Speaker 1: This is Bloomberg Crypto, a daily Bloomberg I Heart podcast,
Speaker 1: and I'm Stacy Marie Ishmael, Managing editor of Crypto for
Speaker 1: Bloomberg News. It's Thursday, November ten. One of the things
Speaker 1: about the Bloomberg News room is we are very into data.
Speaker 1: As part of that, my colleagues on the Markets Live
Speaker 1: team do a weekly investors survey asking questions about different
Speaker 1: elements of financial markets. It's called the m Live Pulse
Speaker 1: Survey for the Markets Live team taking the pulse of
Speaker 1: financial markets in October, that team asked investors for their
Speaker 1: opinions about crypto. Obviously, Bloomberg Senior editor from Markets Kasha
Speaker 1: KLi Manschinska is part of the Markets Live team and
Speaker 1: responsible for these surveys. I think you know that retail
Speaker 1: and professional investors may be investing, and it's coming for
Speaker 1: different reasons. She joins me today. Along with Bloomberg reports
Speaker 1: of Vildana Harreck, crypto has been moving in the same
Speaker 1: way that stacks have been moving basically all year long.
Speaker 1: To talk about the crypto results, Kasha, Buldana, so good
Speaker 1: to have you on the show today. I feel like
Speaker 1: we just barely scraped out what certain types of traders
Speaker 1: were calling October right, this idea that October just about
Speaker 1: managed to end the month in crypto higher than where
Speaker 1: it started, and it was a bit of a slug,
Speaker 1: but but we got there. And one of the other
Speaker 1: things that we got to in October and Casha, I
Speaker 1: love your perspective on this is what I thought. It
Speaker 1: was a little bit of a surprising result from some
Speaker 1: investors that your team pulled about, you know, crypto market sentiment.
Speaker 1: Tell us a little bit more about what your findings
Speaker 1: were and where these findings came from. Yeah, thanks for asking.
Speaker 1: So my team halls very broad group of investors every week.
Speaker 1: So there are portfolio managers, sell side by side traders,
Speaker 1: even some executives, and of course retail investors. So every
Speaker 1: week we asked them about something different. You know, one
Speaker 1: time it's strong dollar, the other time it's treasuries, and
Speaker 1: then the meme stocks, and this time we asked about bitcoin.
Speaker 1: We found a lot of interesting things, but one of
Speaker 1: them was that they expect bitcoin to kind of stabilize
Speaker 1: in and trade in what you would say would be
Speaker 1: a narrow range come compared to where the bitcoin went
Speaker 1: over the past year, where it was all over the place, right,
Speaker 1: So now investors that are saying it will stay between
Speaker 1: eighteen thousand and twenty five thousand dollars, which is still
Speaker 1: a wider range than's treading out right now, where it's
Speaker 1: basically between like eighteen and twenty thou five hundred dollars, right,
Speaker 1: And then you can also argue that it's kind of
Speaker 1: a positive outlook. I mean, it is both downside and upside,
Speaker 1: but not to the extremes, right. I Mean, we did
Speaker 1: a similar survey a couple of months ago, and back
Speaker 1: then people were expecting BIT going to go to the
Speaker 1: ten thousand alaris or even lower. So this time you
Speaker 1: could argue that investors are actually more optimistic about the
Speaker 1: crypto asset Filana. What other signs of optimism are you
Speaker 1: seeing in the markets, whether in in folks that you're
Speaker 1: talking to, or just what you're seeing in fun flus
Speaker 1: or other areas. I like to focus on the macro pictures.
