Kraken’s chief economist Thomas Perfumo provided deep insight into how Bitcoin is evolving and why it doesn’t fit properly in any box.
Talking to TheStreet’s Roundtable host Scott Melker, Perfumo pushed back the idea that Bitcoin would strictly trade either gold or tech stocks.
“Bitcoin actually only focused on the new history’s highest when the sect was portrayed by the Nasdaq,” Mercer pointed out, highlighting the unpredictable identity of assets in the current macro landscape.
Perfumo agreed that Bitcoin’s behavior is unique and shaped by the maturity of the adoption cycle. “If we see a price signal for an amount where gold prices are rising, there may be a change in the basis of supply and demand,” he said. “In Bitcoin, nothing has changed. The design itself is still the same. It’s consistent every day, year by year.”
That consistency, he explained, is why Bitcoin holds the basis for safe haven assets. “It’s predictable,” he said. “You can plan everything around it,” he added, however, that volatility stems from that location on the adoption curve.
“We’re talking about nearly 10-15% of the population (owning Bitcoin),” Perfumo said. “When you start growing it beyond 15% of the world’s population, you start to accelerate to that early majority… I think you have this kind of risk-on behavior.”
As recruitment grows, distribution and accessibility will grow through banks and brokerage companies. “In the long run, I think all the foundations and principles suggest that Bitcoin behaves like that digital gold safe haven,” he added. “But when we are experiencing that growth, it also behaves like a risk-on asset.”
Mercer summed it up. “We expect it to be very effective and as we mature, it will become less volatile and trade like gold or a safe haven.”
He also said Bitcoin’s volatility has already declined. “The Vols that have come to fruition are like 50%. Even in August last year… there were more of them in their 30s. In fact, it’s relatively very low for Bitcoin.”
With 95% of Bitcoin already mined and annual supply growth is only 0.8%, Perfumo believes the boom bust cycle will continue until adoption spreads.
Bitcoin (BTC) is currently trading at $93,957.46, showing a 1.4% decline over the last 24 hours per Kraken price supply.