Yusko said, „Investors are long-term value-focused holders and speculators are short-term price-focused holders.
The motivation and time horizon for entering Bitcoin (BTC) will ultimately dictate whether investors are successful in this new asset class, according to cryptomoney pioneer Mark Yusko.
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On Friday, the CEO of Morgan Creek Capital Management commented on the recent wave of negative headlines about Bitcoin. In a series of tweets, Yusko said financial institutions have reason to be concerned about the disruptive impact of Bitcoin and will use whatever means they have to slow down its adoption.
The normal response to the Bitcoin threat is to „erect barriers to adoption and innovation,“ Yusko said, adding:
„When threatened, headlines always turn to the influence of governments to try to stop the adoption of new technologies through burdensome regulation.
Lately, this has been „a losing strategy for centuries,“ he said.
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Meanwhile, speculators looking for short-term exposure will continue to influence the price of Bitcoin by reacting to headlines. They’ve had plenty of negative news in recent days, with China confiscating $4.2 billion in cryptoactives and Brian Armstrong of Coinbase predicting potentially harmful regulations for Bitcoin.
However, he believes that investors with a long-term strategy are more likely to succeed as Bitcoin’s fundamental narrative strengthens:
„Investors are long-term, value-focused holders and speculators are short-term, price-focused holders.
Bitcoin holders are known for their low time preference, which means they defer immediate gratification for long-term gain. In this case, „long-term gain“ is a paradigm shift in society’s understanding of money.
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Bitcoin holders, or HODLers as they are popularly known, seem to have strengthened their conviction in the midst of the latest upward market trend. One example: 61% of Bitcoin’s supply has not moved in over a year even though BTC has been profitable for over 99% of its history.
In terms of price, Bitcoin peaked at $19,200 last week. In the process, BTC’s market capitalization shot up to USD 352 billion; a new all-time high. The asset price is currently below USD 17,000 after suffering a sharp correction on Thursday.