The bitcoin downtrend has no doubt rocked investors to their core. This is evidenced by the decline of the Fear & Greed Index into the extreme fear territory, reaching as low as 11 on the scale. Investors, understandably, are wary of the market and what the next few weeks, and by extension, months, may hold for them. If this is the beginning of a bear market, then there could be another two-year wait to the next bull rally.
Anthony Scaramucci has however urged bitcoin investors not to despair during this time. Despite the market crash that sent the digital asset to six-month lows, Scaramucci, who is the CEO of Skybridge Capital, has told investors to look towards the long-term when investing in bitcoin.
The Bitcoin Crash Is Temporary
The CEO was on CNBC’s Squawk Box to talk about the crypto market. In this interview, Scaramucci shared some insight into how he viewed the market and the current crash, which he does not believe is a cause for alarm. He urged bitcoin buyers to take some time to cool off from the market, advising them to look toward long-term investing instead of what the market is doing right now.
Holding bitcoin for the long-term has always been the mantra of bitcoin maximalists, who believe more in the future of the digital asset than what it is doing in the present. Scaramucci has resonated with this in his latest advice. The CEO explained that bitcoin investors need to buy the digital asset for the long-term, as well as other cryptocurrencies which he expects to do well in the future.
BTC trading north of $37,000 | Source: BTCUSD on TradingView.com
Scaramucci pointed to the fact that a lot of investors say that they are invested in the long-term but yet are fazed by what happens in the short term. “Everyone is a long-term investor until you have short-term losses, and then you start freaking out,” said the CEO. “Take a chill pill, stay long bitcoin, other cryptocurrencies like Algorand and Ethereum, and I think you’re going to be very well-served long-term in those investments,” he advised investors.
Forget The Dollar, BTC Is BTC
Currently, the value of bitcoin is derived from how much it sells when compared to the dollar. This is how investors measure their holdings and how well they are doing in the market. However, Scaramucci rejects this idea of valuing bitcoin in terms of dollar figures and urges investors to just look at the digital asset for what it is; bitcoin. For the CEO, BTC is BTC and the dollar is the dollar.
He revealed that he tells clients of his investment firm SkyBridge Capital to invest in cryptocurrencies as long as they size it appropriately. “I don’t want my clients to miss this. I’m telling them to size it appropriately — that’s a 1% to 3% allocation, 1% to 4% at cost.” This is because the CEO believes that cryptocurrencies like bitcoin are inevitably going to be a part of the future.
Scaramucci also advised investors who get overly excited when they are investing in the market. He supports the idea of putting a small percentage of an investment portfolio into cryptocurrencies but cautioned against trying to lever digital assets like bitcoin due to its high volatility and the uncertainty that still clouds the digital asset. “It would be like levering Amazon back in 1998, ’99 and 2000,” the CEO warned.
Featured image from Vanity Fair, chart from TradingView.com