Is Now the Right Time to Buy Bitcoin? | Mati Greenspan & Michaël van de Poppe


In times of crisis, all correlations go to
one. Quantitative easing, I expect that to be broadly bullish for Bitcoin. Liquidity
reigned supreme. One day, people will leave the dollar for all of commodities or older
assets. And that period will come in the next years. What’s up, YouTube, my name is Jackson. Today,
I’m joined by CEO and founder of Quantum Economics Mati Greenspan and trader Michaёl Van De
Poppe. How’s it going today, guys? Yeah, having fun. It’s going okay. Living with my parents, which I didn’t expect
to happen again. But it’s okay. Yeah, it’s different times for sure. So, yeah.
On March 23rd, Michael, you wrote an article for Cointelegraph identifying targets for
bullish and bearish scenarios. You said as long as 6,800-6,900 is not broken to the upside,
there’s more downside to be expected. How are the most recent market movements playing
into your bullish and bearish scenarios? I’m not really into news, as mostly news is
already priced into the markets. We have seen a huge surge on the equity markets yesterday
with the bill passing through that’s probably already priced in before it actually happened.
What I want to see with the price right now is just that we reclaim a previous support
level, which is 6,800-6,900. Until we don’t do that, I expect further downside to come.
It’s just pure technical levels. What is your take on Michael’s analysis, Mati?
What key levels are you looking at for bullish and bearish scenarios? I would say $6,800 is a key level that has
played out before, but you always got to watch out for things like false breakouts and things
which can happen. I would say overall, I mean, we’re looking
at a very wide range for Bitcoin, something between $3,100 and $20,000 per coin. So, you
know, please employee things like dollar cost averaging and buy the debt such as I’m doing
in my public portfolio. Continuing to look at the more short term
scenarios. Michael, you tweeted that the U.S. stock markets are currently in a relief or
dead cat bounce during a massive, massive downtrend. Both you and Mati have pointed
out how Bitcoin has recently been correlated with equities markets. Do you also believe
Bitcoin is experiencing a brief dead cat bounce as part of a larger downward trend? I guess it’s a little bit difficult for Bitcoin
to state it’s dead cat bounce. I still believe that Bitcoin has some sort of accumulation
period to come in the next few months, especially given the uncertainties on the equity markets.
You see it on all the markets. You see the equity markets bounce up pretty strong. Yesterday
you see gold and silver bounce up with tens of percents, but there’s no real shift in
momentum at this point. The first panic just occurred about the coronavirus, and there’s
still much more panic to come, I assume. So I expect the Bitcoin market to just accumulate
while the stock markets continue to fall down in the next months, given the economic impact
of the coronavirus as well. Do you share that same view, Mati? Yeah. So in times of crisis, all correlations
go to one meaning at the moment. What we’ve seen in the world, the initial
impact and the shock of the coronavirus is that people are moving to cash on an unprecedented
level, meaning that they’re selling off every asset that has a value. And that includes gold and silver, copper
stocks, of course. And Bitcoin now, especially since Wall Street
and institutional players are quite new in the market. I mean, most of them joined really
during the early 2019 rally. They were kind of like the first money, the
easy, the weak ends in the market. And a lot of them are the first ones to go out when
things started falling. That said, the correlation between Bitcoin and the stock market right
now is at a record high. It reached 0.6 out of 1, which is it’s never done that before. So at some point, that correlation has got
to come down. It can’t last forever and we will see a decoupling. What the United States government announced
yesterday is nothing short of helicopter money and universal banks, basic income. Over time
anyways, we’ll definitely see people starting to hold on to any kind of assets that have
by nature a limited supply. So continuing with this inflation, The Fed
was recently given the green light to print as much money as needed to stabilize the economy.
Mati, you took to Twitter to call this quantitative easing to infinity. Michael, you say long
term more dollars being created is bullish for Bitcoin and commodities. You’re both referring
to the effects of quantitative easing, how central banks are purposefully inflating their
economies to offset the financial crisis. Why is this bullish for Bitcoin? Michael? Well, what just Mati said about helicopter
money and inflation. In the end, people will seek to, people will search for assets that
remain their value in markets that are pretty inflative. So what you want to see at some
point is that investors run out of the dollar given the inflation or deflation, and start
to seek for other assets, which are commodities like gold, silver and platinum and Bitcoin.
The other scenario is that the crisis just continues to fall down until 2021-2022 and
the equity markets bottom out, after which the other commodity markets and Bitcoin start
to outperform the equity market. In the first case, which we have seen in 2009 to 2011 with
gold. So in the end, quantitative easing, I expect that to be bullish for Bitcoin. When can we expect Bitcoin to kind of fulfill
its destiny as you were talking about, Mati? What are the exact circumstances that you
see occurring when Bitcoin can finally come into the role that was meant for it? Unfortunately, past performance is not an
indication of future results. But if we look at the 2008 financial crisis, we know that
during 2008 when this stuff was hitting the fan and people were exiting stocks as fast
as they could, gold was going down as well. And this is very similar to what we’re seeing
today. It’s simply everybody’s kind of moving to
cash as the number one, not necessarily just cash, it’s anything that’s liquid. Liquidity reigned supreme in this scenario.
