Investor Anthony Pompliano tried to convince Bitcoin users that volatility is neither good nor bad.
Speaking on CNBC Squawk Box, commented Pompliano in response to a question from host Joe Kernen about whether Bitcoin volatility is beneficial. Kernen asked if investors want stability to the extent that BTC is a usable asset, such as for payment purposes.
In short, Pompliano reshaped Kernen’s question to show the fallacy in measuring the leading cryptocurrency in dollars.
“One Bitcoin is still the same as one Bitcoin.”
There is no denying that Bitcoin is changeable
Answering Kernen’s question about the impact of volatility on usability, Pompliano he quickly mentioned that volatility is not in itself undesirable because liking depends on the position it occupies. And positions can and do change.
“Vatility is not good or bad, is it? Basically, volatility is bad only when it goes against you, so if you long for property and it falls, you don’t like volatility, if you long for property and it grows, you love volatility. ”
However, Pompliano acknowledged that Bitcoin, expressed in US dollars, has always been very volatile. He went on to point out a number of significant declines in the last two years.
“In the last two years, there have been two separate withdrawals of 50% +. There have been more than six 20% withdrawals this year +… ”
However, the problem here is that volatility is measured in dollars. And as a depreciating and highly volatile asset, using dollars to assess Bitcoin volatility is wrong.
Measuring in dollars is wrong
Part of the reason people ignore this is that dollars (or fiat in general) are always present in our daily lives.
“The dollar itself is also hyper volatile. We just don’t think about it because all the goods and services around us are valued in dollars. ”
Pompliano says things are getting worse given that 40% of existing dollars have been printed in the last 18-24 months. This means that the dollar has been losing value “at an incredible rate” since the health crisis began.
Article from Technology startups claims that 80% of all existing dollars have been printed since January 2020. Thus, it suggests that the devaluation of the currency is even worse than the situation depicted by Pompliano.
For the above reasons, the dollar is a poor denomination unit used to measure Bitcoin volatility.
When running his business, although prices of goods and services are rarely found in Bitcoins, Pompliano claims he is thinking about his purchases in BTC terms.
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