Speaker 1: So when I speak with investors, crypto investors, scripto strategy samalists,
Speaker 1: I always asked about what's going on with the economy
Speaker 1: with what they're seeing in terms of what the Federal
Speaker 1: Reserve is doing. Because we know that all of those
Speaker 1: actions by the FED in terms of them raising interest
Speaker 1: rates this year is really what's weighed on risky assets,
Speaker 1: including cryptocurrencies. So within the stock market, and this has
Speaker 1: happened so many times this year. I think something like
Speaker 1: five or six times we've seen stocks rallying because investors
Speaker 1: are expecting a so called pivot from the FED. Now
Speaker 1: that word actually means different things to different people. For some,
Speaker 1: it means that the FED is going to stop hiking
Speaker 1: interest rates. For others, it just means that they're going
Speaker 1: to be less aggressive. And we know crypto has been
Speaker 1: moving in the same way that stocks have been moving
Speaker 1: basically all year long, and so some are expecting that
Speaker 1: if we do see this FED pivot, whatever it may
Speaker 1: mean or whatever it may look like, that we could
Speaker 1: also have a turn and sentiment for cryptocurrencies. And Kasha,
Speaker 1: to Danna's point about the macro environments, one of the
Speaker 1: biggest macro themes that's been not just influencing crypto with
Speaker 1: driving crypto is regulation. What did the Market's Life Pulse
Speaker 1: survey have to say about regulation? Yeah, so I think
Speaker 1: we're quite surprised by this fine thing. So we ask
Speaker 1: investors if they think not only regulations, but also enforcement
Speaker 1: is positive forever. It will make them buy more invest
Speaker 1: more in crypto. And they said yes. So according to
Speaker 1: again this broad group of investors, some of them might
Speaker 1: be crypto enthusiasts, some of them might be skeptics, but
Speaker 1: they overall they seem to be saying, okay, taking Bitcoin
Speaker 1: and other cryptosis out of the so called wild West
Speaker 1: and into the main stream traditional investing, it's good for us.
Speaker 1: That's where we are willing to look into it and
Speaker 1: added to our postfolios. And when you say abroad group,
Speaker 1: you know, we had and it was more than five respondents.
Speaker 1: I think the exact number was five hundred and sixty four,
Speaker 1: and sixty percent of those respondents said that they thought
Speaker 1: the recent space of legal action, including enforcement, was positive
Speaker 1: for crypto. I was really interested in the breakdown between
Speaker 1: folks who identified themselves as like retail investors and professional
Speaker 1: investors on this question, because the retail investors said that,
Speaker 1: you know, sixty of the retail investors said they will
Speaker 1: be more likely to invest in crypto because of this
Speaker 1: grace enforcement, but only fifty six percent of the professional
Speaker 1: investors said the same, Which is I think that to
Speaker 1: me that that breakes me as unusual because a lot
Speaker 1: of the the rhetoric around we want regulatory clarity seems
Speaker 1: to have come from the institutional space. Do we have
Speaker 1: any theories as to why we had the split between
Speaker 1: retail and professional on this question? Oh sure, yeah, And
Speaker 1: I think Bill Dana can probably talk about it a
Speaker 1: little bit as well. But I think you know that
Speaker 1: retail and professional investors maybe investing in bitcoin for different reasons, right,
Speaker 1: I mean, I think for some retail investors is making
Speaker 1: some kind of a statement being independent from the mainstream
Speaker 1: financial system, whereas for professional investors, I think it's going
Speaker 1: another Crypto assets might have a little bit of a
Speaker 1: diversification element to them. And again I think Bill Dana
Speaker 1: has already mentioned that a little bit that B's going
Speaker 1: so far this year has been moving in tandem with
Speaker 1: some other financial assets, which I think for some professional
Speaker 1: investors might actually be a negative. Right. They were looking
Speaker 1: for something that will be moving in a different way.
Speaker 1: So if the entire market is impacted by the FED,
Speaker 1: they want to have something in their portfolio that will,
Speaker 1: you know, not go down with the other assets or
Speaker 1: not go up, And they may be thought that bitcoin
Speaker 1: would play that role. But again, so far this year,
Speaker 1: it seems that know that unfortunately bitcoin is kind of
Speaker 1: you know, joining the race with with with other assets,
Speaker 1: and that might just not be as attractive for some.
Speaker 1: And if I can just add a little bit to this,
Speaker 1: I also love the quote that we had in the story,
Speaker 1: mostly because I got this quote, but also because it's
Speaker 1: really good and it's that the more regulators can get
Speaker 1: crypto out of the wild West, that's the key phrase,
Speaker 1: and into traditional investing, the better off it's going to be.
Speaker 1: And I think when we've talked about this on this
Speaker 1: podcast before, where there's this sort of never ending hope,
Speaker 1: there's never ending optimism within the crypto space, especially on
Speaker 1: the part of retail investors, where the feature is always
Speaker 1: going to be bright if you are a sort of
Speaker 1: true believer in the space. So that's I think part
Speaker 1: of it. But the other part not to to tamp
Speaker 1: down on the party too much. But I think there's
Speaker 1: a difference between people saying that they'd be interested in
Speaker 1: the space if there's greater regulation and actually them waiting
Speaker 1: into the space were we to see greater enforcement. I'm
Speaker 1: reminded of an editor who used to say that you know,
Speaker 1: the best survey of market sentiments is the prices themselves,
Speaker 1: and they've been quote unquote boring recently. Bitcoin is boring well.