So everybody wants something that they can hold on to that’s liquid. If you look at that, the aftermath to the
financial crisis was I believe, as Michael said, 2009, 2011 and 2012, that’s when gold
really took this to the center stage. It was multi years, so it went from around
$800 after the crisis. And it’s shot up to $2,000 per ounce by 2011,
2012. But actually it was in response to quantitative
easing where people were afraid that quantitative easing would bring inflation. In the end,
it didn’t end up happening. That quantitative easing brought inflation. However, they’ve been printing money pretty
much constantly ever since then. And the amounts that they’re talking about now far surpass
anything we’ve ever seen before, which means that basically inflation is pretty much foregone
conclusion at this point, even if we haven’t seen it in the past, at some point you put
money, more and more money in people’s pockets. The number, you know, the number of work hours
are going down within the economy. The number of goods within the economy are going down.
That all adds up to us to a very clear picture of where we’re headed here. So what you’re saying is you kind of you’re
using gold as an example for what? For how Bitcoin could behave in the near future? I think yes. And I think that gold, again,
is already showing us incredible resilience since the beginning of year. I’d like to say if it went up or down during
the crisis, because it’s kind of been fluctuating, but it certainly hasn’t taken a hit like the
stocks have, it’s more or less held its value over that time. And I believe that Bitcoin
will also be seen as this type of asset. The first thing to happen to Bitcoin was the
weak ends left, which they often do when the going gets tough in Bitcoin. But the hodlers
remained. And I believe that they are increasing their positions as we speak. Michael, what’s your view on this comparison
with gold? Do you agree with Mati’s perspective? Yes. I mean, Bitcoin is actually called digital
gold. And it’s even, it’s acting in the same way as gold used to be in the past. However,
it’s easier to transfer Bitcoin than gold. So I expect Bitcoin to behave the same as
gold used to be after 2000 crisis as it also dropped down during the 2000 .com bubble,
a drop down in the 2008 credit crisis. So I expect the same to happen to Bitcoin and
crypto as it used to happen to gold and commodities. So either way, even if there has to be a decoupling,
people have to fly out of the dollar. That’s one way. The other way is that the equity
market just bottom out of this recession or crisis or whatever it’s going to be and start
to outperform the years after. That’s the main two scenarios that I’m watching for Bitcoin
as well. A draft of the U.S. coronavirus stimulus bill
proposed the creation of digital wallets to administer a universal basic income for adults
earning under $75,000 a year. Although this provision was removed in the most recent draft,
members of the House and the Senate are fighting for the implementation of digital dollars.
Michael, you tweeted that the U.S. announcing a digital dollar doesn’t change much. A digital
U.S. dollar is still a U.S. dollar. Why is Congress suddenly considering a digital dollar?
And what does this mean for crypto? And why don’t you think this changes anything? What it means for crypto is it raised awareness
through that it’s probably a blockchain application that’s built on blockchain. So in the end
we will go to to a digital future in which cash just goes away and everything goes to
a digital platform so that it is bullish for crypto and awareness for crypto and Bitcoin
in general. However, it’s still a dollar and it’s still an infinite quantitative easing. So that doesn’t change anything. There’s actually
printing more money while Bitcoin has their whole thing and the exact opposite of the
currency, the dollar. So I think in the long term, it’s bullish for Bitcoin. For short
term, okay, it’s still acting the same as the equity markets. I assume so. I guess they
need to have one opportunity to do the helicopter money. And this is one way of doing it in
the easiest way for the Congress to fulfill that prophecy. What are your thoughts on this
proposal, Mati? It was kind of off the wall lacky proposal,
wasn’t it? The fact that somebody in the U.S. government
is pushing for it is quite interesting. And we have seen former CFTC chairman Giancarlo. He’s basically quit his job and he’s lobbying
specifically only for this digital dollar. And I think the digital dollar would be, first
of all, good for the United States because they’d be able to have a much greater level
of control over their currency. Obviously, when you have bills that are floating
around you, you can’t always track them. You can’t always know where they are or what they’re
doing. So people are holding them in safe or they’re destroyed. You don’t really know.
Or maybe people are spending them. So when you have a digital dollar, you have
a very good level of control over the velocity of money and with the creation of money and
a very good oversight of what’s happening within your economy. It would be good for Bitcoin, of course, because
it advances the entire idea of the Internet of value where we have something where we
have dollars that are native to the Internet that are floating around. That only increases
awareness and usage of digital currency, which is going to be good for Bitcoin because Bitcoin
is the original digital currency in far preferred. If you look at it on paper, as far as you
know, supply and inflation and hard money and everything like that. That said, I believe that it’s not really
in Congress’s authority to create a digital dollar. I believe that really goes with the
Federal Reserve and they don’t seem to be in any rush to do this. It was kind of a sudden thing. But do you
think this is an opportune moment for the creation of a digital dollar? No, I think that they’ve got far bigger things
on the fact that it made it into that proposal. I think that would just chalk that up to the
ridiculousness of Congress and everybody trying to push their agenda. I don’t think that that was something that
there’s really bipartisan support for. Otherwise, it would have actually made it into the bill.
