Wall Street Crypto Trader Calls Bitcoin ‘Currency of the Internet’, ‘Digital Gold’, and ‘Reserve Currency’ of the Crypto Space

Siamak Masnavi

On Tuesday (10 July 2018), whilst appearing as a guest on CNBC's Fast Money, Bart Smith, Head of Digital Asset at Susquehanna International Group, one of the largest privately-held trading firms in the world, called Bitcoin (BTC) "Currency of the Internet", "Digital Gold", and "Reserve Currency" of the crypto space.

The segment featuring Bart Smith started with hedge fund manager Brian Kelly saying that "ultimately, Bitcoin is going, in my view, [to] be the money of the internet." 

Fast Money host Melissa Lee then turned to guest Bart Smith (saying that the show had given him the nickname "Wall Street's Crypto King"), and asked him to explain what was going with Bitcoin (which was trading at the time around $6,393). Smith said that if you looked back at how Bitcoin was doing back in late October, just before CME Group announced that it was going to launch Bitcoin futures before the end of 2017, you would find that it was trading in the $5800-6000 range.

bitcoin chart.jpg

"When the Bitcoin futures got announced, people got very excited about Bitcoin, about all these other tokens, these use cases—smart contracts, decentralized apps—and all of a sudden, you saw these smaller tokens, as people got excited about them, massively outperform, and we got way ahead of ourselves, and we got into late December, early January. We've been grinding back down here. We are back at the level we were before Bitcoin became a financial instrument. And so, if you are looking at these other cases... people are realizing those things are very difficult and aren't coming anytime soon."

He then pointed out that unlike the case with a lot of the altcoins, the use cases for Bitcoin remain valid today: 

"It is the currency of the internet. I would say it is a digital gold. It's a cross-border money transfer [tool]... 90-95% of the volume of crypto happens outside the United States. In the United States, we trade crypto for dollars. Outside the United States, for the most part, they trade other cryptoassets in Bitcoin. So, Bitcoin is the currency with which you trade other digital assets. It has become the reserve currency of crypto... I think there's a lot of people out there—BK [Brian Kelly] and I have talked to a lot of big investors—who would love to come in and buy it at $5000 if it gets there."

Smith was then asked, given the discounts available in the crypto market, if he was seeing increased interest from institutional investors. Smith replied:

"In our way of thinking, there are four pools of assets around the world: U.S. Retail, European Retail, Asian Retail, and... Global Institutional. There is really one player in the crypto space right now, and that's the Asian Retail... they are driving the bus... If one of those areas were to get tapped, like the institutional [investors], then it's a humongous flow of money, it will drive the price higher."

In an interview with The New York Times last month, Smith stated:

"We believe that this technology and this asset class is going to change some facet of financial services, and we think it is going to exist forever."

At press time, according to CryptoCompare, Bitcoin is trading around $6,343, down -3.98% in the past 24 hour period.

 

Featured Image Credit: Photo by "Worldspectrum" via Pexels; licensed under "CC0"