YouSaid · the spoken record

James Butterfill

lines on the record: 60
first: 2021-12-07
most recent: 2021-12-07
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Yeah, actually, I do have a view on Filecoin. I quite like the idea. There are sort of some other coins that I have absolutely no, for instance, I should know Axie Infinity a lot better than I do, but I don't. And it's something that's on the list of things to know a lot more about. Play to earn, I think, is a very interesting theme. Just what's happened to X infinity, I think, could happen in other places.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“The media sector, all these different spaces sought to break it down into groups and then start to learn a little bit about all of those and which coins perhaps represent that kind of theme the best. That's probably the best way to do it because it's becoming so complex, such a big space. You can easily feel like a little bit like a rabbit in the headlights. I mean, sometimes I get clients asking me questions about some random coin that's like number 100. I genuinely probably have no clue about it, but I don't think there's anything wrong in admitting that.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“It's knowing what to kind of pick and know what's important. It's just the complexity of the whole crypto space is just exploding. There's so many different ways you can go. And I think actually core knowledge of understanding Bitcoin will help you understand so many other protocols. That to me is the first place to start. And then something like Ethereum or Solana, which are kind of this world computer theme. I think tackle it by themes. Look at particular things such as the supply chain theme. Who's operating in that space? Is it something that's genuinely compelling? I mean, so for me as an investor, for instance, now if I was to create my own portfolio, how would I structure it? I think I'd break it down into these different sectors, how it transforms banking, how Web 3.0 transforms ad revenue models, how it transforms the”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“I don't know if it would look like me is I don't think I'm quite as wealthy as many people in the industry. Knowledge. I think Just plug a word at it and realize and lies and lies. I mean, there are still huge holes in my knowledge, which obviously I won't dive.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“New model for a lot of websites like Facebook, etc. So I think Web 3.0 is going to hugely transform this whole industry. You know, if this is why Facebook's so desperate to have its own token, because if it doesn't, then it's kind of, it's not going to exist in five to ten years time. So that whole token space for Web 3.0 is going to become massive.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, that's true. I think that brings me up, that's actually totally changing the subject. Well, no, it's not. It's related, but Web 3.0, I think, is going to be massive. And we've seen an indication of it. You talked about smartphones. So Apple and the iOS 15 released a lot more data protection features, which essentially mean that things like if you look at snaps results, they blamed there was a big decline in versus expectations in terms of its earnings results, and they blamed specifically the iOS upgrade. Now, that is like a precursor to what Web 3.0 is going to be. This is taking the control out of the marketers and the retailers owning your identity. You will be able to own your identity. And I think that's going to create a massive shakeup in the aver revenue.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Perhaps like in five years' time some of the existing top 10 or top 20 coins will be much bigger in size. I'm sure there'll be some real surprises that we didn't know about. But I think the incumbents now are starting to really establish themselves. And it's also, you know, I think, particularly in a proof of work coin, you can't just flip from one technology to another. In a proof of work, there's a lot of vested interest in that proof of work. And so it's hard for people. We won't see the smartphone moment, you know, where people just suddenly all start buying smartphones. I think it's hard to move from one proof of work coin to another as a miner in particular because you've invested so much in that one particular coin.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Clearly, know there's a lot of activity going on in these spaces. A lot of people are using it. And that's perhaps why, for instance, Solana's been popular. But the dev count drops off very quickly after the top 10 coins. And so I do think there'll be a lot of attrition. People will start to get an idea of what the big themes are. So I think these sectors, digital asset sectors will become a lot more defined. It's only now very early days that we're seeing, for instance, in the digital music rights space that we're starting to see blockchain technology take off. I think it will start to pervade lots of different sectors around the world, such as supply chain, enterprise, all these different areas and stores of value, et cetera. We'll see all these different areas become much more defined in the space. But I do think we'll see people start to magnate towards the better coins.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, there are so many projects right now and people are looking for that next 100x. I see it tweeted, the next 100x coin. I do actually think they'll be quite, in the next five years there'll be quite a lot of attrition. There'll be quite a lot, a big sort of shakeout of those kinds which after a while investors will get fed up with and say, well, they're not really delivering on it. It hasn't really captured the kind of imagination. I mean, I'm not by any means a Bitcoin maximalist. I think in a perfect world like Bitcoin could do everything, but the world's not perfect. And in fact, Ethereum's got sold on a march on Bitcoin in terms of some of all the additional smart contracting that it can do that's actually very difficult to do on Bitcoin. And I'm a firm believer of the dev accounts, developer counts in these places when you have high developer accounts.