Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below.
Anchorage Digital’s head of research, David Lawant, believes the cryptocurrency market will continue to perform well this year; however, the three pending IPO’s from SpaceX, OpenAI, and Anthropic will likely have some impact on the crypto market given the size of their collective valuations.
“The amount of capital that we’re talking about here will probably suck air from a lot of the rooms. That’s another non-industry-related but also non-macro factor that I think is very important to watch,” Lawant told Benzinga in an interview.
Bitcoin Price Action
Bitcoin’s recent price action has largely been driven by institutional flows, shifting from treasury companies to ETFs over the last two months.
Don’t Miss:
Lawant identified three core drivers supporting Bitcoin’s positive trend: improving macro risk sentiment, light investor positioning, and growing industry fundamentals.
While Bitcoin’s volatility has been structurally lower amid recent geopolitical stress due to mechanical factors and market positioning, Lawant cautioned that this low-volatility environment is unlikely to persist indefinitely.
“I don’t think this is going to be the case forever, though. I would expect Bitcoin’s volatility to come back at some point, but it might take a while,” he said.
“Pretty much everyone who wanted to sell Bitcoin probably sold it by April,” he added.
Despite this, industry optimism is rising due to potential regulatory milestones like the market structure bill and increasing institutional interest in stablecoins and DeFi.
“The caliber of institutions that we are seeing engage with the industry right now is absolutely off the charts. Everybody’s seeing the long-term potential for crypto as a technology and in a big way, as an asset class too,” Lawant said.
Trending: Avoid the #1 Investing Mistake: How Your ‘Safe’ Holdings Could Be Costing You Big Time
Crypto Adoption In 401ks
When asked about how crypto adoption will play out in 401k plans, Lawant stated that he believes it will be a massive trend, but different from what the market saw with the early adoption of ETFs.
“ETFs opened a whole new client access to the asset class, but it happened basically all at once. A lot of them came out with billions of dollars right off the bat. On the 401k side, I think it’s going to be a much slower rollout,” he said.