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"Shark Tank" investor Kevin O’Leary is shifting his cryptocurrency approach from tokens to energy infrastructure, stating that power generation is now the true prize.
What to know:
The big pivot: O’Leary has redirected funds from smaller tokens to concentrate on tangible infrastructure such as land, energy, and copper.
- He asserts that power has become "more valuable than bitcoin" and has secured significant land agreements involving stranded natural gas in Alberta and the United States.
- His perspective is informed by the substantial energy demands of bitcoin mining and AI, emphasizing that those who control power can cater to either market.
- He recommends that investors consider copper and gold, highlighting that copper prices have nearly quadrupled for his initiatives over the past 18 months.
- He considers Robinhood and Coinbase as "no-brainer" infrastructure investments, having shifted capital from altcoins into these platforms. He describes Robinhood as the leading bridge for managing equity and crypto within a single portfolio, while calling Coinbase the "de facto standard" for companies to handle stablecoin transactions and vendor payments once regulatory legislation is enacted.
The contrast: The investor provided a stark reality check for altcoins, which he derogatorily labels as "PooPoo coins."
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- O’Leary divested from 27 positions in October, contending that sovereign wealth funds and indexers focus solely on Bitcoin and Ethereum.
- He argues that these two assets account for over 97% of the market’s alpha, rendering other tokens "worthless" to major investors.
- Despite the buzz surrounding Solana, he regards it as "just software" facing a "Sisyphean task" to keep pace with Ethereum’s marketing and adoption.
What comes next: No notable capital growth is anticipated for crypto until the "Clarity Act" is passed, which O’Leary forecasts will occur by mid-May.
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- He attributes the legislative delay in part to Coinbase’s resistance regarding yield on stablecoins.
- O’Leary argues it is "unfair" that banks can earn yield on deposits while stablecoin holders do not, a discrepancy he deems "un-American."
- He anticipates the bill will pass prior to the midterms as staffers are dedicating most of their time to it.
Broader view: Major sovereign wealth funds are poised to invest billions into crypto, but only once compliance barriers are resolved.
- Funds managing $500 billion are seeking to allocate up to 5% to the asset class but are currently hindered by compliance departments.
- These investors are "agnostic" and unemotional, focusing solely on liquidity and alpha rather than the "backstory" of individual blockchains.
