Cryptocurrency enthusiast Anthony Pompliano believes that it is a mistake to use the US dollar to assess the volatility of Bitcoin, since it is also “overly volatile.”
Anthony Pompliano said this in an interview during the Squawk Box program on CNBC. Program host Joe Kernen asked Pompliano if bitcoin’s volatility could prevent it from becoming a reliable vehicle for payments and settlements. Pompliano responded that many people have a misconception about the volatility of the first cryptocurrency, as they are used to measuring it in US dollars, which are printed “rampantly” by the government.
According to a cryptocurrency enthusiast, the dollar itself is also hypervolatile, but people don’t think about it, since all goods and services are priced in dollars. However, the effectiveness of this valuation method is diminishing: the US Federal Reserve (FRS) has printed 40% of the dollars in circulation in the last 18-24 months, Pompliano said. In his opinion, at such a rate, the US government devalues the state currency even more.
Pompliano admitted that bitcoin is very volatile compared to the dollar, noting that over the past two years, BTC has experienced two drops of almost 50%, and this year has demonstrated more than six “drawdowns” of the rate of 20%. At the same time, the bitcoin supporter believes that volatility cannot be unequivocally called a good or bad factor, since it depends on the position of the investor.
“Volatility is neither good nor bad. In fact, it only has negative consequences when it goes against you. If you open a long position on an asset, and it falls, you are unhappy with the volatility, and if your long position grows, you are happy with everything, ”said Pompliano.
He recently stated that in the future, cryptocurrencies will not be a separate industry, as, thanks to institutional investors, digital assets will penetrate all sectors of the economy.
