Jordan Belfort Will HODL Bitcoin To $100k And Beyond

This past week it has looked like Summer 2021 is brightening a little for Bitcoin holders. According to Bloomberg data, Bitcoin has risen around 17% this week so far over $40,000 on Thursday, after positive comments from Elon Musk and rumors that Amazon may start accepting crypto payments.

Analysts from the Kraken exchange have described this as being a possible turning point to bring Bitcoin back into its upward trend and possibly reach new heights. 

A few days ago, we caught up with a famous investor and author, Jordan Belfort, “The Wolf of Wall Street”, and interviewed him about his thoughts on the Bitcoin doldrums of Summer 2021 and opportunities in the crypto market.

Jordan Belfort, “The Wolf of Wall Street”

What is your take on Bitcoin’s downward price movements over the past two months?

“It's very unsettling to track daily movements of such volatile assets. Incredibly volatile. If you buy Bitcoin, you have to buy it for the long term. You have to be a long-term player. I think most people, except the real professionals, will lose their shirts trying to trade for the short term. All the Bitcoin that I buy, I buy with a very, very long-term horizon, in the sense that I’ve got no intention of selling even at $100,000.”

“I'm betting that if it really breaks out, it's gonna break out massively, but there's still significant sovereign risk in there. When Bitcoin goes down like that, I think only the people that really don't understand are panicking. Nobody that really knows Bitcoin that's been in it for a while, can possibly be upset by a pullback. I was kind of happy because I was able to buy more.” 

Are a greater number of retail investors adding volatility to crypto the market?

“I wouldn't blame the retail investor. I think we have volatility in excess created by institutions and all the instruments that they create that allow for massive leverage. And I looked at Goldman Sachs for that. Your most volatility is if you take everything all the retail investors are doing, then it probably is like a tiny little drop in a bucket compared to what Goldman does on a leveraged basis…”

Do you have any interest in altcoins like Doge, Ripple, etc.?

“About Dogecoin I know absolutely zero. I think it's ridiculous. I don't know where it's going. Whenever Elon Musk tweets about it one day or not... I think that's dangerous and crazy.” 

“I think it's a very different situation than Bitcoin and Ethereum. There are other good coins out there. There's so many shit coins out there. The really sad thing is that the shit coins are giving crypto a bad name and the legitimate ones are really interesting.”

When will we see some Jordan Belfort NFT's?

“Listen, you know, I was just about to launch a whole bunch of NFT's. And then I said, You know, I don't want to be the guy that sold and made $5 million to $10 million, and everyone lost money on my NFTs because the market was struck with a crash. I already had my second chance, right? I don't think I'll get a third. So I have to be extra careful. So the answer is yes, I'm going to be selling, at some point, putting NFTs out there. But I'm going to really make sure the market is really ready for it as a stable market.”

Do you see bigger use cases for NFT beyond art and collectibles?

“100%. Art is the tip of the iceberg… I think 10% of the world's assets could probably be tokenized. And there’s a trillion dollars. There's a lot of stuff out there. And I think it's a nascent market. And I think that you're going to see it develop very, very quickly.”

What advice do you have for crypto investors?

“My advice is that if you're going to play in these ultra volatile instruments, whether it's Bitcoin or Ethereum, or meme stock, you have to be playing with money that you can afford to lose. You cannot look at it as if this is like your life savings, and you're betting the farm every day. Anyone who tells you they know what Bitcoin is going to do tomorrow is a f**king liar. I think it's generally going higher. But how do I know what the US government is going to decide tomorrow, or what laws are gonna come into place, or what Black Swan events are gonna happen. But I do have a sense that over the long term, you get it two to three years, it's going to be substantially higher.”

Not-so-dumb money and merging markets through tokenization

It seems at times that the crypto market is the shadow of the stock market, with crypto sometimes tracking in broad strokes in and out of sync with traditional markets.

With more retail investors moving into both crypto and traditional markets at a younger age than ever before, where is the opportunity in the emerging combined market of mainstream cryptos like Bitcoin and traditional finance? Will tokenization of traditional assets further merge these markets?

We presented a few questions to blockchain leaders and influencers.

When asked about market volatility in both crypto and traditional markets, Steve Braverman, President and CEO of Dignity Holdings, saw a common theme driving both.

"Simply put, fear and greed always control all investments. When stocks weaken, people sell to ‘protect’ their profits/principle. Traders love volatility. You rarely see large trading desks lose money in volatile markets. There are a lot of traders in both crypto and traditional markets," Braverman said.

