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- Bitcoin will rise in value regardless of who wins the US election, according to Jeff Dorman, chief investment officer at cryptocurrency hedge fund Arca.
- A series of positive headlines for Bitcoin last week lowered the fear factor for investors to enter the digital market, Dorman told Business Insider in an interview.
- “Most conservative people on Wall Street don’t want to be first and they don’t want to be last,” he said. “Once the right of way is established, I think it opens the door for everyone else.”
- While there isn’t a specific presidential candidate who will make a difference for Bitcoin, Joe Biden may be more supportive of the cryptocurrency in the long run, he said.
- Visit the Business Insider home page for more stories.
According to Jeff Dorman, chief investment officer at cryptocurrency hedge fund Arca, bitcoin and other risk assets are not dependent on who wins the US election as they will shake off market uncertainty regardless of the outcome.
“They just want to know there’s a winner,” Dorman told Business Insider in an interview Thursday.
He said that while the majority of investors expect elections suspended, or in which neither party has an absolute majority, it doesn’t matter who wins because all risk assets will see a huge rise.
In the long run, however, a Joe Biden win would be better for Bitcoin and gold because that would imply an unprecedented level of public spending, he said. “I’d say Democrats are better at inflation hedges, but as long as there’s a clear winner at some point, everything will go higher,” Dorman said.
Bitcoin rose more than 4% this week to $ 13,282 as of Friday, and up 80% year-to-date, putting the digital currency close to its June 2019 high of $ 13,880.
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It benefited from a favorable stock flow last week. PayPal said it will allow users to buy, sell and transfer Bitcoin, investor Paul Tudor Jones called it the “best inflation exchange”, and fintech firms including Square, Microstrategy and UK fintech Mode have revealed they have bought Bitcoin as part of their cash reserves.
Dorman, who has been in the wealth management industry for 17 years, said a billionaire investor like Tudor Jones investing in Bitcoin won’t necessarily ignite a bull market, but it has lowered the fear factor of entering the digital asset market.
“Most conservative people on Wall Street don’t want to be first and they don’t want to be last,” he said. “Once that precedent is established, I think it opens the door for everyone else. I don’t think that alone is enough to start a bullish cycle, but I think it is enough to increase the total addressable market in Bitcoin demand.”
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Dorman, who calls himself a Bitcoin bull, said fintech companies are revolutionizing the traditional financial sector, as they have the ability to move faster in offering services for digital assets.
“Look at the stock prices of traditional banks versus fintech this year and see how high PayPals and Squares and the like are doing versus JPMorgan and Bank of America,” he said. “It’s a huge deal. It’s a bigger negative for banks than positive for bitcoin, in the sense that you’re now offering an additional service that banks can’t provide,” he said of the potential of fintechs.
Dorman doesn’t think Bitcoin is a safe haven alternative to the US dollar, but said it could provide a hedge against inflation.
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