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“A Picasso, for instance, but clearly there are people that will, and I think it's the same in the NFT spaces, you know, the price has gone very high, but there were clearly people that will. And you only have to look at OpenSea to see its revenues. I think there were two and a half billion in September and 2.1 billion in October to show there's a huge amount of appetite for this in this space. I think there's a lot of kind of rubbish in the NFT space. But again, this is subjective, right? People like what they are. I own some NFTs that I think are quite nice. I'm sure some people might think they're rubbish, but I own Ether Lambeau, for instance.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Actually, really well known artists get into this space. And I think that's an area that could really do well. Now, obviously, crypto punks, and there's some frosty areas in the market. Axi Infinity is amazing what's happening there. There's a whole kind of macroeconomic ecosystem created in the Philippines because of this. Going to places like Venezuela as well, where people are making secondary income. I do worry a little bit about that because it seems a bit frothy. I think the whole concept behind NFTs, it works from an art perspective. It also comes down to this subjectivity of Bitcoin too, because a lot of people say Bitcoin has no intrinsic value, but I think it's a bit like gold. Actually, what has intrinsic value is incredibly subjective. And in the NFT space, that's exactly the same. I personally would not pay $40 million for...”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“already saying visa buy nfts you know i i really like the concept of nfts i think it it's epitomizes what bitcoin and just ledger technology is all about you know essentially what bitcoin invented it was like the first thing you couldn't copy and paste on the internet and the first time i heard about nfts i was like this is weird this is like an image i can just send anyone an image but what it really represents is the digital provenance of that image and it bakes in you know a kind of fee that the artist gets every time it trades on these on the secondary market i think that's that's brilliant in respect it's got that perfect provenance and so i really can get why so many people are moving into the nft space now i think an area the nft world that's not been exploited at all is real world artists getting into the nfts now we see damian hurst but not many”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“So I think I'm perhaps a bit more cautious in their respect. I've come from the traditional finance 20 years in traditional finance where the higher a yield is, the higher the risk is essentially. I think that kind of comes true. There's been some really great medium articles on this, actually, where people have managed to yield farm and get some quite incredible yields. But quite often they're very aware of the risks they're taking. And for now, where we've not seen, it's when you see a crash in the markets when these things really unwind in a very ugly way, you know, it's the same inequity markets when a company is offering you a 12% dividend yield, you've got to think, okay, wow, there's something clearly wrong with that company. Maybe it's a turd you don't want to touch. And I think it's possible, like, yeah, I'm sure people are making money in it, but that's too punchy for me, I'm afraid.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“As they are today. In yield farming in particular, which I think, by the way, encourages people into Ponzi schemes in some respects. You could argue that people are flipping from one high yielding place to another high yielding place. For instance, I think a lot of people flipped into Avalanche recently. And that's obviously quite high yielding. And you could argue Is this becoming a bit Ponzi-esque? You know, if I'm to be a bit critical here, people are piling into it for the yield and for no other reason. I think you have to be a little bit cautious in that respect. And perhaps in yield farming, people aren't looking at the fundamentals either. They're just looking at what's the next best yield. And that's a bit dangerous. And I think is an area of DeFi that's becoming quite frothy and people should be cautious.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Are people replacing it Bitcoin and other crypto coins with they're moving away from bonds? Probably. I mean, bonds, you know, people start to talk about Bitcoin being in a bubble, but theoretically bonds are in the mother of all bubbles. They've been basically if you look at bond yields over the last 40 years. They've been trending downwards. I mean, that is madness. And I think across the developed world, we'll move into a situation where you have to pay to lend people money, negative yields, essentially. And that will push more and more people into things like stablecoins and they'll become increasingly popular. Now, I think the other sort of side of it is the DeFi market is still a very infantile, a very young market and yields for that reason are still quite high. I think as the market matures, those yields won't be quite so attractive.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so I mean Bitcoin bonds are fixed income. You're guaranteed those returns unless that entity that issues that bond goes bust like the government or whatever, you guarantee that income. And the thing about stablecoins is different in that respect. It's more like a dividend yield. The income you receive in that stable coin or whatever sort of product you're investing in, whether it's Solana or Polkadot or whatever, is a function of something and it's not a fixed income in that respect. And so Stablecoins is a function of people's appetite for and creditworthiness for DeFi products. I think for something like Solana or Polkadot, it's written into the code, isn't it? It's a proportion, the appetite for those funds. That's how the yield is calculated. So, I mean, it's different in that respect. But I think when you start to look at it, you know, why...”