Cathie Wood gives her viewpoint on Bitcoin ETF, Tesla and China in her latest business interview appearance.
“When Blackrock announced its filing for a Blackrock ETF the Bitcoin price did shoot up but has been fairly stable since then, so I do think it has had an impact,” she said.
Bitcoin dropped as low as $17,708 in June 2022 from an all-time high,where a year earlier, 2021, Bitcoin value exceeded over 65,000 USD in November 2021.
Bitcoin could still be maturing and too volatile to be classified as a safe haven asset. But it also has zero counterpart risk when the holder is in possession of the private key, which provides the digital asset safe haven features.
“When Blackrock announced its filing for a Blackrock ETF the Bitcoin price did shoot up but has been fairly stable since then, so I do think it has had an impact”
CATHIE WOOD
Bitcoin as a haven asset; Cathie Wood gives her viewpoint
The bigger impact this year was the regional bank crisis. It was very interesting to watch Bitcoin go from 19K to 30K USD right in the middle of that banking crisis as regional banks were going bankrupt.
So it was a flight to safety,” said Cathie Wood.
“Bitcoin serves as two kinds of hedges; one is a hedge against inflation and confiscation of wealth. The other is against counterparty risk. Our memories are afresh in 2008 and 2009 when counterparty risk became real. So there was this flight into Bitcoin, a completely decentralised transparent network, which is not subject to counterparty risk,” she said.
“If the SEC does approve a Bitcoin ETF, it will approve more than one. Most of these will essentially be the same, and it will come down to marketing communicating the message. We have been putting out a Bitcoin monthly letter during the last year and have started a Bitcoin brainstorming session,” added Cathie Wood.
Cathie Wood’s first one was launched in July.·So we are trying to get the word out there that our research is deep,” she said,
We have been doing it since 2015 when we gained our first exposure to GBTC. We were the first public asset manager to get exposure to Bitcoin.
Cathie Wood Ark filed with their partners 21 shares.
“Bitcoin serves as two kinds of hedges; one is a hedge against inflation and confiscation of wealth. The other is against counterparty risk”
CATHIE WOOD
SEC crypto overreach; Cathie Wood gives her viewpoint
“Well, I think that the two other branches of government, the judicial branch and the legislative branch are giving the SEC pause.
The SEC is losing cases in court. Bills are making their way through the House, seeing some bipartisan support,” she said.
“Gary Gensler last week said he was not the only one making this decision. There are five commissioners,” she said.
“Now, of course, we know they are weighting towards the Democrats, 3 Democrats and two Republicans.
One assumes the way Gary is voting is the way the SEC will vote, but he seemed to be distancing himself a bit from it.
So maybe we can take that as a bit of a clue,” she added.
“Coinbase is going to be the flight to safety exchange, no doubt about it”
– Cathie Wood
Cathie Wood’s Arkhas increased its position in Coinbase
“We think it is the most compliant regulatory exchange out there, and we are impressed by its derivative exchange in Bermuda. It is early days but a trusted partner,” she said.
Cathie Wood noted more turmoil out there with Tether and Binance. “There are rumblings out there that not is well,” she said.
“Coinbase is going to be the flight to safety exchange, no doubt about it,” she added.
She thinks the SEC will lose the Grayscale case.
How can you approve a Bitcoin future ETF and not a Bitcoin ETF?
“If you are concerned about consumer protection, a futures Bitcoin ETF is a swaps space. So there is counterparty risk there that you would not have with a Bitcoin ETF, which is backed one-to-one with Bitcoin in CoinBases cold storage,” she said.
She also noted that if there had been a Bitcoin ETF, many people would not have bought Bitcoin through FTX, the disgraced scam broker.
“Tesla is using Lithium iron phosphate and taking out the nickel and other metals that may end up getting in short supply, especially if we get into very strong cycles” – Cathie Wood
Cathie Wood gives her viewpoint on EVs
“We have a five-year investment time frame Horizon, and we think the cycle for autos will get tougher generally.
But we think just like last year when electric vehicles were up 69%, and gas-powered vehicles were down by 7% globally. We believe that we will continue to see that share shift accelerate because electric vehicle prices will follow their costs down in a way that gas-powered cars can not,” she said.
Cathie Wood believes electric vehicles will be less expensive than gas-powered vehicles, so they will keep chipping away at the auto market share.
“Even if the auto vehicle relapses, we don’t see that happening with electric vehicles,” she said.
She noted that Tesla is trying to engineer cobalt out of their EVs.
“They are doing it for two reasons: their supply is uncertain and focused in the Congo where there are a lot of environmental, governance and social concerns,” said Cathie Wood.
Lithium prices took a moon shot, 10X in 2 years, and now it is down by 40% from that peak.
Lithium is one of the most pervasive minerals, and we don’t think lithium is an issue at all.
“Tesla is using Lithium iron phosphate and taking out the nickel and other metals that may end up getting in short supply, especially if we get into very strong cycles,” she said.
She believes Lithium iron phosphate will lead to much lower price EVs.
Keep phosphate prices on your radar.
Cathie Wood gives her viewpoint on China
She thinks China is exporting deflation and believes the world could face a deflationary period.
“The government would be stimulating more aggressively if the Yuan were a little stronger. It has been weakening, and they are careful about their currency,” she said.
She doesn’t think they will be stimulating, as much as they would like or as many people would expect, because Yuan is showing fundamental weakness.
Cathie Wood’s ARk has relocated to Florida out of New York and has a hybrid setup working partly remotely and from offices.
