- Billionaire hedge fund manager Philippe Laffont admits he wakes up at 3 am regretting not buying Bitcoin earlier, calling himself an “idiot” for missing out.
- He previously avoided Bitcoin due to its extreme volatility being double or triple that of the already volatile NASDAQ, but believes this is now decreasing.
- Laffont calculates Bitcoin could reach US$4-5 trillion market cap by comparing it to global wealth of US$450-500 trillion, suggesting BTC could grow from 0.5% to 1-2% of world net worth.
- He rejects extreme predictions, though acknowledges factors like global de-dollarisation could support Bitcoin’s bull case.
Billionaire investor Philippe Laffont regrets not getting into Bitcoin earlier, but he also mulls over when the right entry point might be. Speaking to Joe Kernen, Becky Quick and Andrew Ross Sorkin on CNBC’s Squawk Box, Laffont said the total market cap of BTC could hit US$4–5 trillion (AU$6–7.6 trillion).
The co-founder of hedge fund Coatue Management said that he wakes up “every day at 3:00 in the morning” regretting not having bought the OG crypto.
And I’m like, why am I such an idiot? What have I been waiting for? Not being involved in it? And it just goes up and up in the past.
Philippe Laffont, Coatue ManagementAs Volatility Comes Down, Laffont Increasingly Thinks About Investing
So, why didn’t he get involved in Bitcoin earlier? Likely because of volatility.
[Bitcoin] is double or triple the volatility of the NASDAQ. [The] NASDAQ is already pretty volatile. Why do I need to deal with this?
Philippe Laffont, Coatue ManagementRelated: Pompliano-Linked ProCap Buys 3,724 BTC as It Prepares for $1 B SPAC Debut
Though Laffont suggests that Bitcoin’s “volatility as an asset class is coming down”.
Still, he isn’t quite sure when to start deploying capital into BTC.
Do I own it now? Do I own it tomorrow? In a few days? But every day I do think, why do I not own it?
Philippe Laffont, Coatue ManagementHe says that’s the thing about being a good investor. It’s not only about holding the right investment, but also that “sometimes you have to change your mind and you have to just say, well, I made a mistake and I’m changing my mind”.
How Laffont Measures Bitcoin’s Future Market Cap
So how does Laffont measure Bitcoin’s future worth? Does he see it as part of gold’s market cap?
The billionaire says he starts with the world market cap – so, real estate, bonds, equities, private businesses, etc. – which is around US$450 trillion (AU$690 trillion) to US$500 trillion (AU$766 trillion).
He puts the global equities market at roughly US$120 trillion (AU$184 trillion) and gold at US$20 trillion (AU$30 trillion).
Given that the current Bitcoin market cap is just US$2 trillion (AU$3 trillion), Laffont believes it could double or even quadruple:
Let’s say [Bitcoin] represents half a per cent of the net worth of the world. Could it go to one or two? […] Could it double over a period of time?
Philippe Laffont, Coatue ManagementCan BTC Ever Get to US$21 Million a Coin?
However, he rejects, what he calls more “aggressive estimates”, of a US$100 trillion (AU$153 trillion) market cap. Recall that Michael Saylor believes that BTC will cost US$21 million (AU$32 million) per coin within the next 21 years – that’s a US$441 trillion (AU$675 trillion) market cap.
If nominal global wealth grows by 4–6 per cent per year, Bitcoin’s market share would be an eye-watering 33–41 per cent.
Impossible? Maybe. Laffont doesn’t suggest it can happen, but says there are some other reasons for a Bitcoin bull case:
We’ve talked about the de dollarisation of the world, the end of US exceptionalism. So those would be some other reasons.
Philippe Laffont, Coatue ManagementRead also: US Housing Regulator to Probe Crypto’s Role in Mortgage Eligibility
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