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“For a longer time, even than institutional investors in that respect. So, yeah, I do think that if you're trading an ETP, well, you're more like what we're seeing is greater trading mentality on exchanges than exchange shared products. Yes, definitely.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“There is actually, overall on the Bitcoin network, there is an increasing hodler mentality. If you look at UTXO data, you can find that people that hold money for a year or longer in Bitcoin was 30% in 2012. It's now 54% today. So there's definitely just overall a hoddler mentality, which does allude to this idea of it being a store of value. If we look at net new assets in exchange-traded funds, hardly anyone is selling out. Although we had a big market correction, we did some outflows, we did see some outflows on the grand scheme of things. If you look historically, that's just been, the outflows have been just minimal. People for the most part are just buying and holding. And certainly, you know, actually it's known that retail investors tend to be kind of stickier investors. They tend to buy and they tend to hold.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“And James, do you find that if there are two investors who are completely identical except one of them buys Bitcoin, the actual Bitcoin, and another one buys a Bitcoin exchange traded product, is the person who buys the exchange-traded product likely to be stickier, i.e. not be hot money at just chasing it going up and then getting out, or as soon as it crashes, they get out. And holding for a longer period of time and therefore posing a structural dampening of volatility or not.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Your remote. So if one of those exchanges goes bust, what happens to that individual's assets? What happens to it? It's not entirely clear. Now I expect that there will be some sort of clawback for those individuals that had it at that exchange for their assets but it might take quite some time to get those back. Also exchange rated funds kind of guarantee liquidity as well. So it's been known on some exchanges that when you have periods of market stress, let's say you wanted to sell out and you call out your exchange. You try to do it online. The website's not working and the phone lines are completely blocked. So you can't execute a trade. Whereas on exchange trading fund, there's guaranteed liquidity. And as a consequence, you can always trade no matter how stressful the market is.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, there's several ways. I mean, I think if you can buy through Coinbase directly in your pension, then maybe it's a good way of doing it because there is an annual fee for an ETF, whereas there isn't for Coinbase. There is a trading execution cost, but after that, there isn't really. But you do start to, when you start to go into the realms of regulated funds, you start to have challenges. So if you want to buy in your pension, you have to, it has to be in a regulated structure, so on an exchange that's exchange traded really means it has to you have to be able to train it on a regulated exchange now coinbase is not a regulated exchange yet so you can't do that it might be quite some time before that happens there are other more due diligence questions you have to ask yourself as well is are all the exchanges like crack and coinbase bit stamp etc are they bankrupt”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“of confused with you can confuse it with the seed capital which can be something quite different to regular investor inflows I think what's encouraging for us is I think the better question in my opinion is where are we seeing the regular investor inflows and if I look at across all the different asset classes you know if we look at regularly flows you know it's it's it's polka dots it's multi-asset it's cardano it's litecoin to some extent Solana Tron a little bit you know we do have this other section which is other smaller coins but that's still pretty you know pretty small it's only representing around 75 million dollars of assets under management so it's not too big”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“There have been some new product launches, avalanches won and a couple of others. I think it's really early days, you know, because if you go from one, what happens when a fund is launched with what they call seed capital? So they might get a group of investors to agree that they will cede the fund to the tune of $5 million, sometimes 10 million, maybe 50 million. And so in those very early days, so we've had a few more funds launched. I tend to keep on top of it. So when something's been around for about two or three weeks, I add it to the list. That list is obviously getting bigger and bigger. And I don't know how I'm going to fit it in the table soon. But a good example is Tron. Tron coin is obviously launched about a month, month and a half ago. And it did have some sea capital, but it does seem to be having a little bit of momentum, people continuing to buy. But I think in the early stages of the first month or two, I just think you have to be a little bit cautious because it's kind of...”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, I've not had too much client feedback on this one, but I'm guessing people have seen some of the protocol challenges Cardano's had and felt that the Solana is much more compelling prospect. You could argue that it's still within that top five. I think Kadana, yeah, it's still in that top five space. So it still could benefit in that respect. But yeah, I think people just balancing the fundamentals and saying Solana looks more attractive. Now, I think Ripple, you know, what is the investment case for Ripple? It is about making interbank transactions more efficient. Maybe there are better ways of investing than buying Ripple directly. Maybe you buy the banks that adopt the systems. Maybe for an investor's perspective, that's a better approach to take.