Holpop News

Dan Morehead, CEO and founder of the venture-backed blockchain fund Pantera Capital, said digital assets will be the “best place” to store capital after the potential effects of a U.S. Federal Reserve (Fed) interest rate hike.
“I believe our markets are about to disconnect. Investors will think: bonds will collapse when the Fed goes from being the only buyer on planet Earth to becoming a seller. Rising rates will make stocks and real estate less attractive. So, where to invest when both stocks and bonds fall? (They usually have a negative correlation). Blockchain. It will become a legitimate place to invest in this world,” he said.
The entrepreneur noted that assets such as gold and cryptocurrency do not directly react to interest rate changes like bonds.
“Given that blockchain is not cash-flow oriented in the same way that gold is, it can behave very differently than interest-rate oriented products. I think when all is said and done, investors will be given a choice: they have to invest in something, and if rates go up, then blockchain will be the most attractive asset,” he concluded.
Morehead also added that while the cryptocurrency market has reacted negatively to the Fed’s recent actions, the value proposition of digital assets has remained the same. He explained that the decline in prices may have been due to the approaching end of the U.S. tax year.
“Imagine a trader actively buying and selling BTC, ETH, XRP, etc. Great year. Made a lot of money. Kept it all in the market. Last year’s capitalization growth was $1.4 trillion. That may have caused a noticeable portion of the recent sales,” he added.