Speaker 1: According to one of the questions in the survey. We
Speaker 1: also ask people like, what what's one word you think
Speaker 1: of when we say bitcoin and with a like lovely
Speaker 1: little word cloud And there were a few that were
Speaker 1: all roughly the same size and they were bubble, volatile, future,
Speaker 1: ponzi and scam. So I mean, despite the shall we say,
Speaker 1: measured enthusiasm about the possibility of investing more, it seems
Speaker 1: that there's also a degree of concern about the robustness
Speaker 1: of this ecosi them and Filana. One of the things
Speaker 1: that we started to observe, in addition to a d
Speaker 1: percent increase in the price of Devote over the past
Speaker 1: couple of days, is as bitcoin is both you know,
Speaker 1: quote unquote boring, but also other elements in crypto. The
Speaker 1: more the bigger and more traditional tokens are providing less
Speaker 1: and less of a hedge, we are starting to see
Speaker 1: people look for alpha elsewhere, right, and in some cases
Speaker 1: that might be the meme coins. In some cases it
Speaker 1: might be defy. Do you think we're at a point
Speaker 1: in crypto where folks start to chase like yields at
Speaker 1: any costs, no matter the risk profile. I'm not sure
Speaker 1: because so I've been talking to people about this recently
Speaker 1: because bitcoin has been so quote unquote boring. So the
Speaker 1: question is whereas over the last couple of years, you
Speaker 1: could implement any number of wild trading strategies and you
Speaker 1: could go there if you are a super high risk,
Speaker 1: high adrenaline person, you could wait into the space and
Speaker 1: actually make a lot of money very quickly if you
Speaker 1: knew what you were doing, if you knew how to
Speaker 1: trade some of these these strategies. And so now the
Speaker 1: question is what are people doing if volatility has come
Speaker 1: way down where you have comparisons to the stock market
Speaker 1: and on some days you have Bitcoin just like wavering
Speaker 1: around a certain level and stocks just going like nuts
Speaker 1: all the time. And you see a lot of people
Speaker 1: making that comparison and saying, well, crypto is now less volatile.
Speaker 1: And then also we just have not really had a
Speaker 1: catalyst that's helped prices breakout upwards. We had an announcement
Speaker 1: from black Rock where they had a partnership with coin
Speaker 1: coin base, the crypto exchange, and prices basically did nothing.
Speaker 1: So even this huge, huge announcement wasn't able to shake
Speaker 1: things out of the sort of dul drums that that
Speaker 1: we've seen. So I have been asking people like, how
Speaker 1: are you making money now? Some are, you know, utilizing
Speaker 1: sort of sort of traditional strategies where and they see
Speaker 1: bitcoin prices go down, they waited in and they buy
Speaker 1: around seventeen or eighteen thousand. But then also you have
Speaker 1: people implementing like different options strategies and for some that's working,
Speaker 1: and and there are other strategies like marketing initial strategies,
Speaker 1: these like weird wonky things that people out there just
Speaker 1: looking to find ways to to make things a bit
Speaker 1: more exciting. We'll be right back with more from Bloomberg
Speaker 1: Reports of Aldonna Harrick and senior editor from Markets, Kasha Klimasenska. Kasha,
Speaker 1: going back to the word bubble, right, going back to
Speaker 1: the word bubble, you know, risk was there about the
Speaker 1: same size as the word value. And the way that
Speaker 1: word clouds or word bubbles work is you know, you
Speaker 1: kind of like match the size of the thing to
Speaker 1: the number of responses. But one of the ones that
Speaker 1: was kind of still up there was gambling. So it
Speaker 1: does seem like there's still a perception, especially among institutional investors,
Speaker 1: that even if the volatility is reduced, the risk profile
Speaker 1: of crypto overall is still high. Do you do you
Speaker 1: think that's a fair characterization of the findings. I mean,
Speaker 1: that's kind of what we were trying to find out
Speaker 1: with this fall, and I actually going out of it.
