Zinger Key Points
- Cathie Wood sees some connection between BTC and traditional tech stocks, noting its role as a risk-off and risk-on asset.
- She predicts that as institutional involvement in Bitcoin grows, correlations with traditional markets will rise.
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Ark Invest CEO Cathie Wood on Tuesday shared her insights on crypto regulations under President Trump and Bitcoin's BTC/USD evolving role in financial markets.
What Happened: Wood, a longtime Bitcoin bull, said in an interview with Bloomberg that she believes a Trump-led government would bring greater regulatory clarity and support for crypto across all branches of the U.S. government.
She contrasted this with the SEC under Gary Gensler, which prioritized retail investor protections but failed to recognize Bitcoin's emergence as a new asset class.
She also dismissed the notion of Bitcoin replacing the U.S. dollar, instead emphasizing coexistence.
The rise of stablecoins, backed by U.S. Treasury securities, will continue serving as on-ramps for decentralized finance, further solidifying crypto's place in global markets.
"Bitcoin is a completely different animal, though. Completely different," quoted Cathie Wood.
While she acknowledges Bitcoin’s place within the tech movement, she sees it as both a risk-on and risk-off asset. Bitcoin surged in Spring 2023 during the regional bank crisis, proving its hedge-like qualities.
Wood noted that while Bitcoin has some correlation to tech stocks, it's not as strong as the relationship between small-cap and large-cap equities. However, she expects correlations to increase as institutional investors continue adopting BTC.
Also Read: Cathie Wood Dismisses Trump Meme Coin, Remains Focused On Bitcoin, Ethereum, Solana
Why It Matters: Wood's comments come amid significant market shifts following DeepSeek’s AI breakthrough.
She highlighted how AI innovation costs are plummeting, with training costs declining 75% per year.
She predicted a shift away from mega-cap tech dominance, stating: "The most massive concentration in the market in history, worse than the depression, is probably going to give way to a broader-based bull market."
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