What's behind renewed investor interest in bitcoin

The US dollar (DX-Y.NYB) has fallen to its lowest level since 2023, prompting some investors to turn to bitcoin (BTC-USD). RYZE managing partner Matthew Graham joins to discuss the implications for cryptocurrency moving forward.

Graham cautions investors against "putting too much stock into that kind of trend analysis," dismissing such market analysis as a sort of financial "astrology." He emphasizes that macroeconomic factors are the primary drivers of bitcoin's price, a very notable risk-on asset.

Regarding spot bitcoin ETFs, Graham characterizes their launch as "overly positive" for crypto investors and calling them "one of the most successful" in years. However, he notes that the volume does not accurately convey investor interest.

For more expert insight and the latest market action, click here to watch this full episode of Asking for a Trend.

This post was written by Angel Smith

Video transcript

And with the dollar at its lowest level since 2023 fears are mounting the currency uh could fall further with some investors turning to Bitcoin.

Some analysts believe the boom to come could position the Cryptocurrency alongside a commodity like gold which hit a fresh all time high just this week.

And joining us now is Matthew Graham, managing partner of VC firm Rise.

Matthew, it's good to see you.

You know, it's interesting, Matthew in my inbox, one trend I've noticed is um folks sending emails, it, it's mostly technicians, it's chartists and they're interested in, in looking at gold and Bitcoin here.

And it is, it is true.

Matthew that since, since about late July, you've seen gold, it's up about 5%.

Bitcoin is down roughly about the same.

Matthew, what if anything do you make of that?

Sure.

So I would kind of caution putting too much stock into that kind of trend analysis.

I think technical analysis of that sort is basically astrology for men, but um I would phrase it uh like this macroeconomic factors are by far and away, the number one factors that drive Bitcoin's price but over any shorter period of time, they're gonna be a lot of other factors that are coming into play as well.

Golden Bitcoin are um the they fundamentally behave differently in terms in risk on environments.

Gold has been a store of value for hundreds if not thousands of years.

And the empirical evidence is pretty overwhelming at that at at this point that Bitcoin conversely is a risk on asset.

It's possible that in some kind of ex extreme edge case such as us dollar collapse, that that could result in a different price action from Bitcoin.

But ultimately, we're talking about a risk on asset and that's quite different from, from gold, which has been a store of value for so long.

A question I have about Bitcoin Matthew, I wanna get your take on this though.

Spot Bitcoin each Ts Matthew.

There, there was a lot of excitement, obviously early in the year.

Uh when those launched, um the idea, you know, it was gonna be everybody was gonna, gonna load up on those.

Is that what we've seen?

How would you grade the launch at least sort of initial reception here by investors?

Sure.

I would grade the launch as overwhelmingly positive.

It's one of the most successful ETF introductions class of ETF S, one of the most successful introductions in some years.

Overwhelmingly positive for Wall Street, overwhelmingly positive for anyone involved with the production of the ETF S. In practice, I think that some of the substantial part of the ETF volumes are driven by basis, people playing the basis trade, uh capturing that delta between spot and future.

And so I think the volumes can be a little bit misleading if you're trying to use those volumes to assess money inflows into Bitcoin themselves.

So as a product overwhelmingly successful, and I think that is bullish in terms of predicting Wall Street's interest and continuing to get involved with crypto on a going forward basis.

But you can't quite map it to influence in the way that it's tempting to do Matthew the Democratic National Convention taking place.

Uh Kamala Harris speaking tonight.

Uh I, I want to get your take on how important you think the US election is for crypto?

And are, are you surprised at all, Matthew at how, you know how much of an issue crypto has become in this campaign?

I think it's quite si think the election is quite significant for crypto.

Uh The fact remains that the Biden administration has been overwhelmingly hostile to crypto.

And so we are seeing signs that a Trump administration would be a big change from that.

I think there's a lot of caution to that as well because the Trump administration first time around was more neutral rather than positive towards crypto.

And I think that it's likely that President Trump is viewing it in more of an opportunistic fashion.

But still, even if a Trump administration were to be neutral rather than actively hostile.

That would be an enormous change from the last four years.

Um I don't think we can necessarily assume that a Harris administration would be a continuation of the Biden administration policies and there have been some comments and even some overtures to indicate that there is at least some possibility of a reset, but I think that needs substantially firmer evidence before we could really put any credence into it.

Fair enough.

Matthew, thanks so much for joining the show today.

Appreciate it.