is the highest.
01:43 We talked about this, the highest prices have been in over two years.
01:47 Yeah, it's really funny.
01:49 There's a couple of rites of passage sometimes or just things that always seem to happen
01:53 in crypto.
01:54 I mean, for one, there is kind of a saying among real crypto true believers that you're
02:00 not one of them until you've seen your portfolio drop by 80, 90 percent, your crypto portfolio,
02:06 to be clear.
02:07 And then you held on long enough to see it come back and then eventually surpass that.
02:11 That happened during the ICO crash in 2017.
02:15 That's happened a couple of times in the past, long before crypto really became what it is
02:20 today.
02:21 So I have a feeling that for those of you watching and listening, if you were able to
02:27 hold on through the bear market in 2022, you're obviously feeling pretty good about it yourself.
02:32 And it's actually funny, too.
02:34 Coinbase also has a just because of what I could assume is very peak demand.
02:39 I mean, Bitcoin went up past 63,000, I think, right before we began taping.
02:45 There's exchanges and Coinbase isn't the only one, but it seems like there's a lot of focus
02:50 on Coinbase going down due to overcapacity during times of peak demand.
02:54 So that's just another sort of familiar reminder that we are in a peak hype cycle again.
03:01 Now, your question about whether or not people should buy, it really just depends on your
03:06 long term outlook for Bitcoin.
03:08 I never encourage anyone to buy just based on FOMO, fear of missing out.
03:15 I mean, certainly there could be an argument to be made that there will be a slight retracement
03:21 from from this level.
03:22 I think right now Bitcoin has already dropped from 63,000 to 61,000.
03:26 I would not be necessarily surprised if it moves back into the upper 50s just because
03:30 of how steep the ascent was.
03:32 There's always going to be a little bit of a pullback.
03:36 But if you just think longer out, I mean, what is the what's the real investment thesis
03:41 for Bitcoin?
03:42 What's the case?
03:43 This secure way to store digital value.
03:46 These ETFs have made it unprecedentedly easy for people to get exposure to Bitcoin.
03:52 I've seen some people on Twitter call it like Bitcoin's IPO moment.
03:55 And and then, I mean, there's also a very bullish event coming up in about a month and
04:00 a half that the Bitcoin halving, which is going to reduce Bitcoin's issuance by by half.
04:06 So increased demand from these new channels combined with a supply reduction can certainly
04:12 create the possibility of another surge in price.
04:17 And Bitcoin right now, we are it's kind of broken out past its upper price channel that
04:22 sort of began in October.
04:25 And that began when the SEC basically gave indications that it was going to allow these
04:30 Bitcoin ETFs to begin trading.
04:31 So Bitcoin right now is in price discovery mode.
04:34 And the next marker that the industry is looking towards is is sixty nine thousand seventy
04:39 thousand, which is about where Bitcoin's all time high is when it reached it in April and
04:44 November of twenty twenty one.
04:46 Well, see, I'm speaking with one of my colleagues before doing this interview.
04:50 I'm telling her they're like, oh, wow, crypto, crypto looks like it's back.
04:54 And she was like, then why is everyone panicking so much during the bear market?
04:59 And, you know, that's a kind of valid question.
05:01 It's always kind of come back.
05:03 So why why do we panic so much during a bear market?
05:06 I mean, it's easy for people to I mean, the first or I guess the next rational investor
05:12 I meet will be the first one, especially in terms of crypto.
05:15 But it is it is scary.
05:17 I mean, no one likes looking at their portfolios and seeing assets drop by by 70, 80 percent.
05:23 It's a it's a scary thing.
05:25 I mean, a couple of a couple of things that investors really need to keep in mind.
05:30 I mean, this is an experimental alternative asset class.
05:35 And I think it's important to really not keep more than maybe five percent of your total
05:40 assets in crypto because it is that volatile and and it is susceptible to to hype cycle.
05:49 So those things can can happen.
05:51 But one of the things that really always impresses me about this community is just how resilient
05:58 they are and how strong their belief is in what crypto is trying to to accomplish, especially
06:06 with regards to Bitcoin.
06:07 I mean, Bitcoin, if it is in terms of crypto, the safe haven asset.
06:12 And that's the one that even if investors roll out of other assets, they'll come to
06:16 Bitcoin because I think it has the clearest value proposition.
06:20 It has a monetary policy that is written in stone or I guess written in code to be more
06:26 accurate and cannot be changed.
06:28 And then the other part, too, is just, I mean, the float that the of it is is relatively
06:34 small that.
06:38 Triggers like what happened with the ETF can help it to to recover.
06:41 But there are plenty of people that sell out because they did.
06:45 They were scared of it not coming back.
06:47 And there's there's such a strong community that that always has faith that it will recover.
06:54 And those people are certainly beating their chest today.
06:56 Well, Steve, aside from Bitcoin and ETH, let's talk about the other tokens and even the crypto
07:03 stocks.
07:04 How are they doing today?
07:05 Yeah, it's really kind of a I think a bit of a story between the stocks and tokens that
07:10 are seen as Bitcoin proxies and those that are not.
