Is Bitcoin a ‘perfect asset’ with a catch? Willy Woo has this to say about the risk…
Key Takeaways
Whereas Bitcoin continues to draw institutional curiosity, consultants like Willy Woo imagine that ETF and company holdings might depart the asset weak to centralized management.
Following a rocky section, the crypto market has been regaining some momentum once more, with the market’s main digital belongings posting recent positive aspects. Actually, according to CoinMarketCap, Bitcoin [BTC] climbed by 2.53% in simply 24 hours, with the crypto hitting $121,278 on the charts.
Thanks to those developments, conversations round Bitcoin’s potential to surpass conventional benchmarks just like the U.S. greenback and gold have resurfaced once more.
“The right asset,” however at a price?
Veteran analyst Willy Woo described Bitcoin as “the right asset” for the following millennium. And but, he believes a warning is due. In line with him, it can’t rival established shops of worth and not using a substantial inflow of capital.
Speaking on the Baltic Honeybadger convention in Riga, Latvia, on 10 August, Woo stated,
“The factor is, you don’t get to vary the world except this financial asset — in my view, the right asset for the following thousand of years — doesn’t get to do its job except capital flows in and will get large enough to rival the US greenback.”
Spot Bitcoin ETFs have performed a task on this influx development too. For instance – Data from Farside Investors highlighted $403.9 million in web inflows on 8 August – An indication of regular institutional curiosity.
Structural dangers in treasuries and ETFs
Naturally, Woo tempered his optimism with warning. He pointed to the opaque debt buildings of Bitcoin treasury corporations, warning that weaker ones might “blow up” in a downturn, triggering steep losses.
Woo added,
“Nobody’s actually publicly seemed deeply into the debt structuring, so I completely suppose the weak ones will blow up, and other people can lose some huge cash.”
Woo additionally flagged altcoin treasuries adopting related methods, doubtlessly “creating one other treasury bubble.” He burdened {that a} sharp market correction or extended bear section might expose over-leveraged treasuries, pushing cash again into circulation.
His phrase of warning echoed earlier issues in regards to the dangers of liquidity focus and over-reliance on ETFs and company treasuries quietly shaping market fragility. The identical may be backed on the quantitative entrance too.
Contemplate this – In line with Constancy Digital Property, the variety of public corporations holding over 1,000 BTC jumped from 24 in the direction of the tip of Q1 2025 to 35 up to now in Q3. That’s the steepest quarterly rise on file.
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Additionally, Sentora’s knowledge showed that Bitcoin treasury holdings climbed from 1.2 million BTC in 2024 to over 1.86 million BTC this August.
What’s he so fearful about?
Lastly, Woo warned that the speedy tempo of Bitcoin treasury adoption might face a harsh actuality verify. Particularly if the market information a pointy correction or enters a chronic bear section.
He added,
“What occurs to the bear market? Who’s swimming bare and what number of cash get slapped again out into the market?”
He believes that the rising reliance on Spot Bitcoin ETFs, pension funds, and company treasuries might centralize Bitcoin in institutional fingers. This would go away it weak to potential state-level interference. Particularly since deep-pocketed buyers nonetheless desire these channels over self-custody.