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“the latter i think when people buy ethereum they're looking at the fundamentals they might their intention might be to buy and hold it but they want to kick the tires of it understand that it's a sound network you know is vitalik butuin and his team ethereum foundation are they making sound decisions for that network you know how successful is eip 1559 you could argue it's not been a great success story to date And people will look at all these different factors and make a judgment to invest in Ethereum or not. And that might be a long-term holding quite a sticky asset from that respect. But, you know, these sorts of fundamentals are what people measure Ethereum and how they're digital assets by.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“And if investors are just trying to buy and hold Ethereum, would they care about the gas fees as much? Or is it just that they think the gas fees sometimes exorbitant gas fees can kind of derail the system and make it less attractive to use?”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“The moment in terms of crypto investing, it's probably Solana in that respect. I mean, that's not to negate like Ethereum. It's seen $1.2 billion of inflows year to date. So that's still clearly very popular. But people are starting to vent their frustrations and buy Solana as well.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“They don't care so much about a distributed network at the moment because Solana is less distributed than Ethereum, but certainly they really like the idea of a network that has much lower gas fees, can transact much more quickly. So I think that represents that. It also represents this demand amongst investors because one of the things you didn't talk about was multi-asset funds. Investors are really liking the idea of buying a group of coins in one in one investment vehicle, a multi-asset crypto, like a top five crypto, for instance, because people want to diversify. They've got used on people's learnings journeys. Some of them got used to this idea of Bitcoin and Ethereum. They're starting to look elsewhere and thinking, actually, one of the best ways to diversify is maybe buying the sort of the top five. So that's been very popular too. But yes, I think Solana in particular, if you were to look at what's winning the kind of world computer theme,”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah. I mean, investors are all on a learning journey, I think, in digital assets. It's a very new asset class. And people are at different stages along that learning journey. Many, particularly in the institutional space, are only just getting to grips with understanding Bitcoin and Ethereum. They will also, if you look at the products and when they were launched, virtually all products other than Ethereum, Bitcoin have been launched this year alone. So there wasn't really much except Ripple, for instance. There wasn't really much options for people to buy. It was just Bitcoin and Ethereum. And particularly last year, the conversation was all about Bitcoin and Ethereum and nothing else. And this year it's really branched out to other things. I think people have seen the price appreciation of Ethereum and thought, okay, along comes that some gas price problems. Okay, what other alternatives are there? And then people, I think, have been very much, I dare to say perhaps they foregone their...”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“And I think that makes sense for their clients. I mean, there could be at the moment they could perhaps modify their funds so that I don't know the legal ins and outs of this, but they could modify it so it has daily trading, which might help negate the discount problem that it has. But it's very much, well, I saw it many times is when it was trading a significant premium, that reflected people's demand for it. And when I was trading at a discount, it reflects people's lack of demand for it in some respects. But there also isn't the next best option isn't necessarily the pro-share ETF because it's futures-based and it doesn't track the prices well. But it's cheaper and it's probably a better option than a closed-end fund.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, it's underperformed Bitcoin price by 132% over the last year. So yes, this is the problem with closed-end funds is you can't freely trade them. And I think I've seen the recent, the most recent grayscale comments. And I think this is their frustration. I mean, it was the only kind of solution they could come up with at the time, a bit like our exchange traded note. And I think it's quite right actually that they're pressing the SEC to say, right, it's time now for physically backed exchange ETF. Because even with a futures-based one, by my calculations, a futures-based product over the last year would have underperformed by 29%. So, you know, even a futures-based one doesn't track. So it's right that they're pushing towards a physically backed one. It will track the price a lot better.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“To have that one settled now, if you combine all our assets under management, I think our AUM is around $6 billion at the moment.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“No, it's kind of future space, it's what they call an ETN exchange traded note. We're getting deep into ETP terminology here. Essentially, it's fully hedged against Bitcoin, but I think back in the day, it was the first ETP of its type back in May 2015. It just wasn't, there was no kind of legal or technical ability to create in a physically backed product at that time. And therefore, this was the next best thing. I mean, the problem with an ETN is it's not technically bankruptcy remote. So if the company fails, you could lose your investment with it. And so we have launched new products, our physically backed ones, where they are technically bankruptcy remote. So if, you know, I think this is a due diligence question for many professional investors. They want to have, they want to.