Pantera Capital Considers Exiting Bitcoin Holdings

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The founder of Pantera Capital expects several more defaults of crypto companies in the near future - similar to the story of Three Arrows Capital.

Dan Morehead said he expects a “big collapse” to occur within the next two months:

“The fall of Terra is a vivid illustrationinstability of the industry and its economic system. Even companies that actively hedge their corporate risks are not immune from instability. For example, Celsius or Three Arrows Capital are experiencing difficulties and cannot pay their debts. Most likely, there will be a couple more similar bankruptcies in the next month or two, and each bankrupt debtor company will create big problems for its creditors.”

Dan Morehead is sure:It’s too early to say that the crypto industry has hit rock bottom. Therefore, his company is thinking ahead about exiting Bitcoin funds and is going to focus on investing in relatively risky altcoins with higher returns.

Another reason that may affectchange in investment preferences of Pantera Capital, Morehead cited the strengthening market correlation between bitcoins and securities. In his opinion, the position of the US Federal Reserve and a change in the key interest rate could become a trigger for a crisis in the cryptocurrency industry, and, in this context, Bitcoin convincingly demonstrates its connection with company shares.

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In April, Pantera Capital reported thathas raised $1.3 billion for its Blockchain Fund, which will invest in Web3 startups, early-stage tokens and tokens with established liquidity levels starting in 2023.