If there’s one constant in crypto, it’s volatility. Since Bitcoin first emerged in 2009, there have been euphoric upswings and catastrophic declines. Crypto bubbles lead to crypto collapses.
“Are we in a bubble or not? If I look at the overall slope over 15 years, I would say no,” said the Kraken executive. “If you look at it quarter by quarter, the answer is yes, we get into those bubbles all the time.”
Proponents say these companies let investors gain exposure to cryptocurrencies not readily accessible within their brokerage accounts, but detractors say these firms are a quick cash grab and will eventually collapse. There may already be signs of that collapse. Last week, the average drop in stock price of 15 digital asset treasuries tracked by Architect Partners, a crypto M&A advisory and financing firm, was 15%.
Still, on the same panel with Kraken co-CEO Sethi, billionaire Barry Silbert, founder of the crypto company Digital Currency Group, was optimistic. “There’s a whole lot of crap in crypto right now, which is overvalued. I think 99% of crypto is absolutely going to zero,” he said. “But that asset class, the crypto asset class, is absolutely not in a bubble right now.”
And if Bitcoin’s history of big drops and even bigger rebounds is any indication, Silbert may be right.
