In a letter sent to Swan Bitcoin clients, John Haar, a former banker at American multinational investment bank Goldman Sachs shared his view of why people in traditional finance remain unwelcoming of the leading crypto asset. The former member of the traditional finance train (Wall Street) observed that there isn’t any reason, other than a poor understanding of Bitcoin, that has stymied Bitcoin adoption among investors accustomed to traditional finance products.
Characterizing Wall Street’s distrust of Bitcoin
Haar, now managing director of Private Client Services at Swan Bitcoin, stated he first got interested in the token back in 2018 when it was gaining hype in the traditional media. He worked for Goldman Sachs until April this year, when he switched to the crypto investment firm. The former banker revealed that there’s not one reason he’s found from traditional finance ‘maxis’ to explain why Bitcoin is shorthanded as a form of money.
Haar outlined six possible reasons to explain why there’s this much unattraction between Wall Street bankers and the largest digital asset. First, he cited the lack of adequate comprehension of the basics or history of money. Though Haar acknowledged that it’s a “daunting task” to begin learning and get to understand Bitcoin and its operation, those in legacy finance do themselves no favors as they cannot admit a lack of knowledge to begin with. Instead, they resort to regurgitating the rhetorics they spin off the media about Bitcoin.
He opined that the belief that government must be central to ensure stability and growth of an economy, their tendency to retain the status quo, and subscription to consensus rather than independence of thought are all reasons why traditional finance is generally unsupportive of Bitcoin. He acknowledged that none of this is “inherently bad,” but on the grand scale it prevents those in this space of finance from being open to adopting new technologies quickly enough
Kevin O’Leary says SWFs are snooping around Bitcoin, but regulatory hurdles hold them back
Despite seeing less adoption compared to other traditional assets, Bitcoin has still drawn the attention of several institutional investors. In a recent YouTube video, TV personality and entrepreneur Kevin O’Leary noted that several sovereign wealth funds (SWFs) are looking to jump into Bitcoin investment but are still wary due to the lack of a defined regulatory standard. He mentioned that he’s been in conversation with SWFs for several countries, including Norway, Saudi, and the UAE.
In the interview with Anthony Pompliano, O’Leary said he’s found that the SWFs of interested countries want to allocate 0.5 to 3% of their portfolios. He adds that “99% of them” are only floating the idea of Bitcoin as a potential digital asset investment opportunity. The Shark Tank investor explained that the demand is unique for Bitcoin, with the likes of Ethereum shunned for the still unfriendly gas fees. He added that SWFs might act on their interest in the token should it become the standard for altcoins.
O’Leary highlighted the lack of regulatory clarity as the only impeding factor to these SWFs getting into Bitcoin. He argued that were there straightened out policy for crypto right now, BTC’s price would skip to $60k in two weeks. The Canadian investor projected that these SWFs would certainly invest in Bitcoin once regulatory certainty is assured. He also noted that with their intent usually being long-term, their investment would be a bullish sign for the token.
Bitcoin price action
Bitcoin has sealed a revisit to 21,000 heading into the weekend. Bulls appeared to be running out of steam after failing to breach $25k fueled by last weekend’s rally.
BTC/USD trading chart
The flagship cryptocurrency briefly breached $25k, setting a 7-day high of $25,135 but has since seen consecutive lower daily closes eroding gains made over the recent weeks. Bitcoin was at the time of writing trading at $21,088 – down 7.41% on the day. The latest price volatility saw a 24-hr liquidation volume cross $500 million on Friday for the first time since July 18, when more than $700 million was wiped away.
To learn more visit our Investing in Bitcoin guide.
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