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“The SEC, in other words, allowing a futures-based product, not a physically backed one, was a first step, I think, in, I think, really using signals that there's regulatory acceptance for that. And that's a massive thing because the Bitcoin price volatility and regulations are highly correlated when there's some negative regulatory statement, Bitcoin volatility, really picks up. So, you know, Bitcoin prices are very sensitive to regulatory decision making.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“that pent up demand just suddenly unwound and a billion dollars in a week or 1.2 billion dollars in a week it was quite phenomenal really i think it was like the the fourth largest sort of launch of an etf on record and that's any etf so it's quite substantial i think it this marks a sea change the secis decision marks a sea change in global regulatory approaches because i you know certainly in europe we see bitcoin etfs or they call them etcs actually technically in europe because it can't be an etf but um in europe we see them across all the different exchanges zitra in germany the paris urinex and swiss exchanges as well so um it's there and i think regulators have accepted it um it's not accepted in the uk anymore for retail investors which is frustrating for us um but in the us there was that big question mark and i think”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, I think there was this pent-up demand. I mean, we were all looking at grayscale and thinking, well, you know, this is a closed-down fund, which means basically when you buy it, you're locked in for a certain period of time and you can't sell out, or you can try and sell it on the secondary market. And so what's happened is that actually a lot of people have been selling on the secondary market, and that's led for it sort of become traded a discount on average around 15%, which leaves it in quite difficult with many people who own it in a difficult situation. If they want to sell, they've got to take a 15% hit. And so that is, and quite often people were buying a significant premium in the heydays for the grayscale fund. And so what we've seen actually is no fund flows on the primary market for Gracegirl since February. And there's just been this pent-up demand. And I think when ProShares was launched and the SEC approved it, that”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“actually what this data shows is it's actually pretty small and it demonstrates there's a lot more going on in bitcoin than just you know these investor fund flows”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I know this Fumflow report gets a lot of attention, but if you look in the sort of bottom second page on the bottom right, I always include a chart and it demonstrates the percentage of exchange traded product flows as a percentage of total Bitcoin flows or total Bitcoin volume. And what you find is actually it ranges anywhere from four to eight percent of Bitcoin total Bitcoin trading turnover. And that's, I've stripped out wash trades there. So on average, Bitcoin this year has been trading around $10 billion a day on the spot market on trusted exchanges, whereas there's only been around, say, $800 million a day on Bitcoin regulated funds. So it's still a very small proportion of that. I mean, there has been, some people I think have been worried that maybe these investors make up a massive proportion of Bitcoin trading.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, it's very difficult actually for us to define exactly without clawing up each individual client and saying, did you buy some or did you not? Which is quite difficult. It's very difficult to disaggregate what's institutional and what's retail. I mean, our estimates are probably only around 10% of it is institutional and the rest is probably retail.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so in 2019, I think we saw around $2 billion of inflows, so pretty decent. In 2020, we saw 6.7 billion dollars worth of inflows. And year to date, we've seen, yeah, nearly, I think it's 9.7 billion dollars of inflow. There's this thing about that people are concerned about is Bitcoin or cryptoassets. Are they going to remain a niche asset? I think it's we can confidently say that's not happening yet. There's still pretty steady kind of increases in inflows every year on year. So that's quite encouraging. It's certainly becoming mainstream. I get a lot of questions around, okay, how much of this is institutional money?”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, I get a lot of questions on this. And a lot of people are asking me for the data. Quite simply, if you have a Bloomberg terminal, you can do it yourself. You just need to get hold of all the tickers of all the different funds. There are around 150 now. And then you need to look at the change in number of shares on a daily basis and then multiply that by the nav, the net asset value. And that will give you the money flowing in and out on a daily basis. It's that simple. There are some other sort of additional complications such as currencies because different companies publish the Nav and in different prices, which makes it quite challenging from a data perspective. But yeah, aside from that, the basic concept of it is very simple.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Price movements because we might see the assets under management of a Bitcoin fund rise from a billion to 1.2 from one week to the next. But it might not have had any money flow into it. So what the fund flows are doing is actually showing you how much money or net new assets are flowing in and out. And it's quite an interesting way of gauging sentiment towards markets, towards particular cryptocurrencies. I think what's really interesting, I think, flavor of the second half of this year has definitely been Solana. It's on a relative basis had some really strong inflows and I think that reflects investors perhaps frustrations with Ethereum and its high gas prices.