Recent report from off the chain Capital finding that crypto investor sentiment hit its lowest level since the FTX crash in June, and that is despite Bitcoin's price being multiple times higher and no major exchange crash.
Now artificial intelligence has also been credited as a factor in the crypto bear market.
Starting in April, the major averages went on a record run with semis seeing their best Q2 ever.
As for its public listing brought in record retail trading activity that biggest launch in history bodes well for anthropic and potentially opening, but the question becomes if capital can flow back from AI and in crypto when insider shares at these companies a lot while joining me live here at the New York Stock Exchange to weigh in is off the chain capital CEO Brian Dixon.
Brian, good morning.
Great to have you here.
Thanks so much for having me.
I appreciate it.
Well here we are the almost the middle of.
August 2026 has been volatile across all asset classes, in particular in crypto, and I understand you have said that fear has round tripped while price has not.
So can you break this down for us?
Absolutely.
So when you look at the crypto prices today, let's use Bitcoin as a specific example.
Bitcoin is trading 4 times its FTX prices, but the fear and greed index print a 10 in June, which shows us that the fear in the markets is almost identical to where it was post FTX.
But what we're noticing today is We don't have exchanges collapsing.
We don't have credit contagion.
We don't have custodians blowing up.
These are some of the events that happened right after FTX.
So we have the fear without the failure.
So to us as a value investor in the digital asset space, these discounts are very attractive as entry points into the space.
In 2026 is quite different from 2022.
So for the layperson out there who's trying to understand this volatility and what's actually transpired in terms of.
Since the record highs at the end of last year to now, how would you explain what we're seeing?
I think there's a variety of data points that can contribute to that.
One of the really unique things that we've studied over the last year was the Bitcoin strategic reserve that was implemented by the US government and some of the things that have happened after government seizures of Bitcoin have occurred over the last year.
So three specific examples was when Bitcoin hit 126,000 last October.
Over the next 30 days, it drew down 20 to 30%.
And that was right when the government seized around $15 billion of Bitcoin from a Cambodian hacking group.
Then the next one is the government invaded Venezuela and they took around $60 billion allegedly in Bitcoin.
In the next 20 to 30 days it dropped 25% approximately.
And then the next time the government when we went into Iran, we seized around a billion dollars in crypto and then it went down another 20 to 30% at that.
So what we're thinking is very interesting is in the Bitcoin strategic reserve is that there's no technical wording that says if a government agency seizes Bitcoin they're not allowed to sell it for cash.
So it's possible.
That these government agencies may be looking to keep those dollars in their budget, and that's contributing to the drawdown we've seen over the last year.
Yes, you highlighted a lot of key data points and of course it's so important to look below the surface, not just that price action when it comes to the crypto majors or even other tokens out there, but it's also about being able to interpret that data and what all of that means.
So we all monitor flows for funds, ETFs, when it comes to weekly performance.
As well, so how do you actually tell the difference between forced ETF selling as well as what's happening out there?
I think if you follow the ETF data like in June we saw one of the largest outflows in quite some time of 4.5 billion.
We've seen some inflows recently.
And when you really study that data and then you compare it against some of these other more unknown data points such as the potential government selling, if that's actually what's occurring, it's one of our thesis, then you add those things together, then you start seeing, OK, this may make Little more sense.
I think there's a lot of data points saying the digital asset market that why are the prices where they are.
It doesn't really make a ton of sense because the traction and evolution of the crypto space is growing significantly and now we're having some of the biggest banks in the world on board into the crypto universe.
And so with the adoption of the foundation growing in this space, you think the price would follow, but we're seeing the inverse of that temporarily.
And so we think there's the government opportunity, there's the ETF mechanics, and also like you noted before, AI.
AI has taken a lot of sales out of the window.
Crypto over the last year because they're chasing that performance.
Yes, and speaking of which, I do want to expand on artificial intelligence, especially because we're paying attention to what's happening with the AI trade as well as an investment theme.
So when it comes to artificial intelligence and what we're seeing in terms of private markets capital, especially ahead of some of the mega IPOs that are expected to come down the pike, what would you say to investors out there right now?
So the interesting thing, I think right now and why I think it's So attractive to enter the digital asset space today is that the big private market activity that has even gone public in the last year.
We have SpaceX's IPO that generated $75 billion and between OpenAI and Anthropic, they did around $14 billion in secondary sales with their employees, some of which generated $30 million or more, a large group of these employees.
So what that tells us is you have internet native individuals working at these forward thinking technology and AI businesses that now have fresh cash and fresh.
From exercising the secondary sales in the private markets, we believe a percentage of that will rotate back into digital assets because these individuals that earn this new liquidity, they fit the target age demographic where some of their largest holdings in their portfolio is crypto.
So it's only logical for us that they'll rotate this cash back into the digital asset space.
And Brian, finally, before I let you go, we're looking at the final months of 2026.
There's a lot in terms of policy that we're expecting.
Especially in a midterm election year, but when we're looking at just Bitcoin, we know that it took Bitcoin 28 months to recover from that bottom back in 2022.
So what were the key takeaways?
What were the lessons there, and what are you focused on as we head into your end?
Yes, so what happened in the past, I think, was much more infrastructure building, security, trust back in the system of digital assets.
The next step, I think, is going to be the regulatory policy.
So we saw that the Senate put up a Vote for the Clarity Act that's going to be happening in September.
So if that passes, that's the regulatory infrastructure for the market structure of the area of the asset class that will come into place for these big institutions to be able to invest trillions and trillions of dollars over the next 5 years into the crypto space.
If that for some reason doesn't pass, what we do know is that the SEC and the CFTC will proactively implement rules to get that regulatory clarity so we can get the institutional adoption infrastructure in place that's necessary for the asset to grow in the future.
And we have about 60 seconds left here.
So I do want to get your take on any ranges or price targets for Bitcoin, not just heading into your end, but also beyond.
So price targets are tough because you just never know what's going to happen.
What I will say today is some of the models that we look to evaluate Bitcoin show that Bitcoin is significantly undervalued today.
So on trend line analysis or stock to flow model, Bitcoin is undervalued by 150 to. $200,000 per coin today and like the adoption power law models or things like Metcalfe's model where you square the number of users in a network and multiply it by the transactional value flowing through the network, those are more in line with Bitcoin's prices but also show slightly undervalued.
So I would say as of today you're getting a pretty large discount and one way to look at that is through Bitcoin treasury companies like Pro Cap Financial as an example.
You're buying 64.
100 $0 of Bitcoin for around $35,000 because those shares are trading at around a 50% discount and they own 5400 Bitcoin on the balance sheet, but the market cap as of yesterday was around $160 million.
So that's $350 million of Bitcoin on the balance sheet with a market cap of $170 million.
That's a 50% discount on Bitcoin.
Well Brian, we will have to leave it there for today, but I appreciate your time.
Thank you so much for joining us and thank you so much for sharing your perspective.
Thank you, Remy.
I appreciate you having me.
