Co-founder of Apollo, Thomas Fahrer, downplays worries over Bitcoin's 2021 double top in market trends and emphasizes the rise in ETF demand, treasury allocations, and state-level Bitcoin reserves, heralding a new era.
In the evolving world of cryptocurrency, the co-founder of Apollo, Thomas Fahrer, offers a reassuring perspective on the current Bitcoin market cycle, dismissing concerns that draw parallels between the 2021 double top and the present-day scenario. Fahrer contends that the market dynamic in 2021 was marked by speculative leverage, questionable models such as the collapse of Luna, and off-exchange trading practices, in stark contrast to the current environment that is underpinned by robust institutional infrastructure.
Institutional-grade advancements like spot Bitcoin ETFs and treasury-level allocations have defined the present-day market, according to Fahrer. These developments have steered Bitcoin away from its speculative past, transforming it into a viable macro hedge for governments, corporations, and public pension funds.
A crucial factor that differentiates the present from 2021, Fahrer points out, is the "systematic ETF bid." In 2021, Bitcoin's surge was fueled by retail exuberance and the damaging effects of shadow leverage, as evident in the downfall of Terra Luna and the eventual bankruptcy of FTX. Conversely, today, asset managers like BlackRock, Fidelity, and others have launched Bitcoin ETFs, enabling direct Bitcoin purchases with verifiable on-chain demand and institutional-grade inflows.
Moreover, treasury allocations to Bitcoin have seen rapid increase, with public companies like MicroStrategy spearheading the change. This trend has since expanded to private firms and smaller-cap corporations, with global Bitcoin treasury reserves presently exceeding $11 billion. These developments emphasize a shift in the perception of Bitcoin – no longer viewed as a mere speculative asset but as a long-term store of value.
The rise in Bitcoin's recognition as a store of value has been further bolstered by interest from states and municipalities to employ Bitcoin as a sovereign reserve strategy. U.S. states such as Texas and Wyoming, and countries like El Salvador, Bhutan, and various European territories, have either introduced legislation or pilot programs, focusing on Bitcoin reserves as a part of their financial contingency plans. Governments are adopting this approach as a hedge against currency devaluation and the preservation of fiscal sovereignty in today's multipolar world. Fahrer asserts that the use of Bitcoin as a reserve asset reflects macroeconomic prudence rather than crypto enthusiasm, underscoring the stability missing from the 2021 speculative boom.
Fahrer believes that these factors contribute to a Bitcoin market that is structurally maturing, moving beyond the confines of previous, speculative cycles. With regulated ETF flows, corporate treasury involvement, and sovereign Bitcoin experimentation, the asset is less vulnerable to cyclical retail narratives, exhibiting firmer demand bases, diversified holding patterns, and resilient on-chain metrics. Fahrer describes the current Bitcoin market as entering its institutional era.
Looking ahead, the trajectory of Bitcoin ETFs may lead to the asset acting as digital collateral in global finance. Given the growing institutional interest and the potential for a U.S. digital asset framework prioritizing Bitcoin, Fahrer forecasts that Bitcoin could surpass $150,000 in this cycle, unlike the volatility seen in past parabolic blow-offs. As monetary systems continue to evolve and geopolitical tensions intensify, Bitcoin's decentralized, programmable characteristics make it uniquely positioned for the future, ensuring continued validation and integration into the global financial order.
- Thomas Fahrer, the co-founder of Apollo, suggests that Bitcoin's current market cycle is distinct from the one in 2021, as it is supported by institutional-grade advancements like spot Bitcoin ETFs and treasury-level allocations.
- Fahrer believes that the present Bitcoin market is underpinned by robust institutional infrastructure, steering Bitcoin away from its speculative past and transforming it into a viable macro hedge for governments, corporations, and public pension funds.
- One crucial difference between the present and 2021, as Fahrer explains, is the "systematic ETF bid." In 2021, Bitcoin's surge was fueled by retail exuberance and off-exchange trading practices, contrasting with direct Bitcoin purchases through Bitcoin ETFs today, enabled by asset managers like BlackRock, Fidelity, and others.
- The rise in Bitcoin's recognition as a store of value is evident in the increasing trend of treasury allocations to Bitcoin, with public companies like MicroStrategy spearheading the change. This trend has expanded to private firms and smaller-cap corporations, with global Bitcoin treasury reserves currently exceeding $11 billion, suggesting a shift in perception from viewing Bitcoin as a mere speculative asset to a long-term store of value.