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I put very similar. I mean, we would love to track hedge funds, et cetera. So I look at every single Bitcoin fund in the world that is listed. So on traditional exchange. So there are, I think, probably quite a few Bitcoin funds that purely operate on distributed ledger networks. But yeah, unfortunately, we can't track those. So every listed entity. So typically that's traditional investors buying. So that might be hedge funds. It might be, but it's predominantly what we call ETPs, exchange-traded products, which is an umbrella term for ETFs that you might have heard of in the United States, such as the new ProShares one. It basically tracks money coming in and out of those funds. And the fund flows are typically out, stay outside of the price movements. So stripping out”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“You can regulate it, you can start to come down a bit harder on, say, the marketing materials for Bitcoin investments. And I think actually that's right. If you look, if you go on to some exchanges, for instance, you can get 100 times leverage. That is crazy. That's so risky. And I think those kind of practices which don't exist in the existing investment world should be curtailed. And actually, I think it will do Bitcoin a service and becoming a much more mature asset in that respect. So actually, I think regulation is a good thing. I don't think it should be confused with a ban. Although I do think regulation will create some wobbles and some prices and Bitcoin and volatility at times too.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, the perceived risks are things like quantum computing and other rubbish like that. But I think the real risks definitely are probably politics in a government ban. And that might come in the form of regulation. We've got the house in the United States debating this right now. I think the current bill is incredibly impractical. Basically, what it's saying is if you're a kid who's mining Bitcoin at home, you will be classed as a broker and therefore should be taxed. That's completely unenforceable, obviously. So the IRS are likely to really push back against that point. But yeah, I do think there will be a government ban. Just the very fact that the SEC have now allowed a Bitcoin ETF suggests they're looking to regulate it rather than ban it in that respect. And I do think there are ways.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so it ticked up to, I think it was around 63, 64% now. So that increasing number of people. And I think if you look at inflation swaps in the market, that measure for sentiment and inflation, that's rising. There's increasing camp of investors now think the Fed have not got inflation under control. And they're very limited in their firepower. So how many rate hikes they might be able to do two, three, four conciliatory rate hikes. But after that there's a lot of people with a lot of debt that if you hike rate raise rates too high those kind of zombie debt holders have it causes a major problem for the economy. So it's very hard to see to square that peg to see how the Fed can keep inflation in control whilst also dealing with the large amount of debt that people own in the United States and across the developed world for that matter.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“now as citing this as a problem this is like a hedge for them against loose monetary policy and against an inflation problem that they might not have under control”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“People who said obviously that they don't own Bitcoin in their portfolio though, what are the biggest risks from what I hear is that, well, the survey tells us that it's politics and government ban, that's what people are most afraid of. Then obviously regulation, they by far outstrip anything else. Now interesting I do, there's one other question I like to call the Zeitgeist question. It's remain the same in both. It's about whether inflation is transitory or permanent. Now the reason why I ask this question is because we think we believe Bitcoin is a real asset offers inflation protection characteristics and what we've seen is a big increase in the number of investors that believe inflation is more permanent in nature. So I think that what reflects is people's increasing fear that actually the Fed has not got inflation under control and there's a big problem and a lot of our institution investors that are thinking about buying”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“accumulate and I think that's fine for bitcoin. There are an increasing this surprise me there's a big increase in number of people that believe that crypto is good value now put that in context of where the price has gone since August this is taken at the end of October even after that strong price rise there are increasing number of people that see it as good value so that to me is really encouraging that people even after these price rises think that don't think the market's overly frothy so another reason you know people are why people are buying it a lot of people say they're buying it for diversification reasons a lot of people are saying because they want exposure to distributed ledger technology so I think that's that's high I mean of the biggest concerns it's volatility is the biggest concern and corporate restrictions and so you know that's of the”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think the most recent for me, the most recent survey has highlighted that Ethereum, the appetite for it is cooled a bit. It's still the most favoured one out there, but we saw nearly 42% of respondents loved Ethereum. It was the most favored asset in our August survey and in our October survey it was down to 30%. So still the highest. Polkadot have seen a big spike up in positive sentiments. I think that's quite encouraging. I had expected actually Solana for us to see a pickup there. But while we've seen it in the fun flows, I've not necessarily seen it in the survey. When we look at why investors are buying the majority still say it's speculative investment, I think for someone that's done the CFA, that's like a swear word. I don't see what's wrong with speculation. My father used to say to me, a speculate.”
2021-12-07 · Forward Guidance · A Little Bitcoin Goes a Long Way | James Butterfill · IDENTIFIED FROM THE TRANSCRIPT