Speaker 1: I'm not sure I got the answer because you know, yeah,
Speaker 1: the gambling is there, but again, you know, it's also
Speaker 1: a palsy and future. I think it's kind of you know,
Speaker 1: gambling is still award that is associated with it's going
Speaker 1: but um, and I can't feel then I might have
Speaker 1: a different opinion opinion, but I think it has been
Speaker 1: gradually going away over the last year, and the more
Speaker 1: there's regulation and putting crypto into the main stream that
Speaker 1: the more the gambling aspect will will go away. Right.
Speaker 1: But it's also I think because this year overall, I mean,
Speaker 1: correct me if I'm wrong, but I think this is
Speaker 1: the year of risk off right and going with the safest.
Speaker 1: I mean, the best bad you could have made this
Speaker 1: year would have been too bet on the dollar, and
Speaker 1: you know, imagine that. Ask my grandma and she would
Speaker 1: have told you that it's not a risky that at all.
Speaker 1: So I think I guess that's a question that we
Speaker 1: have to ask again three months from now and we'll
Speaker 1: see what people say. Indeed, Um, two other questions that
Speaker 1: you did ask in the survey were around the flippening,
Speaker 1: which is frankly, let's be clear, this is a terrible word,
Speaker 1: but what that word refers to is the idea that ether,
Speaker 1: which is the second largest token by market value, could
Speaker 1: overtake Bitcoin. And you know, I think it's like only
Speaker 1: a third of those polled in the surveys that they
Speaker 1: think the flippening could happen in the next two years,
Speaker 1: which is about the same that folks got in July.
Speaker 1: And you know, you there was also this lovely quote
Speaker 1: in the story did you get this one as well?
Speaker 1: Build on a possibly for sure um from Victoria Green
Speaker 1: of the Squared Private Wealth, which said, it's almost like
Speaker 1: a religion. If you believe, you will always believe, no
Speaker 1: matter the price or the headwinds. And cash is just
Speaker 1: on that note, a question for you, are there any
Speaker 1: other asset classes that you or the folks on Markets
Speaker 1: Life cover that have this like similar grounding and belief
Speaker 1: rather than say fundamentals. Oh yeah, that's a good question.
Speaker 1: I would say probably not. I mean, you know, most
Speaker 1: of the faults that we talked to every day, they
Speaker 1: do look at fundamentals and data all the time, right,
Speaker 1: That's that's all They live in the world of excels
Speaker 1: and spreadsheets. But yeah, I would definitely give it to Bitcoin.
Speaker 1: They they built quite a brand. Um. Nothing seems to
Speaker 1: be able to take it away, even this boring range
Speaker 1: that it is trading in right now. And that's also
Speaker 1: why you have where it's like flippening in October and
Speaker 1: all these different memes, and it's basically like everybody has
Speaker 1: their own lexicon within the space because it's a little
Speaker 1: tight knit community and they speak with one another, and
Speaker 1: then you have these words sort of crop up or
Speaker 1: or be sort of made out of thin air, right,
Speaker 1: and because it's a way of identifying that you're part
Speaker 1: of the in group. Terrific. Well, Casha, maybe we will
Speaker 1: see you in three months, I hope. So all right,
Speaker 1: thank you for being on. Appreciate you both, Thank you,
Speaker 1: Thank you. You can find more of their reporting on
Speaker 1: the Bloomberg Terminal, on Bloomberg dot com and on Twitter.
Speaker 1: Vildonna is at Vildonna Harrick. That's v I L D
Speaker 1: E N A H A g R I C. And
Speaker 1: Kasha is k Klimashinska. That's the letter K and then
Speaker 1: K L I M A s I N S k Hi.
Speaker 1: It's Dusta and the Bloomberg Crypto podcast team. It's been
Speaker 1: a dramatic week in crypto with the sudden troubles of
Speaker 1: sand Bankman Freed's ftx dot Com prompting a bailout offer
Speaker 1: from its biggest rival, Binance Holdings, only for the deal
Speaker 1: to fall through. We'll have the latest on the deal
Speaker 1: that wasn't and what it means for investors on the
Speaker 1: next This week in Crypto, This is Bloomberg Crypto, a
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Speaker 1: at Crypto. The supervising producer of Bloomberg Crypto is Vicky Verglina.
Speaker 1: Our senior producer is Janet Babin. Our producers are Mohammed
Speaker 1: Faruk and Sharon Barriro. Our associate producers are Ty Butler
Speaker 1: and Moses on Them. Desta wonder At is our engineer.
Speaker 1: Original music by Leo Sidran. I'm Stacy Marie Schmal We'll
Speaker 1: be back tomorrow.