So I don’t know. I think that people just have their hands full with this coronavirus.
And maybe once the dust settles, that’ll be put on the agenda. But for now, it’s nowhere near it. The Quantum
Economics website advises people not to hold cash. In the current economic environment,
if you’re not investing you’re losing money. For many, the onset of a financial crisis
can seem a risky and daunting time to start investing, especially if they have a small
budget. Why is it important to be investing and trading at this point in time, even though
it looks like we’re headed toward a recession if we’re not already in one? So simply, like I mentioned before. Well, everything that we’ve seen so far from
this crisis is the initial shock and impact. So imagine the economy as a car that was zooming
along at 110 miles an hour and all of a sudden it stopped, whether it was in a car crash
or somebody slammed on the brakes we’ll leave that part of the analogy. But what’s happening
now is that the car is coming to almost a complete stop. Meaning that the car, the global
economy is not moving. And the idea of cash is going to be something
that you just don’t want to hold on to because it will lose its value and it’s been happening.
It’s been playing out when I wrote those words before the current crisis. But I believe that
that’s going to be far accelerated now. And if you’re in an extremely small budget, I
would say it doesn’t really matter all that much. If you’re going to be holding cash, if you’re
living paycheck to paycheck, then you don’t really have much to invest with. Anyways,
I wouldn’t say to start trying. That’s not necessarily always the brightest move, because
if you need that money, you know, this is an old idea in trading, if you need the money
for something else, you know, food, education, clothing, rent, you definitely don’t want
to be trading with it. That’s just a dangerous thing to do. But for anybody with a bit of
an extra or disposable income or value that they want to store or they want to see it
grow in the future, cash has not been a good place for that. Not since the 80s. And it
won’t be anytime soon. With negative interest rates and everything like that, you’re going
to want to do everything you can to find things that are of value and going to continue to
rise in value. Just cash is not a great place to store value
from now on. Michael, do you agree with this idea that
if you’re not investing, you’re actually losing money? I agree on some points right now. I mean, if the first shock on the equity markets
has just occurred. If there is not a second wave coming in through which the coronavirus
will take the all year, I expect the markets to just drop further down. But people have
to realize that the coming years will give you opportunities. You have been waiting for
all decade. So if you want to start investing and trading, then this is probably the period
that you want to make some choices. That doesn’t mean that you have to use all your money for
it or that you have to invest everything at one point. Dollar cost averaging is a pretty
decent way of investing in this period as it’s just giving you opportunities you’ve
been waiting for it’s the same as people who join crypto in 2017. They wanted to buy at
$3K, but then they didn’t have any money to buy Bitcoin at $3K because they bought it
at $18K. So if you are patient in this market, then just dollar cost average. You get opportunities
you’ve been waiting for years and I guess that’s tremendous. And one day people will
leave the dollar for all of commodities or other assets and that period will come in
the next year. So yeah, I agree on some point, but short term it’s a little bit too volatile
and uncertain to invest, I assume. What is one suggestion you would give our
viewers to protect themselves against the current downward trends in the market? At this point, I’ll just stay in cash and
be really patient. I mean, Trump just announced that they want to open up the country at Easter
while other countries are in lockdown for 3 months. So that’s an interesting approach,
I assume. And we have to see how that just works out. I mean, if the all country of the
states still has to get the first shockwave of coronavirus, then this whole impact will
just be bigger. So remaining patient is not a bad approach at this point. After that,
I’ll be most bullish on crypto and commodities in general, not particularly on equities. I’m going to disagree with you on that one. The Fed just announced that they’re willing
to buy the entire market. There’s enough cash in the financial system
and there is an infinite amount of cash at the Federal Reserve. We will do whatever we
need to do to make sure that there’s enough cash in the banking system. Like, quite honestly, QE infinity is okay.
If you’re willing to sell it, we’re willing to buy it. And this came at a time when there were literally
no buyers in the market for many assets, mortgage backed securities was just a sea of selling.
I’ve been getting alerts flashing for several days that there just simply are no buyers
out there for them. Bonds and the Fed also announced that they’re going into corporate
bonds, which are not exactly stocks, but basically they’re going to be holding up the value of
companies directly now as well. With that, basically and you know, along with
the stimulus package of 2 trillion dollars, I believe that they very well could have put
a limit on the downside of this market. And anybody who’s not investing right now
and sitting on on cash on the sidelines, probably to be missing out on the massive upswing. Great. Thank you, Mati and Michael, for joining
me today. It was a pleasure having you on the show. Thanks a lot for having us. Thanks a lot. Thank you, everyone, for watching. My name
is Jackson. That was Mati Greenspan and Michaёl van de Poppe. And guys, if you like the video
hit that like button and subscribe. And don’t forget to hodl.

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