Kevin O’Leary the world-famous investor and star of ABC shark tank was recently asked in an interview about sovereign wealth funds. Now, these funds are the funds of entire countries, and many times they have billions if not hundreds of billions of dollars in them, and what he said was absolutely shocking. These funds want bitcoin one to three percent and 99% of them only want bitcoin. Here are Kevin’s comments from this interview.
When I talk to sovereign wealth, it doesn’t matter if it’s from Saudi Arabia, Norway, or the United Arab Emirates. They want bitcoin, but they don’t have access to the research we just finished. They desire that volatility and the proximate form of bitcoin.
I think for financial services I agree that eth the gas fees are a joke that’s the problem. In the short term, there is a demand for one to three percent of a portfolio, but that demand will increase if that platform becomes the standard one for other digital assets. These portfolios of sovereign wealth appear like this. 5% for any one brand, and no more than 20% for any one industry. So you’re never going to find you know Boeing or bank of America more than five percent and 900 billion dollar fund all the indexers know that it’s a really standard format.
They respond by asking which digital asset and in what allocation you would choose to purchase if you could. They typically say bitcoin because that is all they are familiar with, and the ranges are roughly 50 basis points on the low end and 300 basis points on the high end.
Now what’s fascinating about this is that sovereign wealth funds have largely sat out from the crypto market, If they start to come in not only do they have hundreds of billions if not trillions of dollars that they collectively can deploy into the market, but they also tend to be very long-term oriented.
So if we see these large asset allocators come into the market and begin to actually hold on to something like bitcoin that likely would be a very bullish sign and provide for a tailwind for the asset. Now, what is holding these exact investors back? Kevin O’Leary went on to explain that regulatory clarity is a key missing piece.
Kevin explains that it will take some time for that demand to materialize and that, in my opinion, it would rank second. They clearly like USDC and they adore Solana and Paulie. According to the market cap, you move down the list. I acknowledge that, but I firmly believe that if we immediately implemented a policy on bitcoin, its value would rise to 60,000 within two weeks.
Now of course it’s important to understand who these investors are and what’s holding them back, but my general view is that the regulatory stuff will sort itself out. We’re seeing lots of regulatory scrutiny due to various issues in the crypto market, but bitcoin continues to be the one asset. Every regulator around the world agrees on bitcoin is not a security bitcoin is something that any institutional investor can put into their portfolio. It appears that the sovereign wealth funds are warming up to that idea and they likely are going to start allocating very large dollars to the asset.
Now of course these things take time and it doesn’t mean that bitcoin is just going to rip upwards in price immediately, but what it does mean is that if you’re a long-term investor and there is a finite supply asset like bitcoin and there is increasing demand over time if you look out 5, 10, 15, 20 years That trend is something you should be aware of because it frequently occurs.