Natalie Brunell, Hard Money host and Bitcoin educator, joins Yahoo Finance Live to discuss the crypto rout, bitcoin’s correlation to other assets, and strategies for long-term holders.
– Crypto market volatility continues to weigh on crypto exchanges and platforms, including Crypto.com. Now the company is said to have pulled out of a huge Champions League sponsorship deal at the last minute. Natalie Brunell, Hard Money Host and Bitcoin Educator, is with us to discuss this and more. Nathalie, thank you very much for joining us. So we know that whenever we have some kind of bad news regarding crypto, it tends to really weigh in on it. But crypto has really been under pressure so far this year. What are you keeping an eye on, especially regarding Crypto.com’s withdrawal from this partnership with UEFA?
Natalie Brunell: Yeah. Well, it’s a bear market, that’s right. We are in crypto winter. But I feel more bullish than ever on bitcoin especially because during this time I think these major efforts to really get education out there are really the most crucial right now when we see the system as a whole having these issues of liquidity. They are trying to raise interest rates. But we have so much debt in the system that we’re feeling pain everywhere, from crypto to stocks, with home sales slowing. And so I think it’s really important to educate people on the importance of the idea of hard money. And now we have it in digital format.
– Natalie, I want to hear from you because yesterday we were talking about bitcoin. We talk about it every day at Yahoo Finance. But Michael Kantrowitz, he’s a guest on Piper Sandler’s show yesterday. We asked him where he thinks Bitcoin is going, at least in the short term. Let’s play a quick clip from that interview. And then we will have your reaction.
MICHAEL KANTROWITZ: We posted many, many months ago that I think Bitcoin was around $40,000, that we’re likely to see it halving, and then more. And then we reiterated it recently. So I could easily see it dropping to $15,000. Again, this is not a long-term view of Bitcoin at all. It’s purely a cyclical view with the realization that it trades just like the market today. So until we see a bottom in the economy, I don’t think we will see a bottom in Bitcoin.
– So Natalie, I know you’re bullish on Bitcoin. The question I have for you, what will it take to build investor confidence and really see here a catalyst for the crypto market?
Natalie Brunell: Well, you know what, I largely agree with what he said because we have so much uncertainty with the system as a whole. And I don’t know if the bottom was with that 17,000 in June. And what we really need is just more education, because Bitcoin has been highly correlated with stocks. It has been the beneficiary of the last decade of quantitative easing. And that’s because a lot of people and a lot of institutional investors don’t even really understand Bitcoin. It is decentralization. And that’s the real rarity. And often it is bundled with other cryptos. So we are very, very ahead.
Now, because the price has come down, those are the prices people wanted to see when it was $69,000. They thought it was too expensive. They were doing FOMO. And they thought it was too late. So this is always a very good accumulation point because once you try to time the market and find a bottom, you will never be able to predict it. So, I’m the buying average. I feel optimistic in the long term. But I agree with what he said there could be more pain in the short term, because it’s part of this larger macro environment that’s very, very volatile right now.
– So, aside from macro headwinds, what do you think are the biggest pressures on crypto right now?
Natalie Brunell: Well, I think the wash selling happening right now is adding to the volatility because there are no wash selling rules with bitcoin. Some people use it to collect taxes. But others use it to trade and speculate. I am not someone who advocates Bitcoin trading. I see it as a long-term savings vehicle. So what I buy, I don’t plan on looking at, let alone touching, for at least five years. But others are there to trade. And they take advantage of the volatility. Some people say regulatory clarity will help. Others are very against regulation in this space. And they believe volatility will decrease as more people adopt Bitcoin and start using the Bitcoin network. But again, I think in the short term there will be more volatility. And for some people, that makes them a little wary.
– Well, Natalie, what do you think about regulation, right, because we have that aspect of fraud as well. There was a recent Forbes analysis of 157 crypto exchanges on trading platforms. They actually discovered that 51% of crypto transactions were fake. So, is regulation necessary? And if so, what do you think it should or could look like?
Natalie Brunell: Well, I think regulatory clarity will help institutions get on board. And I think it will provide more ramps. But at the end of the day, I think the regulations around bitcoin are already pretty clear in terms of it being recognized as a digital good and a digital commodity. That being said, I want to add that this broader space, crypto, is growing very, very quickly with companies and exchanges all over the world making it very, very challenging. This creates obstacles for US regulators.
I think a lot of regulators are still largely trying to understand the industry. They’re trying to figure out the companies, the big names that are both on and offshore, some of them offering these massive returns and other tokens that could pose big risks for investors, as we’ve seen in cryptographic contagion. And so I think that just shows the importance at the retail level of really knowing where you’re buying your Bitcoin from, who you’re buying it from, and the idea of educating yourself about self-custody, where you can become your own bank, take custody of your Bitcoin and maintain full control of your asset and investment.
– And at this point a lot of people wonder, they say it’s the person who holds the keys who really should be in charge of Bitcoin. So sometimes when you have things like a Binance or a Coinbase or whatever, you put yourself at risk. But I want to ask you about these US federal prosecutors asking Binance, the world’s largest cryptocurrency exchange, to provide some of these extensive internal money laundering records. When it’s the biggest exchange that gets this kind of scrutiny, how much does that hurt people’s adoption of Bitcoin in the future?
Natalie Brunell: Again, I don’t think it will harm him in the long run. I think, again, regulators are trying to understand the industry. And they try to get registrations from companies all over the world, which causes some problems. But it is this saying that we have in Bitcoin where a knife can be used by a surgeon, but also by a criminal. Look, money is going to be used for both good and bad, regardless of its format. And I think, overall, because we live in a digital world, we’re going to embrace digital cash soon. And bitcoin is hard money.