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Bitcoin price could double or triple in the next few years: Pantera CEO

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Pantera Capital CEO Dan Morehead joins Yahoo Finance Live to discuss outlook for Bitcoin ETFs and the long term price of crypto.

Video Transcript


BRIAN SOZZI: The crypto bulls are feeling nothing but good vibes into the weekend, as the space has lit up this week amid the launch of several, or a few, new Bitcoin-focused ETFs. So what's next for prices and the industry? For that, we're joined by Dan Morehead, Pantera Capital's founder, CEO, and co-chief investment officer.

Dan, good to see you again here. I really enjoyed your latest investor note. And you write right off the top that this could be a new price era for Bitcoin. So within that era, where do you see prices going?

DAN MOREHEAD: Yeah, so the Bitcoin market has had some fairly regular four-year cycles based on the four-year halvings, and that, in our opinion, concluded in April. We had a 55% bear market, and we started a new bull market in July. Bitcoin has had a compound annual growth rate of 233% for 11 years, so I can see Bitcoin doubling or tripling each in the next few years.

JULIE HYMAN: Dan, I know that folks within the Bitcoin world love to look at that four-year cycle and look at charts very closely. We talk about that with our Jared Blikre, who is our markets editor here as well. I'm curious, though-- from a fundamental perspective, what will account for those types of gains aside from just the desire for more market participants to get in on price appreciation?

DAN MOREHEAD: You know, it is as simple as supply and demand that every four years, they cut supply, and every two years, the number of people using Bitcoin has gone up 10x. And it's been doing that for 10 years. So the number of people using Bitcoin has gone up five orders of magnitude over 10 years, and the price of Bitcoin has gone up exactly 10x exactly every two years as well. That makes a ton of intuitive sense to me. And I can see a couple of years from now a billion people using Bitcoin and the price being, you know, in the hundreds of thousands for Bitcoin.

BRIAN CHEUNG: Hey, Dan, Brian Cheung here. So I wanted to ask about just the specific catalyst of this Bitcoin futures ETF. Obviously, that's been a big catalyst for the rise that we saw just this week.

But it seems like with that-- well, now we have the Valkyrie product coming out, but, really, it was just the ProShares ETF for the last few days-- that maybe all the money that's coming in here is not because it's the ProShares Bitcoin futures ETF, but it's all the optimism over a Bitcoin spot ETF coming out at one point, all these other types of products that can offer exposure coming out at some point. So what's the approach here when it comes to buying and selling on this type of news as we look forward to what might be the next steps when it comes to these types of products?

DAN MOREHEAD: Yeah, I think, you know, keeping it in context that these are just more ways, more convenient ways, to get people access to cryptocurrency. And so it just brings more people into the markets.

The thing to remember, though, is Bitcoin has been appreciating at a fairly steady rate for 11 years. A couple of things like a futures ETF, you know, give it a short-term pop. But in terms of the big picture, it's just every year, we see some new way. You know, last year, it was PayPal and Morgan Stanley going live, and now it's Bitcoin futures. There are just more and more vehicles to get people into the markets.

BRIAN SOZZI: Dan, within your framework for a double or a potential tripling in Bitcoin prices, what's your outlook for paper money?

DAN MOREHEAD: Yeah, so paper money is the one thing that is pretty clear. They are debasing it at such a rapid rate that it is depreciating relative to everything else. And you see prices of things like stocks, gold, all going up, Bitcoin cryptocurrency going up.

But if you also look, the price of everything else-- oil, copper, sugar, lumber-- they're all going up. Or another perspective would be, relative to each other, all of those fixed assets are, you know, somewhat stable, and it's the price of paper money that's going down.

JULIE HYMAN: Dan, you know, I think-- we talk to a lot of crypto people, and they always say the price is going to go up, pretty much, over the long term. Is there any risk to that view at all?

DAN MOREHEAD: Oh, there it is, and you've got to keep in mind that, although I think the price of Bitcoin's going to go up maybe 10x over the next 5 or 10 years, there will be some crazy bear markets. And we've had four bear markets in the Bitcoin history that averaged 68%. So investors really do need to have that view that don't put more money in than you could, you know, pleasantly endure a 60%, 70%, 80% bear market.

BRIAN SOZZI: You just raised a new fund this month, Dan. Where are you investing that money?

DAN MOREHEAD: Yeah, so our historical funds were a legacy of being the first to launch each of these types of things, like the first cryptocurrency fund or first venture fund. So we have four separate funds, and then this new fund is an all-in-one fund. It invests across the entire spectrum, from very liquid tokens like Bitcoin and Ethereum through to early-stage tokens that are not yet public, and then also venture equity. And I think it gives the best exposure to the space as a whole.

BRIAN SOZZI: All right, we'll leave it there. Dan Morehead, Pantera Capital's founder, CEO, and co-chief investment officer-- always good to see you. Have a great weekend.