Kevin O’Leary states why NFTs will outperform bitcoin

  • January 6, 2022

Kevin O’Leary states why NFTs will outperform bitcoin

Kevin O’Leary, a “Shark Tank” investor, is a firm believer in non-fungible tokens, believing that they have a chance to outperform bitcoin.

O’Leary, the chairman of O’Shares Investment Advisers, believes in NFTs because they can digitally establish ownership of real-world objects like fancy watches or flash automobiles rather than using paper records.

 

NFTs are one-of-a-kind crypto tokens used to track the authenticity of rare virtual collectibles like art and sports remembering ability. NFTs have also been applied to tangible assets.

 

“Over the next several years, you’ll see a lot of movement in terms of completing authentication, insurance policies, and real estate transfer taxes all online,” O’Leary said on CNBC’s “Capital Connection.”

 

“We’ll see what happens, but I’m betting on both sides of the equation.”

 

In 2020, few people had heard of NFTs, but the next year, they became a massive craze. According to some estimates, more than $20 billion worth of tokens changed hands in 2021. After a collage by digital artist Beeple, whose real name is Mike Winkelmann, was sold for a record $69 million, the trend garnered a lot of attention.

 

However, there are doubts regarding the market’s long-term viability. Some have linked it to the 2017 initial coin offering frenzy, in which some investors were scammed by uncontrolled token sales betting on start-ups. Meanwhile, a number of scams and cases of stolen art have surfaced, raising warning signals for some traders.

O’Leary change of heart?

After earlier calling bitcoin “trash,” the multimillionaire Canadian investor has altered his mind about crypto.

 

In May 2019, O’Leary told CNBC’s “Squawk Box” that the currency is “useless.” “It’s a waste of time.”

 

O’Leary has recently warmed on to the market, seeing it as a way to diversify away from other assets such as real estate in the face of rising inflation. He’s particularly enthusiastic about “decentralized finance,” a strategy using blockchain to imitate traditional financial products.

 

O’Leary recently revealed that ether is his largest holding, although he also holds polygon, Solana, and bitcoin.

 

In the previous six months, O’Leary has written over 40% of fresh checks for crypto and blockchain-related enterprises.

Regulation

O’Leary emphasized the significance of ensuring that cryptocurrency is regulated. Regulators in the United States and others are scrambling to keep up with market developments in order to prevent money laundering and protect consumers.

 

“Different geographies have different crypto policies,” O’Leary explained. “You should seek out jurisdictions that are more progressive.”

 

He used his native nation of Canada as an example of a jurisdiction that is more progressive on the topic of cryptocurrency than others.

 

Canada was the first country to approve a bitcoin-related exchange-traded fund (ETF). Though the Securities and Exchange Commission has since approved a bitcoin-linked ETF, it follows futures contracts rather than investing directly in bitcoin.

 

Other countries that are opening up to crypto include the United Arab Emirates and Switzerland, according to O’Leary.

 

“You have to be upbeat and productive,” stated O’Leary. “A deluge of capital will flow in through sovereign and pension plans that do not yet exist.”

 

Stablecoins, digital tokens tethered to the value of national currencies like the dollar, are of special concern to regulators. Economists are concerned that popular stablecoins like tether and USD Coin may lack the necessary reserves to back up their promises of being backed by dollars.

 

“I think [stablecoins] will shine as a terrific method to obtain yield when you can’t get any yield on cash,” O’Leary remarked.

Movine Oduor
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