ARK founder Cathie Wood: very interested in stablecoin, DeFi and NFT

Cathie Wood, founder of ARK Investment Management, commented at the Consensus 2021 conference that the rise of Bitcoin is ongoing and it is impossible to bring it to a halt.

ARK founder Cathie Wood: very interested in stablecoin, DeFi and NFT

Cathie Wood, founder of ARK Investment Management, commented at Consensus 2021 on May 28th that the rise of Bitcoin is ongoing and it is impossible to stop it.

She argued that while Bitcoin has recently fallen sharply due to comments from Tesla CEO Elon Musk and pressure from the “ESG (environmental, social and governance) movement, regulators will become more friendly to cryptocurrencies over time. The U.S. has been confusing from a regulatory standpoint, but the new head of the SEC, Gary Gensler, will support open-mindedness.

She predicts that central banks will start buying cryptocurrency assets for their balance sheets. In the long run, Musk will have a positive effect on Bitcoin and improve its environmental image.

Prominent figures such as Lawrence Summers and Ray Dalio have recently warned that government and central bank spending could push up inflation this year. But Cathie Wood, known for her opposition to conventional wisdom, says deflation is more likely. She expects commodity prices to fall “significantly” and that technologies such as artificial intelligence and blockchain will help drive down the cost of doing business.

As time goes on, we think deflation is much more likely. I know most people think that’s crazy, given the current situation. But we’ve already seen some commodity prices fall. This in turn could lead some policymakers in emerging markets, and even the eurozone, to adopt hard currencies, including bitcoin. The “Bitcoin” market is a very important one.

In emerging markets, if commodity prices fall, the currencies of many emerging market countries will come under pressure,” she said. “I wouldn’t be surprised if some emerging market central banks start accumulating bitcoin …… because they know their currencies are depreciating and that they will be under attack as foreign exchange reserves fall.

Dalio told the Consensus conference this week that Bitcoin could become a victim of its own success, too successful that governments will try to ban it because it has become a competitive threat. But Cathie Wood said governments have recognized that innovation is the key to long-term growth, and that technology, whether it’s cryptocurrency or the Internet before it, can’t really be stopped.

“They’re all trying to say, ‘Let’s build a better regulatory footprint here so we can attract more innovation.’ I think that’s going to happen, or is already happening, in the cryptocurrency space,” she said.

Wood said she was “very pleased” to see Gary Gensler and Valerie A. Szczepanik as the new chairs of the Securities and Exchange Commission (sec). Gary Gensler is known to be open to cryptocurrencies, and Valerie A. Szczepanik is the head of the SEC’s Center for Innovation and Financial Technology Strategy.

Wood believes that Bitcoin has proven itself as a store of value and a way to prevent the confiscation of wealth. It has the potential to become a settlement network with the introduction of Layer2 solutions such as the Lightning Network, she says.

But Ark is increasingly focused on ethereum, having invested in the grayscale ethereum Trust and hired ethereum miners for its fintech analytics team.

We are interested in stablecoins, DeFi and NFT. We’re also very interested in the fact that developers are migrating (to ethereum) very quickly. I always say to our analysts, ‘Follow the developers and see what they’re doing. Because that’s a very clear signal,” Cathie Wood concluded.

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