Kyle Bass is the founder and chief investment officer at Hayman Capital Management. He has predicted that countries will begin to clamp down hard on Bitcoin. He predicts that “intense” crypto regulation will come out of the U.S. Treasury and the Internal Revenue Service (IRS) next year.
Fund Manager Expects ‘Intense’ Crypto Regulation Next Year
Kyle Bass, founder and chief investment officer of Hayman Capital Management, talked about bitcoin and the outlook for cryptocurrencies in an interview on the Investor’s Podcast Network, published Saturday. Bass was a successful hedge fund manager and made winning wagers on subprime mortgage loans in 2007.
While acknowledging that “Millennials love private crypto” and “people like to think it’s a perfect substitute or a great substitute for gold and/or an inflation protector,” Bass said:
I tend to think that you’re going to see authoritarian governments and Western democracies alike start to really clamp down on bitcoin.
China is a nation that has taken steps to crack down on crypto activity. “I know China first kicked the miners out and then banned private crypto. They did that a year earlier than I expected them to do it,” he opined, adding:
I think next year, you’re going to see intense regulation come from the US Treasury and the IRS.
He also discussed “discount rates” and how to protect against “this insidious inflation.”
“I know bitcoin has done well. I know that the returns have literally been off the charts for many, and there are many newly minted billionaires out there in bitcoin land,” he noted. However, he warned: “I think the easy money has been made … I think from here on out, it’s going to be really difficult to make money there.”
Bass further shared: “I own a couple of private positions in big firms that are trading, lending against, and developing bitcoins and NFTs [non-fungible tokens] and all of the digital universe of alphabet soup things that are out there.” He concluded: “I think that the blockchain, I think that NFTs, those things are all very much here to stay. In the long term, private crypto I am hesitant about. I’d be careful with that now.”
We are not in a bubble, according to the investment manager. “I don’t believe we’re in a bubble today, as far as ratios are concerned and leverage in the system is a concern,” he said.
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