07:12 I mean, to be perfectly clear, as goes Bitcoin, as Bitcoin goes, so does the rest of the market.
07:20 So I mean, pretty much the entire market is up these days.
07:23 There are a couple of tokens that I think it's very important for investors when Bitcoin
07:29 is going up.
07:30 They're going to start to look into ways to maybe roll into other assets that have higher
07:36 beta that perhaps could outperform Bitcoin during some of these times.
07:40 Stacks is one that's kind of seen as a complementary layer to Bitcoin that's supposed to provide
07:45 like decentralized finance, T5 capabilities to Bitcoin.
07:49 It's outperforming Bitcoin over these last couple last few hours, the last day or two.
07:54 That's sort of a almost like a meme coin that was created on top of Bitcoin, too.
07:59 That's outpacing all of this, although I am in a very non-financial advice way, I would
08:04 not recommend people buy that.
08:05 It's really literally just a meme coin that has very little utility.
08:09 And I'm seeing a lot of movement from on the stock point of view to miners that are doing
08:14 very well today or Marathon and Riot, MicroStrategy, which I believe owns, I think, 10,000 Bitcoin
08:21 at this point.
08:22 It's a company that's led by Michael Saylor.
08:26 It's sitting on a massive paper profit.
08:29 It's doing very well today.
08:31 And Coinbase is surging as well.
08:33 It doesn't really matter, I don't think, in terms of price, whether or not Coinbase has
08:37 gone down.
08:38 If it's not up already, it will be up soon.
08:41 And I think it just kind of shows how much demand there is for.
08:45 Actually, I think it's pretty bullish for Bitcoin because one of the real concerns that
08:49 investors have about Bitcoin is whether or not demand for Bitcoin brokerage services
08:58 might drop in light of these ETFs.
09:00 But if Bitcoin actually went down due to demand, that actually paints a pretty good picture
09:05 for the fact that they're still able to generate retail demand for their transactions.
09:10 So that's actually a pretty good sign for them.
09:13 Well, Steve, do you believe price correction is coming soon or are we going to the moon?
09:22 That is certainly the million dollar question.
09:25 I would not be surprised if we see Bitcoin drop back down below $60,000 today or in the
09:31 next couple of days.
09:32 I mean, the support level at that point would probably be somewhere around, say, $57,000
09:41 ish.
09:43 As far as going to the moon and where this could certainly go, I mean, long term, I see
09:49 very bullish signs for Bitcoin.
09:51 Again, the halving is historically an extremely bullish sign, especially for the 12 to 18
09:56 months post halving.
09:57 So it's not necessarily something that will be reflected in prices right away, but probably
10:02 by the middle of next year.
10:04 And as we enter 2026, that's really kind of when this will take hold.
10:10 But at the same point, too, as I'm saying all this, Bitcoin could certainly skyrocket
10:14 upwards even more.
10:15 I mean, I would not be surprised if later today or later this week we see it past $69,000,
10:20 $70,000, set a new all time high.
10:23 I mean, it doesn't mean it's going to stay there, but I think it's just a function of
10:26 how the Bitcoin market is structured.
10:28 There's so much leverage.
10:29 I mean, people bet on these things with futures and options.
10:34 And if the market goes against certain bets, it could lead to liquidations or short squeezes.
10:40 And that could just create more buying pressure right away.
10:44 Those things can happen.
10:45 I could see Bitcoin go up.
10:46 But that also is why I think it could go down.
10:49 It's hard to make short term predictions.
10:50 But the long term, I'm starting to see a lot of predictions saying that Bitcoin is going
10:53 to by next year, at the end of the year, $100,000, $150,000, $250,000.
10:58 I don't think that those predictions are unreasonable.
11:02 But at the same point, that those aren't necessarily, those can't be seen as guarantees either.
11:07 Bitcoin is very much in price discovery phase.
11:10 And I would not be surprised to see additional big gains, even if we do see a couple of corrections
11:16 in the next couple of days or so.
11:17 Well, Steve, is there anything else on your radar that you believe should be on crypto
11:22 investors radars as well?
11:24 No, I mean, just the real thing that I would recommend investors consider.
11:33 Don't succumb to FOMO.
11:34 I mean, don't be afraid.
11:37 Don't put more money into crypto than you feel comfortable with, because this market
11:42 obviously can move violently in either direction or not.
11:46 I mean, really sit down with financial professionals, your investment advisor, think about the long
11:52 term thesis that you have for crypto, how that fits into your financial plans and make
11:57 a reasoned decision.
11:59 I don't, I have to check the price every day because it's my job.
12:03 It's yours too, Rosemary, but most people don't and shouldn't.
12:07 And just really, I know there's a lot of excitement right now.
12:10 A lot of people probably talking about it, but don't let that cloud your judgment on
12:15 whether or not you want to invest in the space or how much.
12:18 Well, thank you so much for joining me today, Steve.
12:21 All right, thanks, Rosemary.
12:22 Take care.
12:23 Bye bye.
12:23 Bye bye.
12:24 Bye bye.
12:24 Bye bye.
12:25 Bye bye.
12:25 Bye bye.
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