Bitcoin Rebounds After Selloff as Strive CEO Defends Long-Term Bull Case

Remy: Welcome back to Market Movers the Opening Bell. While some of the top Bitcoiners are in the Big Apple this week for Bitcoin Investment Week, the conference comes less than a week after Bitcoin's worst day since the FTX crash, the selloff erasing all gains since Trump's election and also wiping more than $2 trillion from the crypto market. But Bitcoin did bounce off extremely oversold levels and has rallied about 15% off its lows below $61,000. Bernstein analysts say Bitcoin's crash reveals a crisis of confidence, but they do maintain their $150,000 price target by the end of this year. And institutional warning Bitcoin could hit $38,000 based on the four year cycle. So if it wasn't a single catalyst event, but a deleveraging cascade to tied to for some lines of leverage hedge fund trades through Bitcoin ETFs. Why now? Well joining me to break all of this down here at the New York Stock Exchange is Matt Cole CEO of Strive. Matt great to have you here. Thank you so much for joining me.

Matt: Thanks for having me back,Remy.

Remy: Well, first and foremost, let's talk about what we saw last week and the price action on that crypto major Bitcoin. What is your take?

Matt: Yeah. So we expect Bitcoin to be a volatile asset. And that volatility is where the opportunity lies. And so when you see these types of drops first off we expect them to happen. That's not to say that we predicted last week or this month that we would see a massive decline.

But what we try to do as a Bitcoin company is say we expect Bitcoin to be volatile, we expect 30% drawdowns, we expect 50% drawdowns. We actually at this point underwrite but don't expect 80% drawdowns. So 80% would be like a typical drawdown in a Bitcoin bear market. And so our view is right now we're more likely to be in the bottoming process. So that's not to say a bottom is in. It could be. It could not be. I wouldn't be surprised either way. If you had to have me flip a coin, I would say I would think it's slightly more likely that we might see slightly lower prices, but but we're not expecting that. We underwrite a Bitcoin bull thesis that over the long run, we expect Bitcoin to go up 30% plus on average. And then we look to take advantage of that and how we structure our company. And so this move is not surprising. It's part of the journey. And that's why you know we're excited for Bitcoin Investor Week this week because it's important to actually question, have the fundamentals changed? And I think if anything over the last couple of years the fundamentals have only gotten stronger not weaker.

Remy: Yeah. And we've seen volatility across all asset classes this year. It's not just the crypto market but also equity markets as well as what we saw in precious metals and even bonds across the world. So when it comes to Bitcoin, can you expand on this thesis and why you're positive on the crypto major.

Matt: Yeah. So the markets have been extremely volatile as you pointed out. Right. SaaS has been going down massively. And there's been a lot of talk about why that could have some of a, some a drag on Bitcoin that a lot of these SaaS investors tend to overlap with Bitcoin investors over the last several years. That's one thesis. There are several thesis of what caused this drawdown. But the reality is, is that sometimes I think you don't know, but with an asset like Bitcoin, you tend to get people that put leverage trades on And that leverage causes leverage flushes. Right. And so it's why we've taken an approach to never encumber our Bitcoin, never post margin ,that Bitcoin could go down to a dollar. It could the futures could go negative. And we would be okay. As long as the long term bull thesis plays out. It's very similar to strategy I think you see a lot of people that think strategy is going to have to sell Bitcoin. And they're they're not, unless Bitcoin absolutely fails as an asset, which I don't think it is. So then what are the strong fundamentals. Well the biggest one in my view is that we're entering an era of abundance. That AI is going to be an era of abundance, that the cost of many things are going to go down. So the question becomes, what is scarce in an era of abundance, an era with a debt crisis? And I think it's obviously gold and silver, but Bitcoin's digital gold and it's actually more scarce than those assets. And ultimately I think it'll be more valuable as well.

Remy: Yeah. And when we take a look at the chart for Bitcoin, if we're just looking at the one year chart, many of us might focus on the beginning of October as well as what happened to Bitcoin last week as well as the rest of the crypto market. But when it comes to some of these structural risks, has anything changed?

