Anthony Scaramucci believes Bitcoin’s current bear market could be a sign of strength.
He has argued that the cryptocurrency has avoided the much deeper drawdowns that were typical for the previous bear market cycles.
During his conversation with CNBC’s Andrew Ross Sorkin from the SALT Conference’s Wyoming Blockchain Symposium, the SkyBridge Capital founder said Bitcoin remains in a “clear Bitcoin bear market.” However, the relatively modest decline could be seen as a reason to be optimistic.
“Again, 37 years doing this. Nine bear markets. This is a clear Bitcoin bear market,” Scaramucci said. “And yet we’ve only had a 55% drop in Bitcoin.”
He contrasted the current decline with previous Bitcoin bear markets. “In other bear markets, Andrew, you’ve gotten like a 75-80% drop,” Scaramucci said. “So, weirdly, you could take a position. Well, that’s actually a good sign that there’s a lot of net buyers going into the next bull phase of Bitcoin.”
Scaramucci’s comments come after Bitcoin suffered a prolonged period of subdued price action.
“It really hasn’t moved much at all,” Scaramucci said. “When the war started in February, it was roughly the same price that it is today. So it’s been grinding.”
The muted market activity has been attributed to several factors. Some Bitcoin miners have switched to artificial intelligence applications. “The second thing is capital fled the cryptocurrency markets, in addition to Bitcoin, other tokens in the cryptocurrency markets, into AI,” he said.
The third factor, according to Scaramucci, is Bitcoin’s traditional four-year cycle. He said Bitcoin is now approaching the stage of the cycle when the market would typically experience a bear phase, while the next halving remains roughly 18 or 19 months away.
“So we’re now through two years, and we’re about 18 or 19 months away from the next halving,” he said. “All of those factors, I think, have muted Bitcoin’s price.”
Scaramucci remains bullish
Despite the bearish market structure, Scaramucci remains bullish on Bitcoin’s longer-term prospects. He expects the next halving to tighten the cryptocurrency’s supply and eventually push its price back above the $100,000 level.
“I think as the halving cycle comes in again and we cut the supply of coins again, it will tighten price,” he said. “And I think you’ll see the thing move back up over 100,000. But it’s going to grind for a while.”
