March 30, 2023

Skybridge Capital’s Anthony Scaramucci says bitcoin’s immaturity as a technological asset prevents it from being considered an inflation hedge.

Speaking on CNBC’s Squawk Box, Scaramucci said that bitcoin’s “wallet bandwidth” was still very low at 300 million, despite growing from 80 million wallets when he first invested. Until you get into billions or billion-plus wallets, Scaramucci told CNBC anchor Joe Kernen, bitcoin won’t become an inflation hedge.

Weighing in on the pedigree of gold as an inflation hedge, Scaramucci said In an interview with CNBC on November 12, 2021, he would never discount the precious metal’s 5,500-year history but that Bitcoin’s technical features are far superior. Its scarcity and the fact that it can be moved and stored very cheaply work in Bitcoin’s favor. Over an extended period, bitcoin will be “ten times better” than gold, he thinks.

Scaramucci says that bitcoin bull Michael Saylor and star investor Cathy Wood say that bitcoin will eventually outperform gold.

Not enough attention is paid to institutional investment

According to the hedge-fund billionaire, not much attention is paid to high-end firms like BlackRock and Goldman Sachs that are catalyzing institutional adoption of bitcoin.

BlackRock, the world’s largest wealth manager, recently tapped Coinbase to give its clients broader access to crypto assets. It also launched its first Spot Bitcoin product, a private trust that directly tracks the price of Bitcoin. According to BlackRock, institutional interest remains strong despite Bitcoin falling by nearly two-thirds from an all-time high of $69K in November 2021.

New partnerships willpower Enable BlackRock clients holding digital assets on Coinbase to use BlackRock’s investment software to assess the risk of potential investments.

The move comes somewhat ironically since CEO Larry Fink famously said in 2017 that Bitcoin was only valuable as a measure for money-laundering demand.

Other asset managers, such as UK investment groups Aberdeen and Charles Schwab, also Looking to enter the door. Abrdn recently bought a stake in crypto exchange Archax, while Schwab recently launched a crypto exchange-traded product.

SkyBridge pauses redemptions from crypto-linked funds

Scaramucci’s SkyBridge Capital pivoted to crypto about a year ago. It suffered crypto market headwinds in July 2022, announcing the suspension of withdrawals from its $200 million crypto-linked Legion Strategy Fund. Investors recently want to withdraw $890 million from its flagship fund, of which 22% was invested in cryptocurrencies by the end of June 2022.

Scaramucci is long-term and bullish on crypto said SkyBridge did not sell any of their Bitcoin positions until May 12, 2022, despite the collapse of the Terra USD stablecoin.

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