"All assets will be tokenized in the next 10 years, which ultimately renders the correlation question moot."

David Packham, CEO of Chintai, a platform for tokenization and compliance management of traditional assets, sees the development of a new digital asset class as traditional securities are tokenized.

“As digital assets continue to develop out, we will see conventional securities become tokenized and embedded within the wider digital asset systems -- in effect they will integrate. Therefore different classes of digital assets will start to perform differently, such as tokenized real estate, commodities, and bonds; in the same way, different asset classes now operate on different cycles," he explained.

"We believe over the next 5yrs, we will see far less relevance to the "crypto cycle," which is largely dictated by Bitcoin itself as the dominant asset, and a rich widening of the digital asset ecosystem globally, which sees an integration and enhancement of traditional markets,” Packham said.
Paul Caldwell, CEO of Original Digital Corp, believes that we are seeing just the beginning of a movement that has already gained critical momentum. 

“Crypto is like the early internet – as big as it is, it is a fraction of its potential. People invested for years to a losing Amazon, knowing that as the internet grew, so did Amazon. The problem with crypto is that too few have too much, so it is prone to manipulation. But that is not stopping this juggernaut, and as regulators grow in scope, a safer market will grow even faster,” Caldwell said.

Benjamin Leff, COO of Sheesha Finance, pointed to the often reactive nature of crypto investors, but he believes that greater regulatory clarity will help grow the nascent industry. 

“Crypto is one giant global market that is impacted more by social media sentiment than technical analysis. We are still nascent, and this industry has a lot of room to grow before we start seeing more correlations. Once regulations are in place, it is a near-certainty that the correlations between markets will have increased,” Leff said.

Henrik Gebbing, Co-CEO and Co-Founder at Finoa, cites a new asset class developing through the tokenization of assets. 

“We will see the merging of both traditional assets (tokenized) and crypto assets on a new technology stack. Funds will need to upgrade either to new service providers, or their existing partners will have to upgrade. Ten years from now, any asset class will be digital and tokenized. There is no doubt,” Gebbing said.

Despite Belfort’s warnings to investors to play a long game, crypto investments seem particularly susceptible to sentiment. Kapil Rathi, CEO at CrossTower, believes that access to information is likely to create a larger base of more empowered investors. 

“Crypto has historically been driven by retail investors, and I expect this to remain the case for the foreseeable future. I think retail investors will continue to find the potential gains of both crypto and stocks appealing, but that we may see outsized interest in crypto as investors become more knowledgeable about the space and as crypto adoption broadens,” Rathi said.

Scott Melker, “The Wolf of All Streets,” supports the empowered retail investor, as does “The Wolf of Wall Street.” He believes a greater role by retail investors will help wrest some control away from institutional investors.

“Retail interest in markets was largely spurred by COVID -- the combination of lockdowns and stimulus checks, alongside influencers like Dave Portney, live trading were the perfect storm. This interest will likely increase with time, bringing more retail money in the market. This can serve to diminish the power of Wall Street institutions, which is good for everyone. We saw this with the GameStop saga,” Melker said.

Ben Armstrong, Founder of BitBoy Crypto, which was recently rated the influencer with the greatest reach, objected to our (intentionally incendiary) use of “dumb money” as a term. 

"I don’t like the term dumb money. That’s a term the suits came up with to make themselves feel better for not having a soul. The median age of retail investors is getting younger by the day; they are a hivemind of information, data analytics, irreverent passion, and memes. They want direct control of their money and their financial futures. They don’t trust the system. So yes, I see more and more regular people getting into both traditional and crypto markets. With that will come an increase in volatility, but that will even out in the years to come as bitcoin stabilizes its price,” Armstrong said.

“Dumb money is not the right word - it is hopeful money. The same people that are doing this more than likely took part in the Gamestop Gamma Short Squeeze and invested in ICOs and IPOs that were never designed to succeed. A lot of the “get rich quick” mentality is going away, and people are starting to learn to Do Your Own Research (DYOR). A greater number of retail investors may initially add instability to the market but not enough to do significant damage. In fact, most retail investors will see the error in their ways when they try to make quick money and start taking longer positions and strategies,” Leff said.

See also: How to Earn Interest on Bitcoin

Photo: Modified image by Nattanan Kanchanaprat from Pixabay