JD Durkin: Bill Barhydt is the CEO at Abra, a digital asset wealth management and treasury platform. Bill, really grateful for a few minutes of your time today. For people unfamiliar, what is Abra? What are you guys all about? Who do you serve?
Bill Barhydt: Sure. Abra is a crypto wealth management platform. We service high-net-worth individuals, family offices, the broader RIA community. We make digital asset investments available to them, as well as loans against crypto assets, high-yield products in the crypto space, and now our tokenization platform.
JD Durkin: Bill, I’m sure you know as well as anyone the ill-fated kind of result of the CLARITY Act down on Capitol Hill a few weeks back. Where do things actually stand, and does it actually matter that the CLARITY Act was unable to pass Congress in this midterm year?
Bill Barhydt: So in the short term, it’s actually a benefit. In the midterm, we’ll see. In the short term, it gives the SEC and CFTC the ability to just move ahead via decree, and that’s what they’ve been doing. Basically, it feels like they already had their decrees ready to go on how tokenization was going to work, how perpetual futures were going to work, and basically all the aspects of the CLARITY Act. The key is going to be making sure that the next administration can undo any of those decrees. And the more entrenched these decrees become in the financial services industry, the more likely they are to stay.
JD Durkin: Bill, I’d love your take on the whipsaw price action of BTC. Bitcoin’s now up about 40% off of where it closed around Tuesday, June 30th. What do you make of all the price action we’ve seen in the crypto major?
Bill Barhydt: Yeah, I think three things. One, I think the structural bull market is returning, and I think we’re in a bit of an accumulation phase in that bull market. I think it’s exacerbated by two and three, which is the price of oil and the oil shock coming out of, you know, what’s going on in the Middle East, which I think will resolve itself this year. And I think a significant drop in oil will have a boom effect on Bitcoin, which tends to act as, you know, a liquidity suck on expected market liquidity.
And I think that the bond market is also entering a midterm accumulation phase. I think the mid-to-long range has topped in the short term. I think long term, three or four years out, bond prices have to plummet and yields have to go higher. But we’re now, after a significant multiyear rise, in an accumulation phase for a while, which could last up to two years. And that would act as significant tailwinds for crypto prices in particular, which would react very well to stabilized and falling long-term interest rates.
JD Durkin: Let me get your macro picture here, Bill. Yields are high. Inflation’s sticky. No one exactly knows what the Fed is going to do moving forward. What does all that mean for the crypto majors?
Bill Barhydt: Well, it’s really a function of what debt costs, right? And so if debt costs stabilize and go down a little bit, which is what I think is going to happen in this accumulation phase, I think inflation will stabilize as a result of the war ending. Really, right now the biggest cost contributor to inflation is fuel prices, and secondarily home prices in certain markets. And second, as I said, all of that acts as a liquidity suck for crypto prices as well as tech stocks. But crypto prices are more volatile, because it’s more of a pure-play kind of reaction to market liquidity.
JD Durkin: Bill Barhydt, CEO at Abra, really grateful for your time. Great to have you for the conversation. Thanks for being here, Bill.
Bill Barhydt: Anytime. Good to see you.
