On Tuesday (June 1), hedge fund manager and CNBC contributor Brian Kelly (aka “BK”) explained why he feels that the market is misplacing Bitcoin’s fundamentals and how this could lead to a big breakout to the upside.

According to his bio on the CNBC website, Kelly is the founder and CEO of BKCM LLC, an asset management firm focused on “global macro and currency investing, including investing in digital currencies.” Furthermore, he is the portfolio manager of the BKCM Digital Asset Fund and the REX BKCM Blockchain ETF.

Kelly is also the author of the book “The Bitcoin Big Bang: How Alternative Currencies Are About to Change the World” (which was published by Wiley in November 2014).

Kelly’s latest comments on Bitcoin were made during Tuesday’s episode of CNBC’s “Fast Money” at a time when Bitcoin was trading around $36,165.

Kelly seems to believe that Bitcoin has either bottomed already or very close to finding a bottom:

When you look at Bitcoin, it’s all about network effect and really about address growth. So, one of the key metrics that I look at when I’m managing crypto money is how fast addresses are growing versus what the market is expecting the addresses to grow. So, what we’re looking at right now in the charts that I brought along are address growth is basically flat but the market is inclined that we’re going to have a decline of almost 20% in address growth.

We haven’t seen that type of differential since March of 2020, and generally when Bitcoin gets that mispriced, it’s the sign of that bottoming process. And so, we look back to March of 2020, when we had a massive divergence; that’s when Bitcoin was $3,500, and it roared to $60,000. We’re looking at the exact same type of situation here where it looks like Bitcoin is trying to bottom. The market is mispricing what’s going on the fundamentals underlying Bitcoin.

He went on to say:

I personally added to our fund this month because I think it’s that big of an opportunity. In a fund, we are long and getting longer… Bitcoin is very momentum driven. So, now, we need to see some price follow through here and get that momentum going, but to me the story hasn’t changed one bit. We’re getting institutional adoption, we’re getting as an inflationary hedge, and regulatory-wise, we’re getting watered down regulation. It’s not going to be banned; we’re talking about bringing it into the fold. Those are all positive things for me and that to me is reflected in that misplacing.


The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.


Photo by “petre_barlea” via Pixabay