Bitcoin Slips Below $70,000 as Stablecoins and Tokenization Gain Momentum

Remy: Welcome back to Market Movers the Opening bell in New York morning trade we are looking at Bitcoin extending declines this morning pulling back by about 4% after falling below the $70,000 level. And of course we're keeping an eye on the other crypto majors as well. And while we're keeping an eye on prices, we're also keeping an eye on regulatory progress as well as institutional adoption. stablecoins are among the top winning DeFi themes right now.

Prediction markets and tokenization adoption are also accelerating while the crypto and broader market slumps. Well, joining me to weigh in this morning is William Quigley, co-founder of Tether and WAX. Good morning, William. Thank you so much for joining me. So we are keeping a close eye on the crypto majors this morning.

Those technical levels for Bitcoin as well as ether. And many crypto leaders are railing against the so-called four year cycle when it comes to Bitcoin. So what do you make of the landscape right now?

William:Well, I would say, yeah. The four year cycle for the listeners was every time there was a happening where Bitcoin's rewards dropped by 50%, which happened once every four years, there tended to be about a 18 month rally after that. Now there were you know, we don't have a lot of data points, but there were three previously. And then we had the fourth in 2024. There was a rally of sorts. Bitcoin at the time was trading at about $65,000. It went up to little, little less than double 125,000. But that is much less than what it's done historically. The last Bitcoin happening we went up almost 10x. So I think people myself included were expecting more. it is maturing.

It is $1 trillion plus asset. Those things are harder to move. And you do have other types of ways to speculate, and a lot of people invest or speculate in Bitcoin because they love the volatility. There are other things you can do. And so I think this is more of a maturing of an asset. That's why we see it where it is now the pullback. I think that happens because Bitcoin has historically been far more volatile than the traditional markets.

So if the S&P drops 10% Bitcoin is going to drop a multiple of that. And I think that's what we're seeing right now.

Remy:Yeah. And William you bring up an important point. We're seeing volatility not just in Bitcoin and the other cryptocurrencies but also across all asset classes. For example, in the equity markets we are seeing a rotation and precious metals. We are seeing quite the price action this morning as well after hitting all time record highs. in the crypto space when it comes to Bitcoin versus ETH.

Tell us about the divergence we're seeing right now and why?

William:Yes. So Ethereum is different from Bitcoin of course, because Ethereum is essentially a computer you can use to make a smart contract, to do lots of clever things, particularly in the area of DeFi. Bitcoin has never been terribly good at building on, but it is quite reliable place to ensure no one can hack your your Bitcoin. It's considered the most trustworthy of the blockchains. However, all of the blockchains other than Bitcoin, every other crypto moves in correlation to Bitcoin but at a higher volatility. So generally speaking, if Bitcoin goes up by 10%, other cryptos might go up more than that. Ethereum was no different other than it was the second biggest of all of the cryptocurrencies. And I think, uh, maybe what's a little bit concerning is just that Ethereum lagged behind Bitcoin throughout the 2024, 2025 post halving period, and that historically was not the case. It usually was more volatile, meaning it went up a lot more than Bitcoin did. And it really it just about got to where it was four years ago, and there was about $4,800. It hit that last year. And now it's at whatever, a little over $2,000. So I would say

Ethereum has behaved much more like other smaller market cap cryptos than what it did in the past, where it was a little bit more reliable, reliable than what you would see with a much smaller cryptos. So as of right now, I would say with the Fear and Greed Index where it is, which is 12, I've talked about this before. When the Fear and Greed Index drops below 20, That's pretty extensive fear in the market. It's at 12. I will say anytime the Fear and Greed Index has been below 20, within a year you will have-

if you bought crypto at that time you would have done very well. So what I like about the markets I don't like much, but one thing I do like is while Bitcoin and Ethereum are way off right now, Fear and Greed is very high. And so historically when that happens, as soon as people get a little bit more confidence, you see prices snap back. I would be much more worried if Fear and Greed were moderate and the prices were low. That would be concerning.

Remy: Yeah. And, William, at a time like this, it is important to take a look at what's happening under the hood and know what indicators to look at. But if we take a look at the beginning of this year, it's hard to believe that we're only kicking off the second month of 2026. And of course, a lot of institutions, top analysts were wrong in their predictions. So have you shifted your outlook when it comes to digital assets and tell us your take on tokenization as well as stablecoins as we head into 2026?

William: Sure. So as far as where I see cryptos, how they're behaving in the year following, a year and a half following the happening, traditionally about 18 months after that happening period, which would have been November 2024 or 2025, crypto has historically had a major pullback. So this is consistent with what we've seen historically. The pullbacks have been as deep as 75% for Bitcoin and more for Ethereum. Some people thought that since Bitcoin and Ethereum hadn't gone up so much that they wouldn't fall a lot either, and only time will tell if that's true. With regard to stablecoins, I believe stablecoins are the most important development to come out of blockchain technology. I've said that for a long time. You're seeing a lot of institutions, particularly with the Clarity Act, moving along in the legislative process in the U.S. You're seeing a lot of institutions, financial institutions in particular, thinking they should be involved in that tokenized assets. That makes a ton of sense. The main value you get there is a high degree of confidence that the thing you're receiving is genuine.

That's due to its association with the blockchain, which is very hard to track. So in times where trust, particularly in digital platforms, is low, blockchains are extremely helpful. And so I think the rise of tokenizing assets will lead to more trading because people will be more confident that they're getting the genuine article that they traded for.

Remy:Yeah. And William, before I let you go, we are keeping a close eye on prediction markets. And of course we're counting down to Super Bowl weekend. But prediction markets are accelerating while the crypto market struggles. So where would you say the retail attention has gone and why?

William: you answered it. The prediction markets. I think this rally, this 2024, 2025 happening period, retail consumers didn't really show up in the crypto space. It was much more of an institutional thing. And, um, that might be because of the extreme volatility they experienced when they were getting involved with the meme coins. And I think meme coins were problematic for a lot of reasons. They were things that if you didn't pay attention in literally one day, you could lose half or more of your money. And consumers also like new things. They like novelty and prediction markets offer that. But prediction markets remain incredibly small from an overall liquidity and volume standpoint as compared to crypto, which is, you know, 24 over seven global phenomenon. prediction markets aren't going to replace crypto.But there are another avenue for people who just want to speculate.

Remy: And William, finally, before I let you go, we have about 60s here. So in this day and age we have a wealth of information, whether we're talking about legacy media, social media, prediction markets or even podcasts. But given all this volatility we're seeing in digital assets, in particular the crypto majors, what are the major headlines missing and what are you paying attention to?

William:Well, I think the crypto press is extremely helpful. You get a ton of avenues from YouTube to Twitter. You get a lot of information, almost too much if you will, but there's plenty of information there. I think the most important thing, and maybe it doesn't get enough press because it gets crowded out, is this omnibus piece of legislation, the Clarity Act, that I referenced earlier, which is going to give a framework for how the CFTC and the SEC regulate crypto. That's something we've all been wanting for 15 years. And with that, I think you'll see many more big institutions moving into the space. They couldn't before because they didn't know what the rules were. And hopefully by the end of this year or sooner, we'll have that Clarity Act passed.

Remy: Well, William, thank you so much for joining us this morning. I appreciate all your time, and thank you so much for sharing your insight as well as perspective.

William: You're welcome.