Matt: No, I think quantum risk is a real risk to discuss, but ultimately I don't think it's a risk that will be existential to Bitcoin. I think Bitcoin will be in front of it. And also that there's several other sectors, basically the entire global financial economy that thinks much weaker than Bitcoin. so it's something that's serious.

But ultimately I don't think it'll be existential. I struggled to think of something that actually is existential at this point for because I think it's the strongest conviction idea that you can have. The only thing that would make me change that, mind my mind on that, would be if the government stopped printing money and they fixed the debt crisis I do not think that's going to happen. I would put a 99.999% chance it doesn't happen. And so as long as that's true, I want to be as long Bitcoin as I possibly can.

Remy: And Matt, you're here in New York City to attend Bitcoin Investment Week. And a lot of top bitcoiners are going to be in attendance. Of course there's going to be a lot of focus on some of the conversations as well as panels taking place. But what are you focused on right now and why?

Matt: So what we're focusing on is trying to help the community to remind themselves that in an asset like Bitcoin, you don't want to take leverage. There's been several examples of people that have been forced sellers. Some Bitcoin treasury companies have been forced sellers. Individuals that, you know, I've interacted with on X have talked about how they took too much leverage. so this is the importance of what we've talked about in building a digital credit market and why, you know, we take this long duration view of Bitcoin and why we're sleeping really well right now because the thesis hasn't changed.

The price selloff was expected to happen at some point. So this is just part of the journey And if that's the case, you can be very comfortable in Bitcoin. And if you can't it's actually important to learn those lessons right. And sometimes people need to learn those lessons. And it's okay. Right. Sometimes it's okay to learn lessons. And so we want to be here and we want to be part of the community and the the good times and the bad times.
Remy: Yeah. And finally, before I let you go, I know you're going to be heading uptown to this event. I do want to ask you about what's happening in Strive and what's the future for the organization?

Matt: Yeah. So the first thing is that we are the second issue of digital credit. So strategy had their earnings call last week. They focused on stretch being the core to their to their future. We already have a debt free structure that's 100% backed by digital credit. We now have $10 million left of the summer debt. We publicly stated we plan to retire it by April. We have the cash set aside to retire it. So it's not a matter of when, but just if and if we've said it will be April. So we're digital credit only, which provides the amplification that I think is appropriate for the market. So the idea is outperform Bitcoin over the long run and underwrite a Bitcoin bull thesis. And that's the future for us. And so I think that's the focus. There's potential for some yield strategy to come into play over the next couple of years. But we want to make sure that that's done well and institutional. And so you know, we've said no to a lot of opportunities there. But I think there's a few that are that are interesting. So potentially more to come.

Remy: Yeah. And before I let you go, one thing that I thought about, of course, is our focus on regulation or expectations coming out from the nation's capital in D.C. So last week we saw the white House as well as different agencies, including the SEC, CFTC, get together. So what are your expectations when it comes to the timeline for actual legislation?

Matt: So it's kind of been an ugly fight in D.C., and that's not surprising. You see a lot on the stablecoins, where the banks do not want the stablecoins to pay interest because it would completely ruin their business model. But from a technology perspective, they 100% should be able to pay interest. And so that fight makes sense. And I think the right approach probably is a gradual approach that if you actually just let stablecoins pay interest, you would probably have a global collapse of the whole banking system. And I don't think that's in anybody's interest, although I think we should accept that technology has improved and that if someone has dollars in their checking account, they should be the holder of that, that gets the interest. And so I think that's where it ultimately goes. But it's going to be a messy fight. And I think that's why we're seeing things slow down. So I don't have a specific timeline other than I think this makes sense that it's been a messy fight.

Remy: Well Matt, great having you here. I do want to mention that was a first trade bell and we were not in the boxing ring talking about a match starting to happen. as always, thank you so much for joining me and I appreciate your time. Thank you.